Food prices and food security in CARICOM - The case of Trinidad and Tobago

The unprecedented rise in food prices over the last two years sent shock waves throughout the entire world. The rise in food prices was caused by factors including increases in commodity prices, the use of corn for ethanol production, increased incidence or severity of drought and flooding and the greater demand for food and commodities, particularly in China and India. Trinidad and Tobago which is a net food importer, over TT$4 billion in 2008, experienced food inflation of 25.2 per cent in 2008. The agriculture sector has been declining over the years. Its contribution to Gross Domestic Product was 0.4 per cent in 2007. Rising costs, shortage of labour, praedial larceny all had a negative impact on production. The government response to rising food inflation has been fiscal measures through the reduction of duties as well as addressing the supply side. In its 2008-09 budget, there were increased allocations for investment in the sector, provision of credit and reduction of interest rates. A Transformational Plan was developed to address the issue of food security. The objectives outlined in this Plan is for the country to produce as least 25 per cent of its food needs from the six food groups, bringing into production an additional 20,000 acres of land (large farms and Caroni lands) and the production of targeted commodities to meet local and export market demands. There has been some evidence of success in reducing food prices through the strategies of establishing Farmers’ Markets and the implementation of the National Agricultural Market Information System (NAMIS). This paper looks at the causes of soaring food prices in Trinidad and Tobago and the government’s response to mitigate rising prices and measures to address the issue of food security.