FINANCE Minister Larry Howai has failed to adequately address the issue of food security, says economist Indira Sagewan-Ali.
"In looking at the allocation, I want to say that agriculture, in this budget has gotten a lesser share of the pie than last year's budget, even though in the same breath the Minister talked about the importance of food security and agriculture, so there seemed to be a contradiction except that, if it is he intended to bring more private sector money into it, then not so much so," she said.
Sagewan-Ali was speaking during CCN TV6's post-budget 2012/2013 panel discussion on Monday.
Of the $58.4 billion set aside by Howai to manage the financial affairs of Trinidad and Tobago for the period 2012/2013, agriculture received $1,338.3 million, a total of $616 million less than in the 2011/2012 budget.
Pursuant to that, Howai announced that with agricultural land becoming less and less available in Trinidad and Tobago, the Kamla Persad-Bissessar administration was now looking to Guyana to deal with the situation.
He said that a facility would be developed that "would commit both governments to expanding agricultural production in Guyana through the establishment of commercial relationships for funding the establishment of several large agricultural estates in Guyana".
As a point of fact, in 2005, Caribbean Community (Caricom) leaders had agreed on an initiative developed by former Guyana president Bharrat Jagdeo to advance the regional transformation of agriculture, ensure the region is food-secure and make the sector competitive.
And in an attempt to reduce the cost of food, Howai further announced the removal of Value Added Tax on more than 7,000 food items.
Sagewan-Ali, however, added that the decision to remove VAT raised several issues, among them being the amount of revenue the Government stood to lose.
"If we are talking about an across-the-board removal of VAT, there are several things that concern me. One, how much is the reduction in taxes that Government is prepared to forego and where is it going to be making that back on, that is one level, the other more important level is the potential impact of this measure on the domestic agricultural sector.
"Because, by and large, the goods that will have VAT removed will be imported goods and we have been moaning the fact that we have a $4 billion import bill and while in the short term you may need it, unless we are able to do something simultaneously to be ramping up the agriculture sector and supporting our farmers, we can see a very negative impact on the domestic farmer," she said.
Also addressing Government's decision to remove VAT from more food items, Ronald Ramkissoon, chief economist at Republic Bank, said there were many other factors that influenced the price of food and suggested that the Government address those.
"The increases and so on that we see in the price of imported food, that is not going to stop next week or next month. In other words, that is not going to be an answer for what we face in terms of the increase in food prices down the road and into next year, it is not going to provide that, so let us be clear about that," he said.
Sagewan-Ali further stated that in order to adequately address the issue, the Government needed to attack agriculture with the same force given to the energy sector.
"The answer is really very simple, the aggression with which we need to approach our agriculture we have not yet done so. We have to take the same kind of approach that was taken in developing the energy sector and put that same kind of effort into the agriculture sector."
"We have to take this in a holistic kind of package," she said.