On the heels of the recent insistent warnings from within the region that the Caribbean’s food security status might not now be as reassuring as we might have imagined the Inter-American Development Bank (IDB) has given notice that countries in the region should brace themselves for what a Caribbean Media Corporation report says will be the “prolonged effects of external economic shocks in 2023, including for high food and fuel prices and rising international interest rates”.
The news is almost certain not to come as a surprise to the region where high food prices and in some territories, the underperformance of the agricultural sector had already cast worrying shadows on the food security status of much of the region, going forward. Food security challenges apart, the IDB is warning in its recent report that threatened high interest rates could have the effect of creating economic slowdowns, or worse outright recessions “in important source markets for exported services and goods from the Caribbean.”
The impact of the likely shocks, the IDB has said in its report titled “Headwinds Facing the Post-Pandemic Recovery,” will depend on “the trade structure of individual countries, as well as the external financing requirements of each country.”
The report’s key findings include the revelation that a number of both households and businesses are feeling the impact of price increases.
Indications that member countries of the Caribbean Community (CARICOM) have been struggling under the weight of increases in imported food prices, particularly, materialized earlier this year when the region announced a high profile move to take steps reduce its food imports by 25% by 2025. Earlier, the setting up of a Regional Food Terminal designed to guard against food security crises in the more vulnerable countries of the region had been launched following a series of high-profile events in parts of the Caribbean including Guyana, Barbados and Trinidad and Tobago.
The IDB report says that while “domestic inflation has been somewhat less severe in Caribbean countries, rising prices had had the effect of diminishing incomes for households and increasing costs for firms.” Months prior to the recent IDB report, earlier reports from some of the smaller islands in the region had provided evidence of pockets of food insecurity in those countries.
