UNC: Central Bank Gov. in denial

St Agustine MP Vasant Bharath says the Governor of the Central Bank has lost all credibility by grudgingly admitted that Trinidad and Tobago is "technically" in a recession.

The opposition shadow finance minister was responding to statements from Ewart Williams that although although there have been three successive quarters of negative growth the term "recession" is only a matter of semantics.

Bharath said during the budget debate all the evidence available pointed to the country being in a recession.

"We noted the drop in business confidence, the lowering of consumption demand as people had less money to spend, the closure of businesses, capital flight and the resultant job losses" Bharath said.

"The signs were clear, but the Central Bank Governor had parroted the words of the Prime Minister vehemently insisting that the country was not in a recession, but was in a ‘slowdown’," he said.

"We warned that while the Minister of Finance was telling the nation that the country would see positive growth of the economy of 2 per cent as a result of her Budget, there was actually nothing in that budget to inspire business confidence and therefore to stimulate economic activity," he said.

On Thursday Williams projected that the recession could last until the second quarter of next year.

He said, "Unfortunately like the minister of Finance the Governor can show no basis for this confidence. As he himself admits, the projections for the international recovery are that it would be sluggish and jobless."

Bharath said consumer and business confidence remains low in the United States yet the Governor "seems unfortunately to have pegged his hopes, as the Government has done on a revival of international energy prices to the peaks of early 2008."

He said Williams' "callous dismissal of the recession by his remark “what’s in a word? ” trivializes the increased severity of the economic hardships being faced by the citizens and the concerns of the small and medium sized business community for whom this recession is literally a life or death situation."

He charged that Williams seems to be working hand in glove with the Government of Trinidad and Tobago to downplay the severity of the economic decline currently confronting this country.

"Instead of being upfront with the population, as every other government in the world has done, and clearly charting out mature and responsible plans to confront the problem, to halt the hemorrhage, and thence to stimulate the economy whilst reducing the impact on vulnerable groups, the Government denies the existence of the problem," he said.

"The continued failure to diversify the domestic economy and the government’s continued fiscal irresponsibility funded as it is by borrowing on the international market, concealed in contracts to foreign companies, literally guarantees increasingly significant capital outflows in an uncertain future," Bharath added.

Bharath stated, "The falling business and consumer confidence is as a direct result of the failure of the Government and the Governor to confront the fact that the country is in a recession, and to reassure the population that it is being addressed with the seriousness it deserves."

He said until that is done, the future of this country "under this Government is bleak."