Tuesday, January 12, 2016


Unfortunately, nobody seems to have zeroed in on the real problem that Trinidad & Tobago is facing with its finances. Oh! There is a lot of talk, but nobody is explaining to the ordinary person just how deep we are in the mess. Last night I had a conversation with a leading economist who put the problem in perspective for me. He said that he had reviewed the budget over the Christmas holidays ... not the speech, that's not the budget, but the real budget ... the figures. He said that when he looked at the projected income figures from the energy sector for 2014 they showed an income of approximately $16 billion. The figures projected by the Government for the 2016 budget (he said) show a projected income of $3.5 billion based on oil at $45 per barrel. he expected that with oil prices continuing their downward trend, the real income will be something closer to $2 billion!

Got that? Well it gets worse. In 2014 (he said) VAT earnings were approximately $5.7 billion. He went on to say that for most of the previous years before 2014 VAT earnings were more or less at this figure. But for 2016 the figure jumps to something like $12.1 billion. How? Where is this extra projected VAT income going to come from? The short answer is that it ain't comin' any time soon!

So? What is the Government likely to do? Well, my expert continued, if you look at Canada and Australia, which are both resource based economies like ours, they have had to devalue their currencies by approximately 25 percent. In other words, we can expect the same ... which will take us to around $8.00/$8.50 to the US dollar. The Government can then make up part of its shortfall this way.

Also, he said, the Government will probably stop paying VAT refunds. This way the debt (the refunds) will be an effective loan that won't show up in the books as a loan! It will soak up the excess liquidity in the system and private businesses and persons who were counting on that money suddenly won't have it any more.

To add more misery there is the issue of Petrotrin. If you thought that Caroni Limited was a drain oon the exchequer Petrotrin makes it look like a walk in the park. Petrotrin currently employs some 5,000 workers. The average monthly salary at Petrotrin is $23,000. In other words, Petrotrin's average monthly wage bill is $11,500,000.00!!!

You don't have to be a genius to figure that one out! So question: if shutting down Caroni was the right thing to do would it be also the right thing to do to shut down or scale back Petrotrin significantly? If not, why not? If so, when will this be done?

Put another way: we are in trouble ... deep trouble!!

Sunday, January 3, 2016

WE AREN'T SERIOUS ABOUT TOURISM (and probably never will be)

How would you like to go to what was represented to you as a first class hotel and find that it's beach was as filthy as is shown in the above picture? You wouldn't? What a surprise! But take a look at the next picture of the same beach:

Yep! It's really dirty isn't it. But you are paying at least US$250 per night (or more for the privilege of staying in the hotel. (And yes, those deck chairs that you saw in the above picture are for the hotel's guests to sit and savour the wonderful view of the filthy beach).

And where is this 'nirvana'? Take a look at the last photograph below. Recognize the place? That's right! It's none other than the Magdalena Grand ... one of Tobago's premier hotels proudly owned and operated by the Government of Trinidad & Tobago!
All three pictures were taken on New Year's Day this year by a foreign visitor to Tobago.  She was a guest at the hotel and was distressed at the filth that was on the beach. She told me that the cost of her holiday was certainly not cheap. She said that complaints to the manager of the Magdalena as well as to the staff of the hotel were met with shrugs and the statement that they could do nothing about it. Really? The manager could not even complain to Chief Secretary Orville London? Maybe he had tried before and Mr. London had told him to shove it. Maybe he hadn't complained at all. But how could Messrs. London & Co. (otherwise known as the Tobago House of Assembly or THA) not know about  the filthy state of this beach outside of one of Tobago's top hotels. Do they care?

Just the other day the new Tourism Minister made a visit to Tobago and was reported to have gone to the Magdalena Grand. This beach didn't get dirty overnight. Didn't he see it? If so, what did he do about it?

I asked my friend if she would come back to Tobago again. She smiled and shook her head. "I don't think so," she smiled.  And that said it all! Either we wake up and smell the coffee or we don't. But don't tell me that we are serious about developing tourism as a possible source of foreign exchange when we so clearly don't give a damn about the tourists or providing them with a clean and safe environment.