Finance Minister Howai: T&T to slash deposits to Petroleum Fund

Caricom countries should not expect T&T to contribute the same amount of money it has contributed in previous years to the Petroleum Caricom Fund, said Finance Minister Larry Howai. “We did make contributions to the Caricom Petroleum Fund, which was a fund established a few years ago and the proceedings from that fund was used to assist our Caricom neighbours in a number of scenarios, but that depends critically on where the price of oil is and the kind of fiscal surpluses we would be in a position to make.

“Because of where prices would be in the upcoming year, it is probably unlikely that we would be able to maintain the levels of contributions to the fund that we were able to make in the past. The amount that would be available would be different to what it used to be in years gone by. The extent to which we could contribute would be different,” he said.

Howai was speaking yesterday at the end of a two-day conference hosted by the International Monetary Fund (IMF) and the Caribbean Development Bank (CDB) at the Hyatt Regency Trinidad hotel, Port-of-Spain. For the first two years of the Caricom Petroleum Fund, established in 2004, T&T contributed $750 million.

When asked if T&T will continue subsidising the economy on the levels it has done in the past, given T&T’s fuel subsidy which now stands at $3.2 billion, Howai said he has not been Finance Minister long enough to determine something like that.
Howai assumed the portfolio of Finance Minister in June.

“We have to take a closer look at all our expenditure and be sure that we can justify that expenditure and all aspects of it. I would say I have been in office for two months and that is not enough time really to get a full view and full consultation and develop all the details of specific programmes going forward. “We certainly have to continue that process of going forward in the new fiscal year. All the programmes we currently have will have be reviewed in the context of the current situation that exists.”

Howai is optimistic about the economy on the heels of Tuesday’s concluded bid round for five deepwater blocks. Twelve bids were received. “There has been a lot of positives coming out of the deepwater bid round. Knowing the people of T&T like I do, people would start spending money on the basis of the deepwater bid round, which was successful,” Howai said. “We are very optimistic about that and it is expected that what comes out of that, we will continue to focus on making levels of expenditure sustainable.”