Friday, September 26, 2008

6% inflation rate not a short term reality

Published: Friday Septmeber 26, 2008

A six per cent inflation rate is not something that can be achieved over the next two years, Finance Minster Karen Nunez-Tesheira has said.

"The Government is committed to dealing with inflation but we certainly did not anticipate that we would bring it back to six per cent in the immediate future.

"So the six per cent is not for next year. I would like it to be for next year, but I don't think that is achievable in the shorter term," Nunez-Tesheira said at the Crowne Plaza Hotel in Port of Spain yesterday. She was speaking at the American Chamber of Commerce of Trinidad and Tobago's post-Budget panel discussion.

The Minister explained that the 2008/2009 Budget statement set out measures that are going to implemented to bring the inflation rate down to six per cent in the long term.

"As a matter of fact, I've had meetings with the Chamber of Commerce and, if my memory serves me correctly, we were looking at by 2010 to perhaps bring it down to about 8 per cent and what we needed to do to bring it down in the shorter term."

The measures outlined in the budget, she said, included dampening demand by encouraging persons to be less consumer oriented, because a lot of the inflation was driven by liquidity, "and at the same time continuing with the investment strategy and creating efficiencies in how we spend what we spend".

"When you are dealing with an emerging developing country and you are dealing with the accelerated growth rate, there are down sides to that," she noted.

Nunez-Tesheira pointed out that even the United States has a higher rate of inflation than its growth rate.

Source: Trinidad Express Newspapers

No comments: