- NEWSDAY.CO.TT - A la Une - 07/Aug 02:53

First 100 days in office – A sliver of hope

SINCE THE UNC Coalition of Interests(UNC/COI) took office, people in Trinidad and Tobago have been waiting to see changes in many areas. When Prime Minister Kamla Persad-Bissessar was sworn in on May 1, she promised a safer and happier TT within six months. This came after the UNC/COI overran the PNM in the April 28 general election, based on campaign promises such as increased wages, additional jobs and meaningful opportunities, better security for businesses and the general public and economic growth. August 9 would make it 100 days since Persad-Bissessar was sworn in as Prime Minister. While 100 days – a little over three months – is not enough time to make good on most of the UNC/COI’s promises, for any government, the first 100 days are crucial for setting the tone, establishing priorities and building momentum on key policies. People were able to see what the government is capable of and what its core agenda is. Now, despite fiscal challenges, an ever-evolving crime network and external shocks from geopolitical challenges, economists and people in the business community alike are seeing a sliver of hope coming out of the actions of the government. New government, old problems The UNC coalition came into government at a time when TT was still reeling from significant global shocks coming out of covid19 pandemic and the Ukraine war. Upon entering government, the UNC also immediately flagged a number of questionable practices from the previous government, which could have led to it haemorrhaging money. The outlook on the nation’s fiscal fortunes was also less than desirable. [caption id="attachment_1170731" align="alignnone" width="1024"] Finance Minister Davendranath Tancoo and Minister of the People, Social Development and Family Services Vandana Mohit met with the World Bank team on June 11 at the Ministry of Finance's head office at the Eric Williams Financial Complex in Port of Spain. - Photo courtesy MOF[/caption] In 2024, S&P Global, despite giving TT a "stable" rating, noted that growth would be slow in the next two to three years, owing to declining oil and gas production. Economist Vaalmikki Arjoon noted that the government inherited a 16.8 per cent economic contraction that accumulated over the last nine years. It also faced a cumulative fiscal deficit of $71 billion and a significant consolidated fund overdraft of $46.5 billion in 2024. "The economy’s cornerstone, oil and gas production, experienced steep declines of 31 per cent and 33 per cent respectively, from March 2016 to March 2025. "Consequently, foreign exchange (forex) reserves drastically fell to US$4.9 billion by June 2025, a figure artificially propped up by external borrowing and withdrawals from the Heritage and Stabilisation fund (HSF)," Arjoon said. Central Bank governor Larry Howai, who recently replaced governor Alvin Hilaire, agreed that there was a "big fiscal issue" that needed to be addressed. "The deficit is large, the debt-to-GDP ratio is quite high. Therefore, some of the fiscal flexibility the government would like to have isn’t quite there. "Our foreign exchange reserves aren’t what they used to be. There are a number of areas that would need immediate attention in terms of how we go about in reducing the deficit that we have, what kind of timeframes we would need to be able to get that and how we deal with managing the foreign exchange situation given the demands by the public at large." This may have been why in her first post-cabinet press briefing at the Red House on May 9, Persad-Bissessar notified the public that her government inherited a $4.42 billion "hole" which needed to be filled in order to keep the country running on a month-to-month basis. In April 2025, total cash inflow was estimated at $3.95 billion and total cash outflow was estimated at $5.28 billion. This left a deficit of $1.33 billion, which was met from the Central Bank’s available overdraft cash balance. "By the end of April, the available overdraft cash balance was $3.67 billion, of which $2.74 billion was carried forward to May 2025," she explained. She said there was also an outstanding balance of unpaid cheques in the system valued at $500 million, which was also carried forward to May. May’s cash inflows were estimated at $2.38 billion, with an estimated outflow of $6.3 billion, resulting in a deficit of $3.92 billion for that month. If the unpaid cheques in the system were presented for payment, it would make the total deficit $4.42 billion. A billion-dollar deficit was not the only problem the government faced. The UNC coalition entered government amid a declining but still significant crime rate. On April 28, the murder toll was 126. The murder rate up to August 5, according to police is 232, meaning, there have been 106 murders since April 28. The murders have come along with a noticeable uptick in kidnappings. If that wasn’t bad enough, global shifts sent shockwaves of uncertainty across TT’s business sector, with US President Donald Trump levying a ten per cent (now 15 per cent) tariff on TT’s exports to the US as well as slaying the Dragon Gas deal with a stroke of a pen, reversing key OFAC licences that would allow TT to work with Venezuela without sanction. "What we know is that there is very little money in the treasury," said Dr Indira Rampersad, head of the UWI Department of Political Science, in a conversation with Business Day. "She (Persad-Bissessar) has to try to generate some income and revenue as soon as possible." [caption id="attachment_1170732" align="alignnone" width="1024"] Finance Minister Davendranath Tancoo (left) presents former finance minister Larry Howai (centre) with his instruments of appointment as Central Bank Governor, as Minister in the Ministry of Finance Kennedy Swaratsingh looks on. -[/caption] Noting that there will be a major budget proposal in the next coming months, Rampersad said while it was early days for sectors like construction to pick up, there are still a number of outstanding negotiations with unions such as the West Indies Group of University Teachers (WIGUT) and the Oilfield Workers Trade Union (OWTU). "Whatever it is, they will have to work out a method of payment, and that would depend on the availability of funds." Howai said TT may have to face even further challenges as the US tariffs on exports could affect TT’s petrochemical sector. "The numbers jump around and the US President seems to give a different figure almost every day, but the fact is, the last set of numbers we saw, it seems that our petrochemical exports could be affected." Arjoon also noted that the tariff could reduce export revenues, forex earnings and profit margins for local exporters in the non-energy sector. "(It would place) added pressure on the TT dollar’s peg to the US dollar. In response, the government is poised to engage in negotiations with US officials, aiming to secure tariff reductions on key exports such as energy commodities, chemicals, manufactured products, and processed foods." Laying the groundwork The economy The Prime Minister and her new government’s first moves surrounded an effort to fill the billion-dollar hole in the treasury and secure funding for both the public and private sectors. "Understanding that recovery will require time and strategic efforts, the administration appears to be implementing measures to curb excessive government expenditure, placing a high priority on enhancing fiscal accountability and transparency, particularly concerning state entities. "These proactive steps aim to restore investor confidence and ensure sustainable fiscal management," Arjoon said. On June 13, the Ministry of Finance hosted the World Bank in a virtual meeting, during which the bank's team presented the main findings, conclusions and recommendations of its draft final report under the terms of its Reimbursable Advisory Services (RAS) Agreement for the Social Protection Expenditure Review (SPER) and an Error and Fraud Assessment (EFA), signed on May 19, 2023. From May 26-29, a World Bank group also visited TT, hosted by Minister of Planning, Economic Affairs and Development, as well as the Minister in the Ministry of Finance, Kennedy Swaratsingh. Swaratsingh announced plans to secure up to US$5 billion in funding over the next three to five years to support private sector-led diversification initiatives through bilateral talks with the bank. Among visits made to TT since May 3, the two most important may be the two-day visit by India's prime minister Narendra Modi starting July 3, and Afreximbank incoming president Dr George Elombi who visited during TT’s recent African emancipation celebration. Modi, during his visit, opened the door to India, announcing that his government will be offering overseas citizenship of India (OCI) cards to sixth-generation descendants among the Indian diaspora in TT. He also gifted 2,000 laptops to TT’s students, which was a direct nod to Persad-Bissessar’s manifesto promise of laptops for schoolchildren. Elombi, in remarks at the African Emancipation Day celebration at Queen’s Park Savannah, Port of Spain, on August 1, offered TT a seat at its table, including it in its membership in the region and doubling approvals for the Caribbean from US$1.5 billion ($10.16 billion), to US$3 billion ($20.32 billion) in order to accommodate the needs of TT. Energy Moves have also been made in the energy sector. Minister of Energy and Energy Industries Roodal Moonilal visited Grenada to rekindle conversations on possible gas resources in the Nutmeg field. Moonilal was also present at the Suriname Energy, Oil and Gas Summit and Exhibition from June 17-20. During that time, he said the TT delegation met with Saatsolie, Suriname’s national oil and gas company, to discuss potential partnerships for gas projects. Speaking in Parliament on June 23, he said the Suriname company asked the TT delegation to work together, so it can benefit from TT’s expertise in commercial and contract agreements to support bids to market gas and energy products. TT is also expected to provide support for Suriname’s LNG expansion programme and offer TT as a hub for marketing Suriname’s energy products. Most recently, the government began talks with Exxon, where it was awarded seven ultra-deep water exploration blocks. Arjoon said the decision to partner with Exxon is expected to attract advanced technology in exploration and significant capital investment. "Exxon’s entry into our energy sector will notably enhance competitiveness in the upstream industry, stimulate additional investment, and generate higher forex earnings and revenues through increased production, taxes, and royalties paid in US dollars. "Such developments are crucial for bolstering forex reserves and stabilising the national economy," he said. The deal with Exxon may come in line with other campaign promises such as the reopening of the Guaracara refinery, which was shut down in 2018 during the Dr Keith Rowley's administration. At a post-Cabinet press briefing on July 10, Moonilal said a refinery committee was formed with former energy minister Kevin Ramnaraine as chairman. The committee is expected to present a feasibility report on the refinery within four months. CEPEP mowed down The shutdown of the Community-Based Environmental Protection and Enhancement Programme (CEPEP) at the end of June saw an estimated 10,500 people on the breadline, the opposite of the UNC/COI's campaign promise of providing up to 50,000 jobs for people. At the beginning of July, Public Utilities Minister Barry Padarath confirmed that more than 300 contractors who were collectively responsible for the workers were given a month's payment "in lieu of notice" to compensate workers for that month. The Prime Minister defended the decision to shut down CEPEP at a budget consultation in the Siparia constituency on July 29, expressing concerns of corruption and unsustainability with regard to CEPEP. She said the government is now considering how people from CEPEP could be put in programmes in which they could learn skills and transition to better employment. "Cepep cutting grass, URP cutting grass, reafforestation cutting grass when you supposed to be planting trees... We have become a nation of grass-cutters under the PNM," Persad Bissessar said. Dr Rampersad supported the decision, noting