Akash Sama­roo

With the busy Christ­mas sea­son com­menc­ing, busi­ness own­ers say they are now los­ing sleep over the wors­en­ing is­sue of for­eign ex­change ac­cess.

But Fi­nance Min­is­ter Colm Im­bert has hint­ed at pos­si­ble State in­ter­ven­tion.
Fol­low­ing calls for Im­bert to step in to reg­u­late how banks dis­trib­ute for­eign ex­change, the min­is­ter took to X, his pre­ferred plat­form for mak­ing an­nounce­ments, yes­ter­day to say, “The re­quest by the me­dia and some busi­ness­men that the Min­is­ter of Fi­nance reg­u­late ac­cess to forex dis­trib­uted by the pri­vate bank­ing sec­tor is in­ter­est­ing. This could be con­strued by oth­er stake­hold­ers as po­lit­i­cal in­ter­fer­ence, so I will look at this very care­ful­ly.”

But ac­cord­ing to some small and medi­um-sized busi­ness own­ers, time is of the essence.

Forex woes were com­pound­ed this week when Sco­tia­bank an­nounced a de­crease in their US dol­lar spend­ing lim­it for cred­it card hold­ers.

The Aero Mas­ter­card Black will be cut to US$5,000 a month, while all oth­er per­son­al cards will see a re­duc­tion to US$2,000 per month.

Sco­tia­bank has al­so in­formed cus­tomers of plans to in­crease cred­it card fees and in­ter­est rates.

Fol­low­ing pub­lic out­rage, Guardian Me­dia reached out to the bank through its com­mu­ni­ca­tions unit but re­ceived no re­sponse.

Yes­ter­day, George Tan­nous, the own­er of pop­u­lar toy store Is­land Hob­bies, said even though he was able to se­cure new items for the Christ­mas sea­son, their for­eign im­ports stand at 10 per cent of their nor­mal ca­pac­i­ty.

Tan­nous said he tried to be proac­tive this year in an­tic­i­pa­tion of this very is­sue but that still could not save him.

“It’s six months now I am putting things in place to get mon­ey for Christ­mas and up to now I can­not get, it’s just crazy. And the cred­it cards gone from US$5,000 to US$2,000, so how are we sup­posed to sur­vive?” Tan­nous asked.

He al­so ques­tioned the bank’s re­sponse to the on­go­ing is­sue.

“The banks, un­der­stand­ing that Christ­mas time is the most im­por­tant time for the re­tail sec­tor, ad­vise to try get­ting for­eign ex­change some­where else. So re­al­ly, I’m con­fused on how the re­tail mar­ket is ex­pect­ed to sur­vive un­der these con­di­tions. Just look at what the banks’ US dol­lar lim­its are now!! It’s a se­ri­ous and alarm­ing down­hill di­rec­tion, as Tri­nis like to say, we re­vers­ing back,” he said.

Mean­while, oth­er re­tail­ers are warn­ing that there may be no Christ­mas spe­cials, dis­counts or sales be­cause of this on­go­ing is­sue.

The own­er of an elec­tron­ic store in East Trinidad, who asked not to be named, said, “Peo­ple would now tend to hold on to the goods for a longer pe­ri­od of time in­stead of of­fer­ing sale prices or dis­count­ed prices. Let’s say you’d nor­mal­ly give a dis­count of $500 on a $5,000 item, now we may of­fer $200. So, you’re go­ing to see some in­fla­tion hap­pen­ing, start­ing prob­a­bly with­in the next 30 days or so and come 2025 it will get con­sid­er­ably worse, and I don’t see this get­ting bet­ter.”

The store own­er said he al­ready has to re­think if it makes sense to bring in cell phones for the sea­son.

“So in­stead of bring­ing in a phone where there is a lot of com­pe­ti­tion, where you can on­ly make 5 or 10 per cent as com­pared to bring­ing in some­thing else where the prof­it mar­gins are con­sid­er­ably more,” he ex­plained.

Mean­while, Mode Alive own­er Gary Aboud shared sim­i­lar con­cerns.

“Every­body is go­ing to have to max­imise their prof­itabil­i­ty and hold to earn suf­fi­cient rev­enue from the lim­it­ed amount of for­eign ex­change. It is forc­ing us to ex­port more, it is forc­ing us to max­imise our mar­gins when we can be­cause we can­not re­place what we have. So, it is putting in­fla­tion­ary pres­sure on the im­porter be­cause if you on­ly have US ten dol­lars that you can get from the bank, your lo­cal ex­pen­di­ture is not go­ing to shrink to meet the US ex­change that you are able to get,” Aboud said.

Aboud added that he has had to dip in­to his sav­ings to stay afloat.
He said this is not a prob­lem brought on by the cur­rent ad­min­is­tra­tion, but he does be­lieve there is room for in­ter­ven­tion.

And those in the lo­gis­tics in­dus­try are not spared as well.

Couri­er com­pa­ny Trop­i­cal Ex­press said the forex short­age will cre­ate a cas­cad­ing ef­fect that goes be­yond sim­ple cur­ren­cy trad­ing.

Of­fi­cials from the com­pa­ny said they bring sev­er­al es­sen­tial items that are sourced through in­ter­na­tion­al ven­dors.
Items such as life sav­ing med­ica­tion not avail­able lo­cal­ly, med­ical equip­ment and sup­plies and spe­cialised ma­chin­ery and equip­ment for busi­ness­es.

Trop­i­cal Ex­press said, “Our com­pa­ny, like many oth­ers in the lo­gis­tics sec­tor, re­quires con­sis­tent ac­cess to US dol­lars to main­tain re­la­tion­ships with in­ter­na­tion­al ship­ping part­ners and en­sure the smooth flow of goods in­to Trinidad. The cur­rent for­eign ex­change con­straints are mak­ing it in­creas­ing­ly dif­fi­cult to meet our oblig­a­tions to these es­sen­tial busi­ness part­ners.”

Guardian Me­dia at­tempt­ed again to get a re­sponse to the is­sue of for­eign ex­change dis­burse­ment from the Bankers’ As­so­ci­a­tion of Trinidad and To­ba­go but on­ly re­ceived ac­knowl­edge­ment of the ques­tions sent with a com­mit­ment that fur­ther com­mu­ni­ca­tion would come if BATT de­cides to re­spond.