Dr Bhoendradatt Tewarie
The years 2016 to 2020 were not good economic years as the record shows. At least three reasons for this are low production of oil and natural gas, the depressed prices of energy commodities generally, and national policies that did not generate business and economic confidence. Then came COVID with its several lockdowns, health uncertainties, job losses and social dislocation which caused a bad situation to worsen considerably. Five budgets did not get us out. The sixth budget, caught up in COVID, provided limited relief for families but little else.
It would be foolhardy of the human race and the people of Trinidad and Tobago not to recognise that the COVID years–from about March 2020, when it became a worldwide pandemic, till perhaps the end of 2022–are watershed years. The years in which most economies would have opened up as human societies learn to live with COVID and hopefully, a significant part of the human race vaccinated. A period in which economies would have been severely disrupted and the world economic system, society, the social order, social behaviour, ripped away from the lives of human beings loved ones in the millions, and pushed technology to play an enhanced role in human communications, transactions of all kinds, the conduct of business, the practise of politics, the modes of governance, the delivery of education and even expressions of empathy.
All of this notwithstanding, we still don’t know if COVID started because of people eating bats from a market, from experimenting with bats in a lab or from a lab experimenting with the creation of a virus.
And the debate about vaccinating or not vaccinating will only prolong the human and economic agony and create opportunities for worsening conditions. You can’t have 24 months like this and continue to think in the same way about the present and the future–about life and living, about home, work, education, community, society, economy, values, priorities. Any annual budget would have to take this into account.
It is estimated that US $20 trillion have been pumped into the financial system because of COVID. $19 trillion have gone to the industrialised world. Would that make this COVID period a watershed period of economic and financial history or not? I won’t answer, but I ask you to reflect on that.
During the 2009 financial crisis, the IMF injected $250 billion US to restore market confidence. For COVID they are willing to plough almost three times as much–$650 billion US into the global financial system. This is in addition to the rapid credit facility offered to the poorer nations early in the pandemic doubling access to funds for poor countries and an additional $250 billion allocated for debt emergency relief. Does this make this COVID period a watershed period in economic and financial history or not? As I said, you think about it.
What has the COVID pandemic revealed?
What has the COVID pandemic revealed about the world’s economic condition? First of all, that the need for facts and accurate data is at an all-time high–and timely data is of the essence. Secondly, the value of trusted data has increased in the age of misinformation. It is impossible in this country to have timely, accurate, trusted data. Facts are hard to discern. Just look at the matter of the NGC investment expenditure on Train 1 in Atlantic LNG, or examine the issue of the appointment of a Police Commissioner. These have both revealed vulnerabilities and structural deficiencies in a way that we never saw before. What is the truth? Where is the line between politics and good governance, including good corporate governance to be drawn?
So it’s not only numbers, accuracy, timeliness and trustworthiness of things, but it is truth itself.
So if any society and economy are going to “build back better,” to use the term of the United Nations, we must acknowledge how the conditions in the context of economic challenges are different this time, and we must take time and make effort to reformulate and redefine the problem before jumping to proposed solutions.
The problems as defined before may no longer be relevant because now we need to identify different questions and the way we conceptualise the problem may change as well. So it might well be time to reformulate the questions and redefine the problem.
The first thing is that instead of looking at the many problems and challenges we have, we, perhaps, should work from the future backwards to determine what to do now. Anything else might prove to be too constraining and debilitating. If you start with revenue, expenditure, deficit, debt–you are going nowhere because, first of all, there is too little room and too many constraints. Secondly, there is nothing to inspire and, therefore, little motivation to take radical action.
Radical in the way I am using it here means a far-reaching or thorough action to alter the fundamental structure of the economy and social order. You can only do that if you are not being sucked in the quicksand of the present. You can only do that if you break the shackles of precedents and wave away the temptations of orthodoxy to see the future looking at you brightly, despite the darkness that surrounds you, beckoning you forward to present innovative, sustainable solutions for a re-structured country and world.
Suppose we say that Trinidad and Tobago WILL BE a smart island economy, modern, knowledge-based and technologically driven. Aligned to world progress, focused on creating good jobs and income, generating entrepreneurship, business on a landmass, surrounded by ocean, consisting of seven sustainable islands. Adapting to climate change and its impact, committed to a renewable, sustainable economy that attracts social entrepreneurs and traditional investors.
