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‘Tighten your belts’, T&T PM tells citizens

Published:Wednesday | December 23, 2015 | 12:00 AM
File The drop in olil prices has partly being blamed for the recession in Trinidad.

Prime Minister Dr Keith Rowley on Tuesday said his administration is moving towards reviving the ailing economy of the oil-rich twin-island Republic and avoid going to the International Monetary Fund (IMF), as he urged citizens "to acknowledge that we don't have as much as we would like, so there are going to be some restrictions on spending".

But Rowley, who became head of the Trinidad and Tobago government after he led his People's National Movement (PNM) to victory in the September 7 general election, said he does not want his administration to be classified as "an austerity government".

"Austerity is not the word, it is common sense. We are not in a restricted programme. In fact, we want to ensure that we don't end up in a situation where we are governing by ... austerity," he said.

"If we don't manage our affairs properly, we could end up in a situation where we don't have options available to us. Right now we have options, and the options are to behave properly and acknowledge the circumstances and choose the best of the options that we have," Rowley told listeners of Citadel radio.

without options

He reminded them that countries that don't do so "and postpone the day, hoping that the next sunrise will change things on its own, end up without options, and they will end up with a final option, which are decisions being made for you by the lender of last resort," he said in reference to the IMF.

"We don't want that at all," he said, adding that the job cuts, wage freezes and other fiscal measures underscore the financial situation facing the country.

Rowley said the message being sent to the population is simple. "These are our circumstances. For example, let's take the borrowing limit. If we did not borrow, or if we don't set about to borrow, the country would not have been in a position to pay its bills and those payments for those bills are what keep the economy going ... and also, we can't initiate any activity ... to keep your economic growth going."

The prime minister said "the fact of the matter is that our ability to borrow was severely

circumscribed because the legal limit had been reached. The Parliament authorises the government to borrow up to a certain limit. The last government had that limit, like any government has, but at the time when we came in, the borrowing levels were up at the top, so if any borrowing was to take place, we had to go to the Parliament and get the ceiling lifted to allow this government to borrow".

stagnant economy

Earlier this month, Central Bank Governor Jawala Rambarran said that Trinidad and Tobago had "officially" gone into recession and Rowley said he had no difficulty with the statement since during the election campaign his party had always indicated that the economy had become stagnant.

"You have to diagnose properly before you can prescribe, and we were of the view that the economy was not growing. We went through an election campaign ... and during that period we were saying that the economy was not growing. The government of the day was saying it was growing, the minister of finance was saying it was growing by 1.2 per cent and we were saying we were not seeing this," he said.

"So we are not surprised to hear that the country is now in a recession ... ; the country was in a recession for the last year. What we were surprised about is that we are only now being told from those quarters," Rowley said, adding that his administration still does not have any official "number' to indicate that the oil-rich republic is in a recession.