It is no surprise the ineffectual debate about reducing the cost of living has resurfaced. As usual the country is beguiled by the usual talking heads whose commentary is crafted to fulfil political interest and reaffirm traditional economic theories.
However you ‘slice and dice’ the challenge facing Barbados to significantly reduce the cost of living, it cannot change the fact Barbados is a net importer of commodities. For those who will interject that tourism as a service generates significant revenue inflow, it is an industry with significant foreign ownership which dilutes earnings making its way onshore.
A significant slice of Barbados’ import bill is oil and food totalling north of 40% by the blogmaster’s estimation. It does not require complex reasoning to understand that a significant increase in oil price and food will increase cost of living in Barbados. The disruption to global supply chains as a result of the pandemic quickly followed by the ongoing conflict between Russia and Ukraine (responsible for producing a significant share of the world’s agricultural products used as inputs in food products) means Barbados as a net importer will continue to import inflation.
With the cost of living on the jump trade unions in Barbados have signalled labour expects a favourable response to an increase in wages. Pensioners and other vulnerable groups have also been crying out as the economic climate becomes more severe. ‘Heavy is the head that wears the crown’ – with cries emanating from all quarters what will the Mottley government do to deliver comfort to citizens in most need? Without being insensitive to the plight of suffering Barbadians there is so much protection a broke heavily indebted government can offer. The longer external shocks persist ‘crapo smoke [we] pipe’.
The blogmaster – unlike some here – is not qualified to recommend to the leadership of the country the best approaches to take to manage an open economy during crisis after crisis. What can be said however is the importance of our leadership rallying the country around ‘fit for purpose’ national objectives. Truth be told, can many Barbadians say we have made significant adjustments to our lifestyle to effectively respond to the increasing adverse economic environment?
The blogmaster continues to be amazed at the bustling activity at fast food and fine dining restaurants. The number of vehicles zipping up and down the highways as byways 24/7 given the astronomical gas and diesel prices at the pump. The one that peeves the blogmaster no end is an aversion many Barbadians have to suffer discomfort in vehicles by leaving air conditioning units turned off. There are many initiatives individuals can undertake to help themselves and those who can afford it, do it as a means to help others.
The foregoing is not meant to excuse government from leading by example and doing all that it practical to execute fit for purpose policies. These are challenging times and a government with an unprecedented large Cabinet is expected to over achieve regardless of the challenges. To whom much is given much is expected.