Inflation levels in Territory manageable- Premier
This is according to Premier Dr. D. Orlando Smith, who made the statement during his budget address in the House of Assembly on Tuesday January 17, 2012.
Dr. Smith said average prices for goods and services rose modestly in 2011 between two and three percent (2% and 3%) and this has been the trend for the last few years. Rising fuel costs and to a lesser extent housing associated costs and food prices contributed to average increases in 2011.
“As a non-industrialized country, BVI’s inflation is directly related to its imports primarily from the United States and hence the rate of inflation here mirrors that of the US.
Meanwhile, the Premier said, in recognizing the high cost of goods and services here in the Virgin Islands, his administration has already commissioned an analytical exercise in the Ministry of Finance to look at the issue of levying on businesses duty only on the free on board prices on imported goods as opposed to the total of cost, insurance and freight, a measure which Government expects to put in place very soon.
He noted the purpose is to provide local businesses with an opportunity to be more competitive with their external competitors and that by passing the savings on to the customers permits the retention of a higher percentage of individual earnings so that citizens would have more disposable income to meet the needs of their families, and to have that money circulate many more times within the Territory before it takes flight.
“Greater competition in business will result in a lower cost of living for the average BVI resident. We believe, like the late Chief Minister Hamilton Lavity Stoutt did, that with more discretionary dollars in the pocket of the ordinary man, he will build the BVI.”
The National Democratic Party (NDP) during the campaign trail had expressed concern that local business were being put at a disadvantage by the cheaper prices in neighbouring St. Thomas, USVI and hence persons were leaving the island for better bargains.
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