Dr Marlene Attzs, economist and university lecturer, recently shared her expert insights on the recently presented 5-hour and 13-minute budget delivered by Finance Minister Colm Imbert, Monday, October 2.
Speaking on Altos, Dr Attzs offered a nuanced examination of the budget’s core themes and the economic realities facing Trinidad and Tobago, especially in light of the budget’s theme, Steadfast and Resolute – Forging Pathways to Prosperity.
Dr Attzs began by acknowledging the government’s focus on the macroeconomic indicators, noting that Trinidad and Tobago has seen some positive economic growth since 2019, the last “normal” year before the onset of the COVID-19 pandemic and the geopolitical upheavals like the Russia-Ukraine war.
She noted that the country has been benefitting from increased energy prices, particularly in 2022 and 2023, due to the surge in oil and gas prices triggered by the geopolitical conflict.
However, she emphasised that while growth is evident in terms of Gross Domestic Product (GDP), the impact of this prosperity on the average citizen has been minimal.
“I don’t quite think that prosperity, or what we see as good signs on the macroeconomic front, is actually trickling down to people just yet,” she remarked.
According to her, the delays in the global supply chain, combined with persistent inflation, mean that ordinary citizens are still grappling with rising costs of living. The situation is further compounded by looming increases in utility rates.
Minimum wage increase: a symbolic gesture
Dr Attzs was also asked about the government’s decision to raise the minimum wage by $2, a measure directed at public sector workers. While this increase has been welcomed by some, others argue that it is insufficient to make a meaningful difference in people’s lives.
Dr Attzs agreed that the increase was largely symbolic, representing what the government could afford at the moment. “It’s not something the average person would do a song and dance about,” she commented, while explaining that this move was intended to signal the government’s recognition of the economically vulnerable segments of the workforce, including CEPEP, URP, and MTS workers. Still, she cautioned that the modest increase should be seen within the context of the government’s constrained fiscal position, particularly given the significant burden posed by the public sector wage bill.
A balancing act: striking the right notes
Addressing broader budgetary concerns, Dr Attzs commented on the overarching strategy behind Minister Imbert’s budget presentation. She characterised the budget as one that “neither gave nor took away,” reflecting a balanced approach amid an election season.
Importantly, both Prime Minister Dr Keith Rowley and the Finance Minister have signalled that challenging times lie ahead, with 2027 being pegged as the turning point for a brighter economic future.
The government is betting heavily on the Dragon Gas project, a major initiative set to come online by 2027, though geopolitical uncertainties could influence its trajectory.
Dr Attzs underscored that much of T&T’s economic fate will depend on external factors, such as the outcome of the 2024 US elections and ongoing global tensions, including the Middle East conflict, which have already impacted global energy prices.
Health and National Security: a shift in priorities
One of the notable shifts in this year’s budget was the increased allocation for healthcare, which received the largest share, surpassing national security. Traditionally, many have argued that national security should command the largest portion of the budget, given T&T’s significant crime challenges. However, Dr Attzs pointed out that it’s not just about the size of the allocation, but rather the “return on investment.”
She emphasised that solving the crime situation requires more than simply pumping money into national security. It involves ensuring that the resources are effectively used and that the country is getting value for its investments in security measures. Similarly, the increased allocation for health reflects the government’s intention to tackle rising non-communicable diseases and improve the country’s healthcare infrastructure.
Dr Attzs also commented on the duration of the budget presentation, noting its strategic length. “Very strategic…he wore us down,” she quipped. The length of the presentation, she speculated, might also have been a move to set the stage for the opposition’s response, particularly for Opposition Leader Kamla Persad-Bissessar’s rebuttal, which is expected to match the length of the original presentation.
She anticipates that the opposition will criticise the budget for its lack of vision and transformational measures, labelling it a “holding brief” until more significant decisions can be made based on clearer geopolitical trends.
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