Rapheal John-Lall

Prime Min­is­ter Kam­la Per­sad-Bisses­sar avoid­ed hav­ing a "crit­i­cal con­ver­sa­tion" with the coun­try about the econ­o­my when she ad­dressed the na­tion on Thurs­day night, econ­o­mist Dr Ronald Ramkissoon said.

"Suc­ces­sive ad­min­is­tra­tions, in­clud­ing this one, have avoid­ed speak­ing to the pop­u­la­tion in a way in which they would ap­pre­ci­ate the na­ture of the econ­o­my and ac­cept that we need to di­ver­si­fy the econ­o­my. The Prime Min­is­ter re­al­ly avoid­ed hav­ing that crit­i­cal con­ver­sa­tion with the pop­u­la­tion. Much of the pop­u­la­tion still does not un­der­stand the im­pli­ca­tion of the rise and fall of oil prices. The pop­u­la­tion must know that we must con­sume less and save more," he said.

Re­fer­ring to spe­cif­ic sta­tis­tics the Prime Min­is­ter gave in her ad­dress, Ramkissoon said: "What the fig­ures she pre­sent­ed do is fore­cast a larg­er deficit which is to be fund­ed part­ly by the fall in the price of fu­el and by the amount of mon­ey the Gov­ern­ment al­lo­cates for sub­sidy.

I do not agree with the cut in the Pub­lic Sec­tor In­vest­ment Pro­gramme. This is im­por­tant for gen­er­at­ing growth in the long run, as dis­tinct from pub­lic ex­pen­di­ture on sub­si­dies and trans­fers and wages and salaries which are re­cur­rent ex­pen­di­ture.

"Cap­i­tal ex­pen­di­ture is about in­fra­struc­ture which is im­por­tant in crowd­ing the pri­vate sec­tor to bring them in the pic­ture. It al­so builds the foun­da­tion for growth down the road and di­ver­si­fy the econ­o­my," he said.Ramkissoon de­scribed plans for a pub­lic share of­fer­ing in Phoenix Park Gas Proces­sors Lim­it­ed as a pos­i­tive move and sug­gest­ed that di­vest­ment fund­ing be used for cap­i­tal projects rather than re­cur­rent con­sump­tion.

Hugh Howard, pres­i­dent of the Amer­i­can Cham­ber of Com­merce of T&T (Am­chamTT) agreed with the de­ci­sion to peg the na­tion­al bud­get on an oil price of US$45 dol­lars a bar­rel."Some pun­dits pre­dict that oil will be back up to $60 a bar­rel by Ju­ly. As­sum­ing that the pun­dits are cor­rect, that means that the Gov­ern­ment will on­ly ben­e­fit from this for the bal­ance two or three months for the fis­cal year," he said.He ex­pressed con­cern, how­ev­er, that the ques­tion of sub­si­dies had not been ad­dressed.

"The Gov­ern­ment should not be pro­vid­ing a fu­el sub­sidy for peo­ple who can af­ford a half mil­lion dol­lar car, or Gate for stu­dents with par­ents who earn more than a mil­lion dol­lars a year. The Gov­ern­ment should be pro­vid­ing a sub­sidy for pub­lic trans­porta­tion and Gate for stu­dents whose par­ents earn low­er in­comes," he said.

The Trinidad and To­ba­go Man­u­fac­tur­ers' As­so­ci­a­tion (TTMA) said the Gov­ern­ment made a wise de­ci­sion to re­vis­it the bud­get­ed oil and gas price and to re­duce ex­pen­di­ture on in­fra­struc­ture projects for which fi­nanc­ing have not yet been com­mit­ted.

"The As­so­ci­a­tion be­lieves that the Gov­ern­ment's in­ten­tion to di­vest spe­cif­ic state owned en­ter­pris­es, name­ly shares in Phoenix Park Gas Proces­sors Ltd through the stock ex­change moves our coun­try in the right di­rec­tion. Such an ini­tia­tive will al­low for di­rect par­tic­i­pa­tion in the en­er­gy sec­tor by the cit­i­zens of Trinidad and To­ba­go," the group said in a state­ment.

"We look for­ward to pol­i­cy mea­sures that will spur in­creased growth for man­u­fac­tur­ing in 2015 and be­yond, as we con­tin­ue to play our part in di­ver­si­fy­ing the econ­o­my. With the right di­ver­si­fi­ca­tion frame­work set by the gov­ern­ment, the TTMA is con­fi­dent that its man­u­fac­tur­ing sec­tor will con­tin­ue its up­ward tra­jec­to­ry in a sus­tain­able man­ner."

How­ev­er, an­oth­er busi­ness or­gan­i­sa­tion, the T&T Cham­ber of In­dus­try and Com­merce said the Prime Min­is­ter "avoid­ed key is­sues or dis­clo­sure of the need for pos­si­bly tougher ad­just­ments.""We al­so be­lieve that the Prime Min­is­ter missed the op­por­tu­ni­ty to take the na­tion in­to her con­fi­dence in terms of shar­ing im­por­tant sta­tis­ti­cal pro­jec­tions in or­der to ad­e­quate­ly pre­pare our­selves for the chal­lenges ahead," the Cham­ber said.

"The short-term mea­sures pre­sent­ed lacked eco­nom­ic sub­stance. The T&T Cham­ber calls on the Prime Min­is­ter to be more open and trans­par­ent in shar­ing the key un­der­ly­ing as­sump­tions and their like­ly im­pact on bal­ance of pay­ments as well as in­ter alia, for­eign ex­change avail­abil­i­ty, the ex­change rate, in­ter­est and wages. These are the de­tails that busi­ness­es and house­holds need to make in­formed de­ci­sions for their sus­tain­abil­i­ty.

"The Prime Min­is­ter al­so missed the op­por­tu­ni­ty to im­press up­on the pop­u­la­tion the need for re­straint in these un­cer­tain times."