Former ministers sceptical on mid-year review

FORMER government ministers Conrad Enill, Mariano Browne and Vasant Bharath yesterday expressed different views on what the public could expect when Finance Minister Colm Imbert presents the mid-year review in the House of Representatives on Thursday.

However, they all agreed that issues such as debt, economic diversification and foreign exchange must be urgently addressed in order to strengthen the economy.

Economist Dr Ronald Ramkissoon agreed, saying it may be time “to take the bitter medicine” in order to get better.

At the launch of the Export Import Bank’s (Eximbank) foreign exchange (forex) facility last Thursday, Imbert said the population could expect good news in the mid-year review.

Enill told Newsday the “good news” Imbert referred to could be a result of oil prices rising to US$70 per barrel yesterday. Based on efforts by Government to strengthen the energy sector, Enill said, Imbert’s optimism could also be based on the expectation of increased gas production.

This means more revenue to reduce the budget deficit from $21 to $15 billion and pay wages on time, he explained.

However, Enill said while these are positive developments, “We are not out of the woods yet.”

Browne believed the review will be “pure public relations.” He said Government has no control over global oil prices rising. Any domestic incentives to boost the energy sector were left behind by the former People’s Partnership government, Browne added.

He anticipated that Imbert will avoid announcing any measures such as gas-price hikes or new taxes “like the plague.”

Browne said TT’s Gross Domestic Product today is five to eight per cent of what it was in 2008, and revenues from the non-energy sector have been declining. He also believed Imbert is not treating with issues raised by Standard and Poors (S&P) and the International Monetary Fund (IMF) about measures to improve the economy.

Bharath described Energy Minister Franklin Khan accepting blame for S&P receiving the wrong energy forecast as “a ruse.” Imbert should have ensured that the proper data was sent through his ministry and approved by him, Bharath said. Saying a finance minister must give people confidence to invest in a country, Bharath claimed Imbert’s public pronouncements have had the opposite effect, alleging that Imbert’s statements have created fear and uncertainty in the minds of potential investors.

Any “good news” announced by Imbert will be temporary, and with energy plants in TT operating at between 75 to 80 per cent capacity, Bharath said any new gas will go to fill those shortfalls.

He opined that Government’s strategy to boost revenue through taxation and selling off certain assets has been unsuccessful.

Bharath said he had no problem with Government borrowing money, but it must be put to productive use. There is no evidence, he said, of any significant capital expenditure projects by Government in recent times.

Ramkissoon said whenever there are improvements in the energy sector, everyone from “captain to cook” postpones the long-overdue conversation about economic transformation, and the country continues “to live beyond its means” and in a sense of false comfort.

Saying all governments are to blame for this situation, Ramkissoon regretted that Imbert’s presentation on Thursday will be “the same old same old.”