PM brings fresh focus on forex, but must do more

PRIME Minister Stuart Young does not have much time to make a dent in the foreign exchange situation.

His meeting with the Central Bank, the Bankers’ Association and the heads of various commercial banks on March 25 is, it seems, to be followed by another meeting in April. That meeting will be days before the general election.

So, it is understandable why Mr Young has narrowed the scope of what he seeks to focus on, at least initially.

According to him, his interest is in tackling the difficulty the "small man" has in accessing forex for simple things like travelling or sending to family abroad.

This might seem like a more politically expedient, populist aspect to tackle on the eve of the April 28 poll.

The entire exercise of meeting with stakeholders who have already aired their perspectives over the years suggests pageantry, not policy formulation.

But it is a mistake to dismiss outright the significance of Mr Young’s focus on the plight of the average citizen in getting a few greenbacks.

In fact, the Prime Minister’s fresh approach is laudable for how it re-centres this issue around ordinary people and not just businesses, whether large, medium or small.

Whatever new policy position Mr Young and his finance minister Vishnu Dhanpaul come up with, if any at all, it will undoubtedly only be a plaster placed over a deeper, structural problem.

Limits imposed by banks on customers who walk into their branches to access currency – as well as recent reductions in credit – are merely symptoms of a bigger problem, not the problem itself.

At its core, the foreign exchange issue reflects the imbalance in the economy between local production – whether energy-related or otherwise – and the glut of imports.

It will take more than a few meetings for that to change.

And yet, Mr Young has placed a compelling spotlight on a dimension of the issue that is often crowded out by the clamour from a dissatisfied corporate sector.

Too often, it is the average person who has to bear the brunt of situations in which other, vested interests are the major players.

The few measures of prominence unveiled by Mr Dhanpaul’s predecessor included things like a window oriented towards exporters, not members of the public.

A central bank governor was even summarily, and unlawfully, dismissed for controversially highlighting details of the forex matter, when there was growing concern about it among the general public.

Already the new PM’s approach is a refreshing shift.

With the Opposition accusing him of being an out-of-touch "one percenter," and promising to set up a forex commission, Mr Young is leveraging goodwill and showing how his connections are, in fact, useful to the notion of public service. His focus, as well, on bank charges and fees, is clearly amenable to the campaign trail.

But he must resist leaving it at just token gestures and high-level meetings. Even with time being against him, he must deliver some proof of the relief he promises.