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Caribbean Food and Drink Report Q3 2008Published by: Business Monitor International Published: Jul. 1, 2008 - 57 Pages Table of ContentsAbstractAs discussed in BMI's newly-published Q308 Caribbean Food & Drink Report the Caribbean region hasbeen very heavily affected by the spiralling costs of agricultural commodities and the issue continues todominate the local political agenda. As a region that imports around US$3bn of food a year the Caribbeanis particularly exposed to global price movements and the rising commodity prices witnessed in the lasttwo years have led to protests and even erupted into violence in some countries. However, with manypolitical leaders recognising that the answer to this issue may lie in reducing import tariffs andencouraging investment in local food production the situation may have some positive implications forfood producers.The most violent and high profile protests have erupted in Haiti, which is particularly vulnerable becauseof the country’s very high levels of poverty. Here demonstrations have left six people dead and manymore injured and led to the dismissing of the Prime Minister after a no confidence vote. Protests in therest of the Caribbean have so far been less explosive but have been taken equally seriously by Caribbeangovernments. In January 2008 ministers and official from the Caribbean Community (Caricom) met todiscuss the issue and agreed to lower the common external tariff which places a set tax on goods enteringthe region. This is likely to have an affect on prices in the short term, and is good news for firms thatexport to the Caribbean, but will not provide viable long term solution to the main issue which is a lowlevel of domestic production. Most Caribbean governments have recognised the need to boost domestic food production yet not manyhave implemented policies that would aid local farmers and food processors. For example rather thansubsidising food, governments should be thinking about subsidising agricultural inputs and providing taxbreaks for firms wishing to invest in the food industry. However, finally these kinds of policies arefinding an audience among Caribbean officials and in a promising development investors are currentlybeing sought for a number of regional megafarms situated in sparsely population countries with largeswathes of uncultivated land, such as Guyana, Suriname and Jamaica. These kinds of policies are the regions best hope of encouraging self sufficiency however somegovernments are still pursuing policies that are likely to exacerbate the problem of dwindling localproduction. In St Lucia and St Kitts and Nevis a number of foods are now subject to price controls and inBarbados retailers’ mark ups have been limited on certain products. Although perhaps making intuitivesense when the electorate is clamouring for the government to act to stem rising prices, these policies areonly likely to discourage investment in the food industry and make little long term sense if governmentswish to encourage local production. Get Full Details About This Report >> |
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