This year, 2017, is expecting to be a year of recovery for T&T. Despite the trying circumstances of 2016–now compounded by strike signals from the Oilfields Workers' Trade Union (OWTU)–Finance Minister Colm Imbert has projected recovery for T&T in 2017. This was his response when asked about T&T's direction for the new year.
The Central Bank on Friday indicated that in November it had stated that it considered growth of 1.5 per cent "to be a reasonable projection for 2017." T&T's economy was estimated to have declined by approximately 4.5 per cent in 2016 following contractions in 2014 and 2015 due to energy sector deterioration.
Imbert's view of a 2017 recovery was also stated in government's 2017 budget. Last week, he confirmed the budget's position on recovery stands.
In the budget, he explained, the Government had embarked on a fiscal plan aiming to achieve overall budget balance by 2020 via reforms and changes to reduce energy revenue dependency, as well as containing government expenditure.
Measures towards this included elimination of waste, corruption, and movement away from subsidies and discretionary transfers. Focus would be on spending on essential economic infrastructure.
The economic state of play, implementation of projects and programmes for recovery and projected challenges are expected to be among discussions at a retreat of the Rowley Cabinet being held immediately after tomorrow's public holiday, the Guardian confirmed last week.
The retreat on January 3-4 will be at the Diplomatic Centre, St Ann's. It will be the second such retreat after the Government's first in February 2016 in Tobago. Government officials said the retreat includes focus on implementation schedules for 2017 budget projects, including for Tobago, now preparing for the January 23 Tobago House of Assembly polls. The ruling PNM launches its THA campaign on January 8 at Market Square, Scarborough.
Other sources said the retreat focus will also be on ensuring ministers take responsibility for tasks since there have been concerns about some 2016 performances. The retreat ends the day OWTUplans to serve strike notice. However, the retreat was in the works before OWTU's action.
The new year focus is also on the "bang" that 2017 has opened with, following breakdown of OWTU/Petrotrin wage negotiations at Thursday's marathon meeting. OWTU last Friday said it will serve strike notice on Wednesday.
Unless averted, how OWTU's strike could affect government's recovery plans remain to unfold since legal strike action can be taken uninterrupted for three months–up to March, including the busy Carnival period–which could affect T&T's economy.
Last Friday, OWTU boss Ancel Roget warned citizens to stock up. Petrotrin management, however, has assured contingencies are in place. Labour officials said that Government was working on the matter. Government sources noted that globally oil companies have had to cut costs in the oil price downturn.
In the 2017 budget Government had said discussions with OWTU will be held "early in 2017" to see how to resolve Petrotrin's many issues.
The budget noted a range of "far-reaching measures" are needed to guarantee Petrotrin's "very survival" and that it needs to cut operating expenditure by $500 million over the next four years or increase profitability.
This requires reduction in spending, review of the organisational structure, stringent control of operating costs and other measures which are "absolutely necessary since a robust restructuring programme will be a pre-condition for rescheduling Petrotrin's huge debt burden."
Initial discussions had started and OWTU was expected to issue its recommendations.
The 2017 budget
The budget stated T&T's medium-term framework is predicated on resumption of economic growth starting at one per cent in 2017, increasing to two per cent annually in 2018-2020.
It was projected the recovery in growth would be based largely on energy sector rebound, new oil/gas discoveries coming onstream, and expected turnarounds in other major sectors, particularly construction and manufacturing.
Projections are for oil prices–(US)$50 this year and (US)$60 in 2018, which would aid petroleum revenue recovery from $2 billion currently, to $14 billion by 2020.
From this year also, steps will be in force to reduce tertiary education expenditure, and also on Cepep and URP.
UNC FINALIZES FATCA STANCE NEXT WEEK
Meanwhile, the Government's retreat ends just before the January 6 resumption of Parliament when the crucial FATCA legislation returns for Government and Opposition deliberations, at the stage of a vote.
Last Friday, UNC's Suruj Rambachan said further stakeholders' meetings on the issue had not come off, but the UNC will caucus this week to confirm its position. He could not say if UNC would shift from its hard-line call for Joint Select Committee scrutiny of the bill.