that the programme is undergoing a restructuring. "I wouldn't say they lost jobs. I would say they are recalibrating; they are restructuring," she said. "They want to give them more sustainable jobs, not just cutting grass." However, she noted the importance of finding ways to meet the promise of employment in a sustainable way. "They need to think through this very carefully – how is the government going to create sustainable jobs. You don't want to give people a 'ten days' here and there, and they do not have any skills. You would want these people to undergo training and acquire some skills. "We need to have more plumbers and electricians. There is a lot of skills training needed in the construction sector as well." Crime With regard to crime, the government’s most significant move was the implementation of a state of emergency (SoE) on July 18, amid intelligence of enhanced criminal activity at the behest of gang leaders operating from behind prison bars. The SoE does not involve the imposition of a curfew, but bail provisions have been suspended for suspects. Officers of the Defence Force now have the ability to operate under the same regulations as the police, and officers have the authority to enter and search public and private premises as necessary and arrest people suspected of having criminal activities. The SoE is the second one for TT within the first six months of the year. During the debate over the extension of the SoE at the first extraordinary sitting of the House of Representatives on July 28, Barataria/San Juan MP Saddam Hosein listed the results of the SoE. He said during the first leg of the SoE, police conducted 830 operations, targeted 319 priority offenders, searched 5,153 vehicles and premises and conducted 449 traffic operations. As a result, 349 people were arrested, nine revolvers, 19 pistols, five shotguns, three rifles and two air rifles, along with 543 rounds of ammunition. Still with murders averaging at around one per day since the UNC coalition took office, crime is still a significant strain on TT’s society and economy. "The government said they don’t want to tell the population the plan because it could also inform criminals," Rampersad said. "They may have to consider a curfew at some point if it continues like this. Because crime is continuing under the SoE. "Whatever it is, I hope it is going to work, because it (crime) continues. "Again, we don’t expect the government to resolve the crime situation, which has been going on since the 90s or 80s, in 100 days, but this is (a campaign promise) they won on as well. People would want to see some dissipation." She added that the government has to find a permanent solution to curbing the flow of illegal firearms in TT. "The fewer illegal guns in the country, the less crime," she said. She also noted her support of stand your ground legislation, which is also being debated in Parliament. The stand-your-ground legislation, another promise made in the campaign, seeks to make it easier for law-abiding citizens to access firearms for personal protection and safety. Great expectations Despite the challenges faced by the government in its effort to turn TT around, there is still a sense of optimism felt by some. Speaking on crime, Rampersad said security forces are trying to ramp up its efforts to fight crime and that is bringing some measure of comfort to the population. "The community might be a little more comfortable, but the fact remains that there are still kidnappings, murders and robberies," she said. "We still have a long way to go." Arjoon, with regard to energy, noted that recent wins with Exxon sets the right tone. "The fact that the minister has also indicated a commitment to overhauling the approval regime for energy projects through the streamlining of regulatory and environmental clearances and shorten project timelines could boost investor confidence and accelerate new production. "A simplified regulatory environment could also attract more global energy firms to invest locally, including smaller and medium-sized companies interested in marginal fields that larger corporations might find less economically attractive," he said. He added that measures expected in the upcoming budget, which has an emphasis on interventions designed to boost non-energy production and enhance export capacity, also shine a light of optimism on a country that has struggled for a number of years. "The narrative has also shifted significantly from past rhetoric that was austerity-focused, like 'tighten your belt' to finding practical solutions to our economic challenges, a critical step in rebuilding private-sector confidence and economic revitalisation." Howai also expressed optimism, coming from the initiatives in the energy and non-energy sectors, saying that it would seem the TT government is heading in the right direction. "As far as some of the initiatives it seems to be heading in the right direction. "We are very optimistic, we are hoping that some of these things will occur, but of course, things at Exxon, for example, are not going to give us immediate, short-term relief. "Nevertheless, there is room for optimism in what we are seeing.” In the meantime, Howai promised that the Central Bank will do everything it can to support the TT economy. "We will try at the Central Bank to maintain stability as far as forex is concerned," he said. "We will put money into the system to keep things going in the short term. That includes what we give to the banks and what we give to Eximbank to the manufacturers and to the state sector, which is critical, particularly for state utilities as well as for food and so on. We do make allocations for help in those areas. "We will take another look along with the banks, at what is the best strategy to streamline the approach toward the distribution of what we have and we will engage all the various business communities with respect to what they can expect and what our position is and what are some of the things we are trying to do to ensure that there is a more even distribution of forex supply out there."   The post First 100 days in office – A sliver of hope appeared first on Trinidad and Tobago Newsday.