Bitter blow

 
Last Updated: Saturday 04 July 2015

Unfruitful harvest (Credit: Devid Tihon)The worldwide slump in prices of primary commodities has claimed another victim -- the spice industry of the tiny Caribbean island of Grenada. A sharp decline in prices of nutmeg, of which Grenada is the world's second-largest producer after Indonesia, has triggered an economic crisis for the 'Spice Island'.

Any fluctuation in nutmeg prices massively affects Grenada's economy; more than a third of the population earns its livelihood by cultivating the spice. A nutmeg glut has resulted in prices falling from us $1.50 a pound (453 grammes) to just us $1 a pound this year. The finance ministry has had to cut the growth forecast from 2.5 per cent to 1.5 per cent. "The price reduction means that there will be less disposable income in the hands of farmers, resulting in diminished spending power and a fall in business activity," lamented finance minister Anthony Boatswain. Having earned us $20 million (m) from the nutmeg industry last year, Grenada had hoped to see the industry contribute us $5m more this year.

Subscribe to Weekly Newsletter :

Comments are moderated and will be published only after the site moderator’s approval. Please use a genuine email ID and provide your name. Selected comments may also be used in the ‘Letters’ section of the Down To Earth print edition.