TT protected from financial crisis

WISE ECONOMIC strategies implemented by Government since 1993 have protected Trinidad and Tobago from international economic and financial crises and turned TT into an international financial centre today.

This was the opinion articulated by Minister in the Ministry of Finance, Christine Sahadeo, when she addressed the opening of a Caribbean Single Market and Economy (CSME) conference at the Cascadia Hotel, St Ann’s yesterday.

Listing the economic and financial crises experienced by nations such as Mexico and Russia over the last decade, Sahadeo said TT took immediate remedial action when it experienced a similar crisis in the late 1980’s when international oil prices crashed. The minister said starting with the pivotal decision by the then George Chambers administration to adopt a floating exchange rate and eliminate all controls on current and capital transactions since April 1993, Government has been taking steps over the last 15 years to modernise and liberalise the national economy to help protect TT from external financial shocks.

Sahadeo said that with global oil prices currently hovering around US$75 per barrel and unlikely to fall any time in the near future, it was important that Caricom nations use this period to ensure that their economies are “healthy and efficient” She said while the global economic expansion now being witnessed can be a blessing to Caribbean nations whose growth and stability prospects are highly susceptible to changes in the international environment, there was little room for complacency “as the Caribbean remains dangerously perched on several fronts when it comes to maintaining financial stability.” “So far in 2006, macroeconomic performances have been generally stable,” she added.

Identifying public debt and fiscal performance as two areas of concern for Caribbean economies, Sahadeo said many regional governments have been trying to bring down the former through a variety of financial strategies over the last five years and the latter has deteriorated in almost every Caribbean nation.

Coupled with trade uncertainties from the European Union and the World Trade Organisation, Sahadeo said there could be “a serious drag on fiscal and growth prospects” for oil-importing Caribbean nations if global oil prices continue to increase.

The minister explained that all of these developments underscore the need for regional economies to develop strong financial services sector and this is precisely what TT has been doing.