What’s Our Economic Situation?

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Our Government can’t seem to get its story straight regarding the state of the local economy? Either they don’t really know, or they are the greatest spin doctors ever, bending developments to suit their narrative and agenda. These harsh words come in the wake of the latest assessment by the ratings agency Standard and Poor’s. T&T’s long term foreign and local currency sovereign credit ratings went from BBB+ to BBB. Prime Minister Dr Keith Rowley has responded in a worrying way: he said T&T “still has serious difficulties” and assured that his government remains ready and willing to take the hard decisions necessary for the good of the people. He also insists that S&P’s forecasts for reduced oil and gas production will not come to pass. That’s because according to the PM, his recent gas trips will make a difference to the local sector, while Heritage is now drilling oil wells while Petrotrin wasn’t. Both of these assessments were delivered by the PM on a political platform, just hours after the S&P ratings were made public.

Firstly, the Prime Minister’s acknowledgement of “serious difficulties” contradicts an assessment from the Finance Minister during his mid-year budget review back in May 2019. At that time, the Minister said Government had managed to stabilize the local economy, keep people in jobs, keep the country running on an even keel and return the country to growth. He also lashed out at those who disagreed, referring to them as pessimists spreading propaganda. Now we are hearing that hard decisions need to be taken, and that we are still in difficult times. Why is one Minister spinning a story of economic hope and recovery, while the Prime Minister himself is using the term “serious difficulties”? What is the TRUE assessment? Where do we really stand?

Secondly, it concerns us to see the flippant manner in which the Prime Minister dismisses an assessment from one of the world’s most trusted financial ratings agencies. While Standard and Poor’s held steady in its short term assessment, the long term assessment is a cause for concern, as it can affect foreign investment opportunities. Even if he disagrees with S&P’s predictions for local oil and gas production levels, wasn’t its report assessed properly with the relevant ministers and advisors instead of mounting a political platform within a matter of hours to deliver political rhetoric? Many local experts are also concerned by the apparent lack of concern with the assessment. UWI Economist Dr Vaalmiki Arjoon had previously warned of a downgrade if nothing was done to improve fiscal management and fix weak institutions. He is now warning that global investors will not be turning a blind eye to this latest development.

We need truthful answers. How can we move forward if we don’t even know where we are?