Tuesday, January 16, 2018

Sober debate needed on T&T economy prospects

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Mark Fraser

 Assessment of T&T’s economic standing and prospects appears, unsurprisingly, to have become caught up in the national tendency toward the throwing of words across political and other lines. The attitude was displayed even by some businesspeople at a T&T Chamber-organised session on foreign exchange availability, involving Central Bank Governor Jwala Rambarran and Bankers Association president Larry Nath. 

Until finally resolved to their satisfaction, trouble in finding foreign exchange when needed will continue to irritate businesspeople. Inevitably, such difficulties will feed criticisms by the political opposition, recalling that Governor Rambarran had been appointed under the People’s Partnership, and asserting that his performance reflects on the present administration.

With significance extending beyond immediate met or unmet foreign exchange needs, however, upbeat updates such as those given by Planning Minister Bhoe Tewarie and Energy Minister Kevin Ramnarine are inevitably disparaged and discredited, such that the public is at a loss to know which message to trust. 

Dr Tewarie has hailed resumption of economic growth, increased GDP, general business expansion, and the larger share of GDP contributed by activity in the non-energy sector. Mr Ramnarine has projected US$9 billion in energy sector investment in the next three years, and promisingly improved oil production at Trinmar, all to the end of affirming the buoyancy of T&T’s energy future.

Over all of this, cold water was discouragingly thrown when economist Roger Hosein addressed his book-launch event. The UWI economist portrayed the economy “on a slippery slope”, having lost the LNG market in the US. 

He queried the advisability of continuing to export similar volumes of liquefied natural gas, as against utilising it for local industrial development. 

Fundamental changes have reshaped the international natural gas market, arising from US emergence as a major energy producer no longer helplessly dependent on imports. Such changes inevitably pose challenges for a T&T whose LNG exporters, used to enjoying lucrative Stateside markets, have sought and found buyers elsewhere. 

Dr Hosein went further, however. He also assailed the policy and practice whereby an over-large share of income derived from depleting energy resources is devoted to fuel subsidies, welfare transfers such as CePEP, and generally to privilege consumption over economic production and diversification. 

Is the economy on a “slippery slope”, or is it rising to higher heights? This should be the subject of sober, well-informed and, to the extent possible, unbiased national discussion, suitably led perhaps by the UWI or other higher education institutions. Until such exercises, the general public can only remain confused, as ministers, opposition figures, and experts contradict each other about whether the economic glass is hopefully half-full or disturbingly half-empty.