I have as­signed a fail­ing grade to the PNM Gov­ern­ment af­ter as­sess­ing their stew­ard­ship on the econ­o­my over the past four years. When it as­sumed of­fice, it de­cid­ed to en­gage on a pro­gramme of sta­bil­i­sa­tion and con­trol of Gov­ern­ment ex­pen­di­ture which, at the time, I en­dorsed as a short-term mea­sure. Af­ter four years, how­ev­er, the Gov­ern­ment still seems to be in sta­bil­i­sa­tion mode at a much low­er lev­el of na­tion­al pro­duc­tive ac­tiv­i­ty but with an es­ca­lat­ed lev­el of bor­row­ing, which all seems to be ab­sorbed in meet­ing cur­rent ex­pen­di­ture and very lit­tle ex­pend­ed on projects geared to­wards growth, de­vel­op­ment and di­ver­si­fi­ca­tion.

It was not just a ques­tion of con­trol­ling ex­pen­di­ture but its re-ori­en­ta­tion to pro­duc­tive ini­tia­tives by re­strict­ing out­lays on non-pro­duc­tive ac­tiv­i­ty.

Af­ter four years there is lit­tle in­di­ca­tion that there was any no­table at­tempt at redi­rect­ing ex­pen­di­ture for eco­nom­ic re­form or di­ver­si­fi­ca­tion.

The need was not on­ly for the re­de­f­i­n­i­tion of pub­lic sec­tor in­vest­ment ex­pen­di­ture but for poli­cies, pro­grammes and in­cen­tives for high­er lev­els of pri­vate sec­tor in­vest­ment, be it for­eign or lo­cal. In its 2015 Man­i­festo (p. 17), the PNM stat­ed, among oth­er things, that the key ob­jec­tives of its eco­nom­ic poli­cies would in­clude “….in­vestor con­fi­dence…sus­tain­able growth and di­ver­si­fi­ca­tion…and job cre­ation.” On all counts, the Gov­ern­ment has failed. There has been al­most an ab­sence of for­eign or lo­cal eq­ui­ty in­vest­ment in the econ­o­my.

While there has been some in­vest­ment by way of loans from the Chi­nese, the ser­vic­ing of these loans will be sub­ject to the vi­a­bil­i­ty of the projects in ques­tion, oth­er­wise, they be­come mill­stones on Gov­ern­ment fi­nances. Fur­ther­more, T&T has fall­en fur­ther be­hind in the in­dex of the ease of do­ing busi­ness and now stands at 105 among coun­tries of the world. In­cen­tives to en­cour­age in­vest­ment are patent­ly lack­ing.

In the years since 2015, ac­cord­ing to IMF sources, the econ­o­my has record­ed neg­a­tive growth of -6.5 per cent for 2016, -2.0 per cent for 2017, .03 per cent for 2018 and 0 per cent for 2019. The Gov­ern­ment’s pro­jec­tion for pos­i­tive growth in 2019 is based large­ly on in­creased gas pro­duc­tion com­ing on stream now due to ex­plo­ration in­cen­tives pro­vid­ed by the pre­vi­ous PP gov­ern­ment. The promise of growth, there­fore, has been still­born and, even if mar­gin­al­ly achieved, may not be sus­tain­able if pro­duc­tion in the en­er­gy sec­tor and world en­er­gy prices re­main sub­dued.

How­ev­er, with the promise to di­ver­si­fy the econ­o­my to de­vel­op a broad­er base for sources of rev­enue, for­eign ex­change and em­ploy­ment, the Gov­ern­ment has record­ed one of its great­est fail­ures. This is not to say that di­ver­si­fi­ca­tion is ef­fort­less or eas­i­ly at­tain­able in the short term. The Gov­ern­ment’s fail­ure to se­ri­ous­ly and mean­ing­ful­ly fo­cus on this ob­jec­tive and un­der­take even mod­est steps to pur­sue it has been ob­vi­ous. Even non-en­er­gy sec­tors with some po­ten­tial have fared bad­ly in the last four years. The tourism sec­tor con­tin­ues to con­tract.

The Busi­ness Guardian of 20/6/19 car­ried a re­port from the Caribbean Tourism Or­gan­i­sa­tion which not­ed a 2.2 per cent de­cline in T&T’s tourism sec­tor, while the Caribbean re­gion as a whole record­ed dou­ble-dig­it growth. The Gov­ern­ment’s flawed pol­i­cy was to re­ly on one sin­gle project fund­ed en­tire­ly by tax­pay­ers with lim­it­ed ben­e­fits, which has now been aban­doned.

The Busi­ness Guardian of 19/8/19 al­so paint­ed a bleak pic­ture in agri­cul­ture, which now ac­counts for on­ly 0.4 per cent of GDP. De­spite Bud­get promis­es, lit­tle progress has been made in the sec­tor. The num­ber of farm­ers is shrink­ing. There is lit­tle re­search or tech­nol­o­gy up­grade and “there has been no in­di­ca­tion that agri­cul­ture, fish­eries and rur­al de­vel­op­ment have had any sig­nif­i­cant im­por­tance to the na­tion­al agen­da.”

The man­u­fac­tur­ing sec­tor has been neg­a­tive­ly af­fect­ed by sev­er­al fac­tors, in­clud­ing for­eign ex­change short­ages for crit­i­cal in­puts, an un­help­ful ex­change rate regime, bu­reau­crat­ic de­lays, min­i­mal in­vest­ment in tech­nol­o­gy, in­no­va­tion and skills de­vel­op­ment and low pro­duc­tiv­i­ty. Con­se­quent­ly, com­pet­i­tive­ness has de­clined and there is no iden­ti­fi­able Gov­ern­ment pol­i­cy to ad­dress it. Fi­nan­cial ser­vices as an area iden­ti­fied in the di­ver­si­fi­ca­tion thrust has seen lit­tle progress, while de­vel­op­ment of the mar­itime ser­vices Sec­tor is re­ly­ing on a sin­gle ini­tia­tive to be un­der­tak­en by Chi­nese loan in­vest­ment with its vi­a­bil­i­ty still in doubt.

In­stead of job cre­ation, the coun­try has ex­pe­ri­enced job loss­es in al­most every sec­tor in the last four years. As a re­sult, house­hold in­comes have de­clined and pover­ty lev­els have risen. Over the last four years, the Gov­ern­ment has failed to ad­dress the is­sue of mould­ing a work­force that is trained, dis­ci­plined, skilled, adap­tive, tech­no­log­i­cal­ly-em­pow­ered and in­no­va­tion-ori­ent­ed.