18 murders, economy in tatters but Rowley says KEEP HOPE ALIVE

With  18 murders being committed within the first seven days of this year and the economy continuing to flat line amid low oil prices, Prime Minister Dr Keith Rowley is urging citizens to keep hope alive.

In a televised address to the nation last night, Rowley empathised with the victims of crime and offered initiatives to lift the economy. “As we reflect on the arrival of 2018 and all that it holds for us, let us spare a thought or a prayer for those individuals and families who have been victims of violent crime from one direction or another.

“Their pain is our pain and even as the New Year has opened with reports of the continued murderous scourge on our land I want to appeal to all citizens to keep hope alive in this war against the heartless family members and career violent criminals,” the prime minister said.

He asked citizens to support the police whose efforts last year netted 1,064 firearms and 18,000 bullets, while 12,000 arrests were effected. Admitting TT faced record killings, Rowley said, “We must and we will win this war on crime.”

“New approaches are at work in the SSA (Strategic Services Agency) and a new energy is beginning to infect the ranks of the Police Service and already we are seeing improvements in response and detections. (Despite) many huge negatives which still exist, we are heading in the right direction.” He hoped to accelerate efforts on all fronts to provide safety and security to the population.

TOUGH ECONOMIC TIMES

On the economy, Rowley admitted the past two years were hard in light of a 90 per cent fall in tax revenues from the energy sector and a 70 per cent hike in Public Debt (from 2010 to 2015). But he stood by his Government’s measures. With the oil-price shock not a short-term cyclical phenomenon but a long-term structural industry change, he said fiscal stability has been an urgent prerequisite to economic diversification. Rowley said Government has borrowed to prevent economic collapse, despite voluminous advice from many quarters. “It would have been a much more arid and barren land had we not managed the last two years with a steady hand, making adjustments along the way.” He lamented that low oil-prices and hefty tax write-offs meant some petroleum companies paid no corporation taxes for over two years.

“The chronic, financial difficulties at Petrotrin have further exacerbated this problem, because although Petrotrin produces over 50 per cent of the country’s oil, it is not paying its oil royalties and taxes in any timely manner or at all.” This is unacceptable and will not be allowed to continue in 2018, he declared.

He said Petrotrin owes Government $2.75 billion of which $588 million is SPT, a tax that only becomes due during times of high oil prices, yet it was not paid then. “What this means is that even as oil prices have rebounded somewhat, the structures in place conspire to ensure that the Government obtains precious little consequential increase in revenues.”

The sharp drop in revenues prevented his government immediately paying arrears of back-pay for Public Servants left by People’s Partnership. “However, we managed to negotiate a solution with the relevant unions and have paid billions over a two-year period.” Noting cuts in the 2017 Budget to the fuel subsidy, GATE and capital costs, Rowley said he is fully aware of the impact of these cuts.

“We know that it’s tough on everyone but there are few better or painless options. We just have to take our medicine and work hard towards the cure that we are confident can be had.”

THE WAY FORWARD

He denied the lower-income groups faced most of the burden of adjustment, citing the zero personal income tax paid on salaries of up to $72,000 per year, and the GATE means test. In an aside he queried whether a recent diesel price-hike truly justified a price-hike in maxi-taxi fares, including hikes by drivers operating CNG-run vehicles.

Saying Petrotrin needs fundamental restructuring which cannot be put off any longer, the prime minister spoke of reviews on the company which all highlighted poor governance, falling oil production, rising manpower costs, rising maintenance and capital costs, low refinery margins and poor asset quality. The company stands to make losses of US$1.5B over the next five years.

“It is our intention to fix Petrotrin’s problems once and for all in 2018, so that the company can service its debt and taxes thereby contributing to Government’s revenue and the country’s development in the way that it should as well as providing job security for an adequate quota of high performing employees,” said Rowley.

On Clico/CL Financial, Rowley that out of the $23 billion bailout paid by taxpayers in 2009, Government has been repaid $8 billion with $16 billion outstanding. “It is our intention that the major assets of the Group, as they become available from the Liquidators, will be placed in a newly created National Investment Fund (NIF), units of which will be available for purchase by all,” Rowley said.

The creation of this Fund has already begun with the transfer of Clico’s shares in Angostura to the Corporation Sole, to recover the debt owed by Clico. “And as more assets become available, such as shares in Republic Bank and other listed companies, they will be placed in this National Investment Fund.

NEW FERRY FOUND

Rowley said a Cabinet Sub-Committee, using NIDCO as the contracting party, has found a new ferry to service the seabridge which has been floundering after six aborted tenders by the Port Authority previously.

“During the search a suitable new vessel which had not yet been put into service was found by one broker and this vessel was available for sale. We had all the necessary inspection, examination certification checks and sea trials were done on this vessel and after all satisfactory reports were obtained steps have now been taken to purchase this vessel, on completion of this process, should arrive in the country within weeks from a port in Asia.”

Saying 2017 was a “more than challenging year”, Rowley said this new vessel will create a dramatic improvement on the sea-bridge and bring relief to the long suffering people of Tobago from the early months of 2018.

Saying we are a nation that is not without hope, he urged all to put their shoulder to the wheel to face the further adjustments to come as we clear dangerous rapids towards calmer waters.”