Soyi­ni Grey and

An­drea Perez-Sobers

RBC in­sists that the re­cent for­eign ex­change lim­its an­nounced for its cred­it cards are nec­es­sary in the face of a steady in­crease in for­eign cur­ren­cy trans­ac­tions with no cor­re­spond­ing in­crease in sup­ply.

The Cana­di­an-based bank said, like any fi­nan­cial in­sti­tu­tion, it reg­u­lar­ly re­views the forex lim­its on clients’ cred­it cards and re­alised it would have to im­ple­ment lim­its ef­fec­tive De­cem­ber 1.

In re­sponse to ques­tions from Guardian Me­dia, RBC said, “We un­der­stand this sit­u­a­tion may cause in­con­ve­nience, and we deeply em­pathise with our clients who re­ly on for­eign cur­ren­cy for their per­son­al and busi­ness needs. We al­so recog­nise the hol­i­day months are a time when many peo­ple have the great­est need for for­eign ex­change, but these ad­just­ments are nec­es­sary.”

On Fri­day, RBC an­nounced that cred­it card hold­ers will see their month­ly lim­it re­duced from $41,000 to $14,000 in forex equiv­a­lent. This rep­re­sents a 66 per cent de­crease.

Weigh­ing on the is­sue, Greater Tu­na­puna Cham­ber of In­dus­try and Com­merce Pres­i­dent Ra­mon Gre­go­rio said small and medi­um-sized busi­ness­es will feel the brunt of the cred­it card cuts.  

“We have small and medi­um-sized busi­ness­es in our Cham­ber who im­port prod­ucts, im­port their goods and raw ma­te­ri­als for their busi­ness process­es and this will fur­ther hin­der their abil­i­ty to be com­pet­i­tive and they will now have to seek al­ter­na­tive sources or al­ter­na­tive mar­kets to be able to sat­is­fy the de­mand in the lo­cal mar­ket,” he ex­plained.

To­ba­go Busi­ness Cham­ber chair­man Mar­tin George re­it­er­at­ed his call for an im­me­di­ate and un­con­di­tion­al re­peal of the For­eign In­vest­ment Act as a di­rect mea­sure to ease the forex cri­sis.

George said the Cham­ber had been cham­pi­oning this ap­peal for many years as the “re­pres­sive and ob­struc­tive leg­is­la­tion” rep­re­sents a “pal­pa­ble ab­sur­di­ty,” es­pe­cial­ly in the face of the se­vere scarci­ty of for­eign ex­change.

“It has crip­pled all di­rect for­eign in­vest­ment in To­ba­go. While you have oth­er small Is­lands up the Caribbean rolling out the red car­pet, wel­com­ing in­vestors and pro­mot­ing an in­vestor-friend­ly cli­mate, we in T&T in­stead are chas­ing away in­vestors, putting ob­sta­cles in their way, mak­ing life as dif­fi­cult as we could for them, to en­sure they can­not come and in­vest,” he said.

“The sim­ple fact is that the act needs to go. It needs to be re­pealed and ex­punged from our laws im­me­di­ate­ly and en­tire­ly.”

George said this would al­low an in­flow of much bad­ly need­ed for­eign ex­change in­to To­ba­go, with ob­vi­ous spillover ben­e­fits for the en­tire coun­try.

Fyz­abad Cham­ber of Com­merce Pres­i­dent Ang­ie Jairam said one of the rea­sons for the forex crunch was the clo­sure of the Petrotrin re­fin­ery, which had been a big earn­er of for­eign ex­change.  

“The ques­tion is why did the gov­ern­ment close down the re­fin­ery and now five years lat­er the gov­ern­ment can­not find a buy­er? 

“There has been lit­tle or no in­crease in the bud­get for agri­cul­ture and tourism, which are low-ly­ing fruits to as­sist with the short­age. The SMEs will con­tin­ue to be in dire straits with their busi­ness­es with this short­age of forex,” Jairam said.  

RBC is the lat­est bank to re­duce for­eign ex­change lim­its on cred­it cards. Sco­tia­bank re­cent­ly an­nounced that ef­fec­tive De­cem­ber 1, hold­ers of the Aero Mas­ter­card Black will on­ly be able to spend a max­i­mum of US$5,000 a month. Per­son­al cards have a US$2,000 lim­it.

Re­pub­lic Bank made sim­i­lar changes to its forex lim­its in Sep­tem­ber 2023. Their cus­tomers can ac­cess a max­i­mum of US$5,000 per state­ment cy­cle.

On Tues­day, Min­is­ter of Fi­nance Colm Im­bert held a press con­fer­ence where he said it was time to re­view the cur­rent ho­n­our sys­tem by which forex is dis­trib­uted.