Vasant: Bond at expense of business boost

“A further increase in the public debt and the decline in the Ease of Doing Business ranking for TT are worrying indicators of an economic meltdown,” he asserted.

“The recent floating of a TT$500 million six-year bond, now surreptitiously upsized and doubled to $1 billion, makes clear Government’s ill-fated policy of increasing public debt for non-investment and non-productive spending.” Bharath lamented that TT’s debt level is now escalating out of control, having risen $14 billion in the past year alone. He alleged, “The Government’s main policy instruments for raising revenues are increased levels of taxation on an already beleaguered population, as well as increasing public debt”.

Bharath said recent Central Bank data gives a dismal outlook for the economy with declines in the energy and non-energy sectors of 10.7 percent and 10.9 percent respectively, with no economic strategy to restore confidence, stability and growth He said an eight percent drop in the economy in the second quarter of 2016 was the worst ever quarterly contraction in the country’s history, according to the Bank’s November 2016 Monetary Policy Report.

Bharath blamed the energy sector’s woes on continued gas-supply shortages, maintenance shutdowns and weak energy prices. That sector also pulled down the non-energy sector.

He lamented a worsening current account deficit of US$1 billion, plus a worsening unemployment rate of 4.4 percent.

Bharath said economic deterioration will also be fuelled by a decline in the Ease of Doing Business for Trinidad and Tobago.

While in 2014, the World Bank lauded TT as one of the world’s “top 10 reformers”, by 2016 TT had fallen to a rank of 96 with the World Bank saying it is now tougher to do business here.

“Recent reports have stated that with ‘95’ being the break-even point, the drop was enough to knock TT into the half of countries where it is more ‘difficult’ rather than ‘easy’ to do business,” bemoaned Bharath.

He urged serious action to stem any further fall in this ranking is required to ensure that the rank does not further deteriorate, especially in a time of severe economic decline