PriceSmart Inc’s Trinidad subsidiary increased its borrowings by a further US$20.84 million during the third quarter ended May 31, taking another step to secure US dollar liquidity for its local operations as foreign exchange (FX) constraints remain a feature of doing business in T&T
The company disclosed last week that the additional borrowing was undertaken to provide greater US dollar liquidity. It follows the US$70.43 million borrowed in mid-2024 to finance the construction of its distribution centre and settle intercompany payables. The new distribution facility at Phoenix Park Industrial Estate, Savonetta, opened in February 2026 at a cost of US$15 million.
During Thursday’s earnings conference call, PriceSmart chief financial officer Gualberto Hernandez said, “As I said before, I think the most important thing is that maybe all other things that we are evaluating internally to either reduce our need for US dollars in Trinidad or get more creative ways, always, of course, complying with all the regulations to get access to those dollars.”
PriceSmart Trinidad had already borrowed US$23 million between 2021 and May 2025 to support its operating requirements. The latest financing underscores the extent to which access to US dollars continues to influence the company’s operations in Trinidad.
PriceSmart has been flagging the foreign exchange issue since 2017 as a factor affecting its business. It reduced US dollar imports into Trinidad in November 2020 after the shortage of foreign exchange in the domestic financial system limited its access to hard currency.
At the same time, the Trinidad business continues to accumulate large cash balances because the TTD is not readily convertible into other foreign currencies. Cash and short-term investments denominated in TTD reached the equivalent of US$100.5 million in November 2020, the highest level recorded by the company.
Although that balance has declined, it has remained elevated. The equivalent TTD balance stood at US$75.6 million in February 2025 before falling to US$59.7 million in August 2025. It subsequently increased to US$80.2 million in November 2025 before declining to US$44.1 million as at May 31.
Discussing the company’s foreign exchange strategy, Hernandez said, “We only buy what we believe we can get a relatively good transaction cost to access these US dollars. There are no changes in the policy or the strategy. We continue permanently looking for options to get access to dollars in different ways.”
He also pointed to the company’s relationships with financial institutions as it continues to explore alternative avenues for obtaining US dollars.
PriceSmart’s cost of operating Trinidad is higher due to additional interest expense on its rising US dollar debt, while it is also paying to convert local currencies into US dollars through intermediary currencies.
The company reported currency conversion costs of US$8.5 million during the third quarter and US$15.1 million during the first nine months of its financial year in markets experiencing foreign exchange shortages. Those transactions involve converting local currencies into available trading currencies, including euros and Canadian dollars, before converting them into US dollars. The additional conversion costs reduce profitability and ultimately increase operating costs in affected markets such as T&T.
PriceSmart joins a growing list of companies highlighting the financial impact of Trinidad’s foreign exchange constraints. Prestige Holdings Ltd recently reported that foreign exchange swaps and sourcing alternative currencies weighed on profitability because those costs exceeded the pricing of imported inputs.
AS Bryden & Sons Holdings also relied on more than US$8 million in advances from its subsidiary, Caribbean Producers (Jamaica) Ltd during 2025 to support its foreign exchange needs.
