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Prime Minister Dr Keith Rowley

It is not often that one hopes that they are wrong and will be proven so in the public square. But as I write this article I hope that I will be shown to be wrong because if that happens the country will be better for it.

I say this because I believe that over the next five to ten years there is an urgent need for transformative government and from the selection of key members of the new Cabinet my fear is the Prime Minister has decided that continuity is more important than transformation.

The notion that he would re-appoint a Finance Minister because Mr Colm Imbert is not faint hearted and is familiar with the country’s finances and the Ministry, is an unconvincing argument. It is analogous to saying to a West Indian batsman that I know you have an ordinary batting average against England but I will pick you because you have the experience of playing against them. In other words I am prepared to do the same thing and expect a different result.

The country has too many big problems to put off change and while change is difficult, an often times messy, it has to be done, so that the students who by 2021 are expected to be without school for almost a year will have a future in a country blessed with so many resources but unable to focus sufficiently to achieve its full potential.

It was a little over two weeks ago that T&T returned to the polls and re-elected the People’s National Movement to government. During that time we had the unseemly attempt to sow the seeds of doubt about the results by the use of recounts that never had a chance of success and people who should know better egging on UNC supporters to somehow believe that they had been cheated out of an election victory. We have even seen a kind of intellectual dishonesty that tries to push the narrative that the UNC got the popular vote in Trinidad and had it not been for the votes in Tobago the results would have been 20/19. First of all the election was for Trinidad and Tobago and secondly the day we start to break it up into regions then we will have to say who got how many votes along the East/West corridor or the industrial capital, or the deep south and so on. None of this is in the interest of T&T and all designed to keep us distracted from the hard work of nation-building ahead of us.

As I have said before the country is facing an economic crisis that is in part of its own making and partly due to two major global events.

The COVID-19 pandemic has caused economic pain to almost every country on the globe. Those that were able to manage it well and had strong macro economic positions seem to be riding out the storm better than others. Even the United States has been brought to its knees by the pandemic with tens of millions out of work. The World Bank has estimated that the global economy will decline by 5.2 per cent in 2020 with most countries being plunged into recession and the largest fraction of countries contracting since 1870.

Further, it expects that the advanced countries will see on average their economies shrink by seven per cent.

For T&T this comes on the heels of five years of consecutive negative economic growth caused by the collapse of commodity prices and lower production.

This leads us to the second major global event that hurt T&T’s economy, and why the situation screams for transformational leadership and a diversification of the economy.

Improved technology allowed oil and gas companies to drill in the deep-water and discovered huge reserves of hydrocarbon that would not have been possible to find 30 years ago. The Guyana discoveries, those in the Gulf of Mexico and in several West African countries all speak to this reality. It is this technology that has also improved the rate of discovery as better imaging and interpretation of the sub-surface have resulted in more oil and gas being discovered that surpassed demand which has not matched production.

Technology also allowed US producers to extract large amounts of oil and associated gas from shale increasing its crude production by millions of barrels. It meant the US became a net exporter of oil and gas, it changed the word’s geopolitical context and placed pressure on prices for LNG, Petrochemicals and crude oil. All crucial export earnings for T&T.

Add to that T&T’s crude production has been falling in part because we have never gotten Enhanced Oil Recovery going, a tough fiscal scheme for onshore and near shore exploration and production and the reality that most of the onland acreage is controlled by the state company which has not had the resources to fully explore them.

The price of natural gas in T&T has risen significantly and made the downstream sector uncompetitive.

The country’s low levels of productivity, archaic operations of its public service, the difficulties in doing business and a seemingly forever crime problem, these are some of the challenges we faced even before covid and therefore as a country we have to be laxer-like focused on finding solution, and these are not going to be easy. There is nothing in what we saw from the Rowley administration over the last five years that suggest that Ministers Imbert and Energy Minister Franklin Khan can be what we need at this stage. Two crucial portfolios.

On the issue of Mr Khan, I have known him for many years. He was once my MP and I have no doubt about his knowledge of the energy sector. We all know Mr Khan has had his health challenges and from all reports in the Ministry does not have the kind of energy needed to deal with what is a virtual crisis in the sector. Several petrochemical plants remain shut because it is uneconomical for them to produce at the price point the global methanol and ammonia are being traded at, the NGC is a shell of its financial self, it has yet to release its annual financial report months after it was due, National Energy continues to fail to produce any results as it relates to the attracting heavy gas-based projects to the country, upstream drilling is limited, gas curtailment remains an issue. These are all hard problems to solve and take a lot of work. For the country’s sake I hope Mr Khan will be able to deliver on these issues better than he delivered on bid rounds in the last five years.

Mr Imbert’s first two years were well received. He reduced government spending, cut the subsidy on fuels, stabilised the economy, but brought no new ideas on how to grow it. He was like the proverbial book keeper, able to balance the numbers but not able to advance a plan to grow the pie.

He will have to deal with depressed commodity prices, falling profitability of companies, reduced fiscal space to borrow, having raised considerable sums to meet the budgetary shortfall.

So he meets another tough situation, perhaps worse than he did in 2016 and with fewer options. It will be a tall order staying afloat.

Can Mr Imbert deal with the big items like transfers and subsidies and will we ever see pension reform?

IN her 2009 budget speech, former Finance Minister Karen Nunez Tesheira told the Parliament, “Mr Speaker, the Government’s liability in respect of the current pension arrangements had previously been determined to be between $21 billion and $30 billion as at January 1, 2007. We believe therefore that it has become necessary to address this situation expeditiously in a manner that is both beneficial and sustainable. We plan to complete our consultations before the end of the first quarter of fiscal 2009 with a view to implementation by 2010.”

In 1994, at my first press conference as a journalist, the late Ken Valley also spoke about pension reform being a priority. Nothing has been done to date.

We can no longer put off the imperatives of our time. It is why these appointments suggest to me that there should be no great expectation and while I hope I am wrong, we may very well lose another opportunity to make the changes needed for a more sustainable economy and society.