Suppose we say that these islands will be custodians of an ecological treasure, environmental pleasures, cultural thrill and inspiration, peaceful environmental retreat in a human environment of racial harmony, social cohesion, religious tolerance in which the dignity of all human beings is reinforced by mutual respect in attitude, disposition, behaviour and exemplary leadership.
It will be a society that recognises merit, addresses injustice, creates opportunities for all and strives for equity and social balance. Its quest for sustainable development will emphasise the values of equity, and inclusion and social justice.
Adjustments and transformations for the future
If a vision like that pulled you forward, you would know that immediately that, on the back of internet-based government services, E-business, remote working and online learning, the immediate task is to build a smart economy and society with smart businesses, smart government, smart institutions, smart schools and learning institutions and well trained technologically savvy people.
The job of the Ministry of Digitalisation would be to get that done in two years by building effective partnerships with budget funding in fiscal 2022 and again in fiscal 2023. That should be our principal task, to ready ourselves for a world of automation, the internet of things, robotics, artificial intelligence and the fourth industrial revolution.
If we are not preparing for that world then what are we preparing for? And what is the point of preparing for a lesser world? So we have to make up our mind that we are going there, disrupt whatever has to be disrupted, fix whatever can be fixed, shut down, close or discard whatever needs to be abandoned to go forward and upward, and make the adaptations, adjustments and transformations that the future knowledge-based technologically driven, competitive world demands.
This requires collaborative, national efforts to achieve a clearly defined goal of a smart, knowledge-based, technologically proficient economy and society. Confrontation has to be left behind, but consensus on how to achieve our goal and the rules of the various sectors can only be built by plain talk, honesty and mutually respectful engagement that recognises the value of differences of opinion but the necessity of mutual compromise in achieving agreement, and the full recognition that agreement must be reached in order to get anything done with collective effort and energy. Government, business, labour unions, NGOs, citizens at large must really be in this together, for a common purpose, which is to redeem ourselves, rehabilitate T&T, revive the economy, put people back to work, start economic recovery, expand commerce, achieve growth, support ourselves better, export more, create opportunities for all who are willing to try and to strive.
But we can’t be building infrastructure, structure, framework, institutional capacity, knowledge system, intellectual capital, social capital and know-how for a world of the future as if we did not know that some homes and communities don’t get water for weeks. So we must make potable water for every household a priority. Water is essential, especially with COVID. We cannot ignore the fact that we have a problem of producing enough food to feed and secure the nation and that we do not have the foreign exchange required to continue to import at the level we do now. So meaningful import substitution and significant reduction of imported food have to be a priority.
Thirdly, we know that climate change will bring more rain and more severe drought. We know that when more rain comes we will have floods. We know that water is a problem in the dryer season for agricultural production and animal farming. We know that in the rainy season flood destroyed crops. We know that agricultural roads are a problem, irrigation systems are largely non-existent, that land tenure for farmers stands in the way of production, investment, farmer security. We know that rainwater harvesting hardly exists. That solar power on farms is yet to happen. We know that land-based agriculture is risky, we know that greenhouse technology produced by the University of the West Indies and the University of Trinidad and Tobago can be successful. We know that resistant crops with higher yields can be made possible by sustainable systems developed by UWI. We know that in limited space, and controlled environments, we can grow almost anything in any quantity we want applying the right technology, nutrition system and monitoring technology accessible and manageable on a mobile phone.
So producing enough food in today’s world for 450 homes, 1.4 million people is not a complicated problem. But once you set targets and production systems are set in motion you have to organise, manage, coordinate and design a system to market, and on the table in the household, the plate, that works. The price of everything we import is up. We must strive to produce more of what we consume; import substitution strategies have become a necessity.
Moreover, countries with a sound technological platform are now competing ahead of us and it will be harder to export. But export we must because it is the lifeblood of our foreign exchange line of life. Moreover, the G20 countries are agreeing on a minimum corporate tax structure, with a low tax of about 15 per cent which may well have the effect of circulating investment among industrialised countries and keeping out investment from countries such as ours. We cannot proceed as if these things do not matter to us or will not affect us.
To be continued next Sunday.