Economists:
History will repeat itself
By
Driselle
Ramjohn
Trinidad
Express
Port
Spain
Petroleumworld.com
09 10 06
LEADING economists yesterday cautioned that oil
revenues will fall and if Government continues on
its current spending spree the boom and bust history
of the 1980's will repeat itself.
This from ace economists speaking
at an Employers' Consultative Association meeting
on "The Legacy of the Energy Dollar" at
the Hilton Trinidad yesterday.
Senior economist, Republic Bank
Dr. Ronald Ramkissoon said, "Certainly, we
need a greater saving effort, notwithstanding what
we are doing with the Revenue Stabilisation/ Heritage
Fund, we are not doing enough. Clearly, if we don't
spend as much as we do, then we have an option of
increased savings".
"I think we are behind (in
savings) and we have a very far distance to go because
we did not just start having oil and high oil and
gas prices ... We must remember that we have to
work harder to build the savings as we have nothing
to show for the 70's boom we had".
He added that the Government is
repeating mistakes of the past with regard to the
economy.
Caribbean Money Market Brokers (CMMB)
chief economist Jwala Rambarran said, "There
are a number of warning signs that we are seeing,
based on the last oil boom and based on what is
currently happening, that says we do have fiscal
mismanagement taking place".
He added that these signs include
high recurrent public expenditure, loss of competitiveness
in the non-energy sector and growing dependency
on oil and oil finance expenditures to support the
Government's programme.
The economist said that if Government
does not employ corrective measures such as an increase
in savings and a reduction of expenditure immediately,
the country is likely "to return to zero".
Dr. Dennis Pantin, head, Department
of Economics at the UWI said, "Buoyant oil
and gas prices create illusions. For example, if
you put up multi-storey structures or you build
overpasses or even monorails in some way that means
that your society is developed. That is a misconception".
"Buoyant
hydrocarbon production and prices does not contribute
towards sustainable development, but ironically
contributes to unsustainable development,"
Pantin added.
Trinidad Express
Thursday, September 7th 2006
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