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Victors Supermarket shelf
Victors Supermarket shelf

Montserrat to Feel the Pinch as U.S. Tariffs Imposed

Local supermarkets in Montserrat are already feeling the effects of rising import costs, despite U.S. President Donald Trump pausing tariffs against Canada and Mexico. The lingering impact of trade tensions and inflation continues to push prices higher, putting pressure on businesses and consumers alike.

U.S. President Donald Trump initially imposed tariffs on imports from key trade partners, including Canada and Mexico, as part of his “America First” policy, aiming to protect domestic industries. Although these tariffs have since been paused, the broader effects of global trade policies, retaliatory tariffs from other nations, and overall economic uncertainty persist, contributing to increased costs for imported goods.

Manish Valeccha, owner of Victor’s Supermarket, which also supplies other grocers on the island, said that the cost of saltfish, which is imported from Canada will now cost him 25% more.

As Montserrat also imposes customs duties on imports, this means the cost of the saltfish and other staple goods will increase by the time it reaches store shelves.

Additionally, the supermarket owner notes that supply becomes an issue when sourcing alternative products from other Caribbean islands, making it difficult to find cost-effective substitutes. And shipping half-empty containers makes no economic sense.

Montserrat was already grappling with high prices before the tariffs, as the island has not yet recovered from the significant cost increases experienced during the COVID-19 pandemic. Supply chain disruptions, inflation, and increased shipping costs had already strained household budgets. Now, with tariffs further driving up costs, families and businesses will be under greater financial pressure.

A major consequence of U.S. immigration policies, including the deportation of farm workers, is the potential reduction in agricultural labour, leading to higher food production costs. As a net importer of food, Montserrat could experience additional price hikes, further intensifying the economic burden on residents.

To mitigate these economic pressures, Montserrat must explore alternative strategies to ensure affordability and stability in the local economy. One approach is to boost local agricultural and manufacturing production, reducing reliance on expensive imports. Encouraging small-scale farming and food processing could help provide affordable alternatives to imported goods.

The Ministry of Agriculture is already working to address critical challenges in food production and food sovereignty. Minister of Agriculture John Osborne Jr. recently outlined government initiatives aimed at tackling key issues such as land accessibility, an aging farming population, pest control, and irrigation. Plans are underway to lease 50 acres of private land for farming, which will be subdivided and developed with water access before being made available to farmers. Additionally, new incentives, including field fencing, irrigation supplies, fertilizers, and seeds, have been introduced to encourage more sustainable and continuous farming.

Another solution is to strengthen trade relationships with regional suppliers.

The Caribbean Community (CARICOM) has been actively pursuing its “25 by 2025” initiative, aiming to reduce the region’s food import bill by 25% by the year 2025. This strategy focuses on enhancing food security through increased local production, removal of intra-regional trade barriers, and improved logistics and transportation. As of March 2024, CARICOM reported achieving 70% of its reduction target, indicating significant progress toward regional food self-sufficiency. However, challenges persist, including the need for greater cross-border investments in agriculture and the development of sustainable practices to ensure long-term success.

By aligning with CARICOM’s regional efforts, Montserrat can work towards mitigating the impact of external economic pressures and enhancing its own food security.

Additionally, local supermarkets may need to share shipping containers to reduce the financial burden of importing goods.

By focusing on local production and strengthening regional trade partnerships, Montserrat can work toward greater food security for its people.

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