The Ministry of Trade and Industry’s announcement of a review of trade patterns in the wake of Russia’s invasion of Ukraine underlines the need for an even wider examination of trade practices not limited to those two nations.
The ministry’s review will focus on the balance of trade with Russia and Ukraine, but, as the ministry itself has acknowledged, it is clear the ripple effects of Russia’s aggressive assault on the global political order will be far and wide.
According to the ministry, imports from Russia at one stage totalled as much as $1.4 billion. However, such imports have declined significantly over the last 12 years and are now estimated at $24 million. At the same time, Trinidad and Tobago’s total average annual exports to Russia from 2016 to 2021 were approximately $6.3 million.
Both Russia and Ukraine are suppliers of grains, prices of which are already in the throes of an upward spiral due to the covid19 pandemic’s impact on distribution. Even if new trading partners are sourced, there is going to be a heavier price to pay.
Before Russia’s assault, the Central Bank had already projected a rise in inflation. Its updated forecast is expected to include the effects of the ongoing turmoil. CEO of Caribbean Advocacy Gabriel Faria expects inflation to be the highest it has been in years.
Mr Faria also called for traders to look closer to home for the items that might normally be supplied by the two countries.
A call has also been made for Caricom leaders to co-operate to mitigate against the fallout from the conflict by jointly prioritising food security needs.
But the issue of inflation extends beyond just food prices.
Oil and natural gas prices have already gone up in light of the conflict, a matter that will benefit countries like TT but severely hamper our regional trading partners, whose markets we will depend on. Higher fuel prices will also potentially hamper tourism.
Meanwhile, Russia has supplied Europe with approximately 40 per cent of its natural gas needs. But key projects have been quashed amid sanctions, such as the Nord Stream 2 pipeline with Germany.
Less straightforward is the question of Russian capital elsewhere. Britain is known to have deep ties with Russian wealth and there is some debate over how that country is going to wean itself off such murky entanglements.
How these matters play out will have global market implications, particularly in the context of sanctions and Russia’s turn to China to prop up its economy.
Thus the question of how TT trade will be forced to change is not merely limited to the need to bolster our own sustainable practices and local production.
Also required are diplomatic savvy and deepening of ties with countries such as Guyana, which has in the past made available land space in various projects.
The Prime Minister’s recent trip to Qatar, however, has underlined just how quickly the world is changing.
Many of the assumptions of that trip now seem shaky in light of the need for us to deepen collaboration with stable regions, not court areas of the world prone to conflict.