Minister must now read the riot act

THE EDITOR: The historical background in respect of two foreign-owned conglomerates – Caroni Ltd and Petrotrin (sugar and oil, respectively) – are well documented and there is no need for me to repeat these here extensively. However, for the completeness I direct attention to the following:

(1) Prior to their nationalisation, both enterprises were previously foreign-owned and managed and, between them, they represented, considerably, the “commanding heights” of the economy of TT.

(2) In light of the political philosophy which had become prevalent with the onset of independence and nationhood, it was resolved that action should be taken enabling the transferring of ownership and management of these “commanding heights” to local hands.

(3) The process underlying nationalisation of the two giants was to turn out to be different, in that while the market for sugar was very much on the “downswing,” the same could not be said of the oil and fuel industry internationally.

Indeed, it was clear that Tate & Lyle – owners of the sugar plantations and factories – must have been in their glee to be relieved of what had become a “burden.”

On the other hand the oil industry had displayed evidence of buoyancy and relative stability for as long as could be then envisaged. Not so today.

(4) Petrotrin – a company with disparate operations which had been fitted together from several sources (predominantly British and American), the managing of which ought to be no different from privately-owned enterprises operating in a highly competitive environment – has found itself prominent among the almost 100 state enterprises and statutory authorities by being highly dependent, in some fashion, on government financing.

(5) The lesson from Petrotrin therefore brings out forcefully the objectives which ought to dictate the manner in which a commercially-oriented enterprise (whether privately-owned or state-owned) should not be managed.

(6) It seems clear that, given the disparate operations of the company, there did not exist a system which had demanded that cost/revenue outturn of every constituent entity be kept assiduously in vogue, the most prominent example of which is being now displayed by the “refinery debacle.”

(7) There is clearly a need to bring forcefully to the fore the distinction which exists between state-owned entities which have a social responsibility of sorts and those which are to be commercially operated.

(8) Much has been written in respect of item (7) and it now behooves the Minister of Finance to read the proverbial “riot act” in his presentation of the 2019 budget.



"Minister must now read the riot act"

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