While T&T’s Growth Domestic Product (GDP) is growing again, University of the West Indies (UWI) Professor of Economics Roger Hosein believes that the business sector will only fully benefit once there is a reduction in the crime wave that has swept the country.
He said in 2022, the economy returned to growth which has continued in 2023 and this opens up opportunities for the business sector.
“The challenge for the small and medium enterprises is beyond the economic growth situation. I think it is about how do you prevent a man from locking your neck after you have finished selling doubles 10pm in the night. The real challenge in the context of an economic depression or in an economy now coming out of an economic depression with 607 murders last year and almost close to 470 murders this year is how do you manage crime while you are struggling to make ends meet with a low level of economic activity.”
Hosein spoke on October 26 at a virtual post budget forum hosted by the Cipriani College of Labour and Co-operative Studies, Valsayn. The theme of the forum was “Looking for answers on how the budget affects you as a worker.”
Hosein praised the T&T Police Service (TTPS) for capturing illegal firearms in Santa Cruz recently, among other successes.
“Yesterday or the day before, they also made a bust with cocaine. I am seeing more and more work being done by the Police. That does not mean the small and medium enterprise person is free to work until 12 at night. It means small and slow steps are being made in the right direction and it’s important that we acknowledge that. What I would say is that it’s really scary being out there and being a businessperson and while we may have made strides in the last few months, in order for the small and medium business person to benefit from the return to economic growth, we need the right enabling environment.”
Hosein also commented on the country’s low unemployment rate saying while the 3.7 per cent statistic is accurate, the broader picture is that the country has a large population that is economically inactive and are not looking for jobs and this is not good.
During his budget presentation Finance Minister Colm Imbert indicated that the country’s unemployment rate is currently 3.7 per cent.
“While you see the unemployment rate is very low, the economically inactive population who are not in the labour force is very high. It is about 478,800. If you look at persons with jobs, you would see in 2014 we had 623,300 people. The Minister is not wrong but because a lot of people dropped out of the labour force between 2015 and 2023. So, if you lose your job and drop out of the labour force and you are not counted as unemployed, you would see a very low unemployment rate. The Minister is not wrong at all, except that the story is incomplete and the real tragedy lies in the number of people who are economically inactive. We have a lot of work to do to recover the labour market.” Hosein said.
New economic model
Trade and investment consultant Taharqa Obika, who also addressed the post-budget forum, spoke about the changes in the national economy from post independence to the 21st century.
He argued that locals now own a greater share of the economy than in the 1960s and 1970s and now more emphasis must be placed on developing the small business sector.
“Historically, as a young person who entered the labour force in the 1970’s, you would have looked at the Government on one end or to a foreign company on the next end to get a job as the foreign companies controlled the commanding heights of the economy. Those days were the last vestiges of colonialism. The Government was trying to find its feet in terms of avenues for employment. The households did not create much employment in terms of large scale industrial development.”
He said 50 years later, the country has successfully taken over much of the commanding heights of the economy.
“The Government has taken over lands from Caroni, lands from estates that the colonials controlled. Local families are now investing to the point where they are now spreading their wings. There are T&T-family businesses operating in Guyana, up the islands. Republic Bank, which is owned by the people of T&T is in Ghana, First Citizens Bank is all over the Caribbean. So the business model of the country has changed from calling on the foreign investor to solve our problems, to how can we as a people invest in our community and what is the Government doing to help me as a small or a medium investor.”
Obika said the developmental question in the 1960’s and 1970’s was how T&T’s citizens would get control of the commanding heights of the economy away from the former colonial master. However, he said the developmental question today is not that but how can one’s family be able to invest.
“This means more eTeck parks and smaller scale parks so that people can invest. Within the budget you will see some aspects of that. Of course more is always necessary. An entrepreneur in every family should be the aspiration as a people.”
Chief Education Officer of the Oilfield Workers’ Trade Union (OWTU) Ozzi Warwick who also spoke at the post budget discussion said that the Government must not only use economic data to determine how well the country is doing, but must raise the standard of the man on the street.
“The management of an economy is not for someone to boast about the GDP increasing. It’s about your standard of living as a citizen of a country. So GDP increasing, decreasing and all the numbers that you hear and about closing the deficit gap sounds nice, but my landlord is waiting outside for rent. I have no job. When you hear policymakers and politicians and bourgeois economists and commentators rattle off a few things, it means nothing if the standard of living of our citizens is falling.”