GUEST COMMENTARY: BY GODFREY ENEAS
NASSAU, Bahamas, April 13, 2022 –Bahamians are confronting this issue of inflation which, in my opinion, is not clearly comprehended by a high percentage of our people. In our country, challenges such as these are seemingly placed at the feet of the government with little attempt to understand the basis for this scenario.
Small countries like ours will always face these External Shocks and our people have to learn to cope because these shocks are beyond the control of the government.
In the United States, the overall cost of gas, food and other every-day items is increasing at its fastest rate in more than 40 years. And experts cannot say with confidence whether price increases will speed up or slow down in the coming months.
The accelerating price rate — in other words, inflation — hit 8.5 percent in March over the previous year, according to a US federal report released yesterday. That was the fastest increase since 1981.
In the United States, rising gas prices drove more than half of the March increase, largely because of the war in Ukraine and subsequent sanctions on Russia, a major oil and gas producer. But costs for other goods, including housing, increased significantly in March, too. Meats(beef and pork),poultry, fish and eggs in the United States increased in March by 13.7 %.In the context of The Bahamas — when freight, handling and mark-up are added for the Bahamian consumer — this could climb to as much as 50%.This is the impact of “Imported US Inflation.”
Unexpected events have disrupted supply lines for the past few years and could again. Russia’s invasion of Ukraine has already caused gas prices to spike. Because Ukraine is a major food producer, the war has also increased food prices and may continue to do so.
Some experts in the US are optimistic. They believe that inflation could start coming down later this year. Gas prices in America are also already down a bit from a peak in March. Some of that is driven by China’s lockdowns, keeping many potential consumers home. Over time, the world may also adjust to the Ukraine war’s shock to oil and gas markets. Europe, for example, could find alternatives to Russian oil and gas, like more U.S. drilling or clean energy sources, to fill current gaps in supply.
UK inflation reached a 30-year high of 7% in the year to March, the Office for National Statistics revealed. Fuel prices were one of the key drivers of inflation, with average petrol prices rising 12.6% per litre between February and March – the largest monthly increase since records began in 1990.
(EDITOR’S NOTE: Godfrey Eneas is a former president of the Bahamas Agriculture and Marine Sciences Institute (BAMSI) in North Andros.)
