Barbados is firmly in the clutches of an “extremely serious crisis” of the global supply chain, that will undoubtedly result in tremendous price increases.
This is the conclusion of the Minister of Energy, Small Business, and Entrepreneurship, Kerrie Symmonds, after a careful review of the current business climate as well as following close consultations with the Barbados Chamber of Commerce and Industry (BCCI).
So serious is the current situation that a BCCI working group with representation from Symmonds’ ministry is expected to present an urgent list of recommendations to Prime Minister Mia Mottley outlining what they believe is the most appropriate response.
The minister explained that contrary to some popular suggestions, Government is “glued” to the factors responsible for the controversial hike in petroleum prices, which, according to him, are symptomatic of a much larger problem.
“The recommendations that we would have put together in very short order will be directed to the attention of the Prime Minister during the course of this week so that we can put her in a position to speak with the social partnership on this matter because it is a matter of extreme significant national importance,” Symmonds told Barbados TODAY after a meeting on Monday with the BCCI.
“The fact of the matter is that the evidence before us does not point generally in the direction of people acting in a malicious way in Barbados. The evidence largely points to the fact that this country, as with almost every other country on planet earth, is facing an extremely serious situation in so far as surges in prices are concerned.
“Once you are talking about a product that is imported, then you are talking about price surges and that applies across the board from the mighty United States of America right down to little Barbados. If you watch CNN news or BBC news, you are seeing the same concerns being articulated,” the commerce minister contended.
From as early as February, the BCCI warned of imminent price increases due to commodity shortages on the global market. In May, business leaders warned that the hikes could begin from as early as June, with certain items increasing by more than 25 per cent.
Citing research from his ministry, Symmonds explained that with 80 per cent of all goods worldwide transported by sea, increasing freight costs would have a further domino effect on commerce. He explained that factors like the 540 per cent increase in the price of 40-foot cargo containers from China to Europe, due to a shortage of containers, would have a spin-off effect in places like Barbados.
“I’m talking about things like furniture, I’m talking about car parts, I’m talking about food products, I’m talking about clothing. I’m talking about a whole range of things that are being impacted by this dislocation so that petroleum products are but one of those issues which are confronting this country,” Symmonds noted.
“The fact of the matter is that as with the more ordinary commodities, the ability to get ships to move around the world doing the types of deliveries et cetera all forms part of this supply chain and the demand is outstripping supply in every instance.
“The inability to offload ships in a timely manner is another problem we have logistically because whatever it is that you are shipping in whatever part of the world, you still have the problem of COVID-19. You still have the problem of ships arriving in ports that are closed and where their workers are not at 100 per cent available to service the port because they are sick or… you have had to wait a long period of time, so you run up charges. Or alternatively, the ground transportation cannot be done because the drivers of the vehicles are not at work or are ill.
“So there is a knock-on effect on prices at every step of the way, in virtually every product category that you could identify,” Symmonds added.
When contacted on Monday morning, newly-appointed BCCI president Anthony Branker said he could not address the matter as he was in a meeting. Subsequent efforts to reach him were unsuccessful.