Gov’t warns inflation beyond local control

Premier Dr Natalio Wheatley has cautioned that rising prices in the Virgin Islands are being driven largely by external forces, stressing that inflation is “beyond the government’s control” in key areas due to the territory’s reliance on imports.

Speaking during a recent appearance on Virgin Islands Voice, Dr Wheatley acknowledged that while the economy continues to grow, residents are feeling pressure from the rising cost of living.

“We have inflation. We cannot control inflation because we’re heavily dependent [on] imports,” Dr Wheatley stated.

He explained that global developments – particularly geopolitical tensions – are directly affecting prices in the territory.

“For instance, we have the conflict with Iran, United States and Israel… that’s resulting in the price of petroleum getting a lot higher,” he said, adding that this has “a knock-on effect on the prices of shipping and the prices of all of the stuff that we import here.”

The Premier said these external pressures reduce the purchasing power of residents, noting that “when those things… affect families so that the money that you have can’t do as much as it used to do, persons are going to experience some pain and struggle.”

Premier Wheatley’s comments came as government officials outlined broader economic performance, pointing to continued growth driven by tourism and financial services.

However, he stressed that economic expansion does not mean all challenges have been resolved.

“It doesn’t mean that everything is perfect in the economy,” Dr Wheatley said, noting that issues such as inflation and skills gaps remain.

To mitigate the impact of rising prices, the Premier said the government is pursuing several measures to reduce dependence on costly imports. These include sourcing goods from alternative markets and strengthening local resilience.

“That’s why we need to source our supplies from different markets… that’s why we’re going to places like the Dominican Republic to see if we can get goods here… at a cheaper cost,” he stated.

He also pointed to plans for a “protected basket of goods” and efforts to expand renewable energy as ways to cushion residents from global price shocks.

“That’s why we want to become more energy resilient and energy diverse with solar energy so the fluctuations in oil prices don’t impact us as much,” Dr Wheatley said.

The Premier maintained that while the government can take steps to ease the burden, the territory’s heavy dependence on imports means it will remain exposed to international market forces.