Nov 2008 Financial News

Central Bank governor: T&T not in recession

Nov 18, 2008

The local economy will slow down significantly this year, but T&T is not in a recession, according to Central Bank governor, Ewart Williams.

And he said that because of falling commodity prices internationally, the local price of food will eventually fall and this would lead to a reduction in the local inflation rate currently at 14.8 per cent.

He made the statements yesterday while delivering the Central Bank’s monetary policy report for October, 2008. “We are not yet facing a recession. In fact our position is still the opposite,” Williams said.

He said the Central Bank and the Government had already begun discussing a contingency plan focusing on what to do in case the global recession was a long and deep one.He said the crisis plan must come out of discussions between the bank and the Government.

He said once this plan is complete, the Central Bank and the Government willl collaborate to decide on how to divide the tasks which have to be done.
“It’s serious work,” Williams said, adding that it involved an analysis of the various institutions in the country and making judgments about the extent to which they can withstand exhorbitant shocks.

Williams said the passage of the Financial Institutions Act in Parliament on Friday was part of the plan and work is being speeded up on the Insurance Act and the new credit union legislation.

In the monetary policy report released yesterday, the Central Bank stated, “If the global recession deepens, T&T is likely to face a serious challenge in the execution of its long-term strategic development plan. The early establishment of a contingency plan can go a long way in helping the country limit the negative effect of the crisis.”

The report said some Caribbean countries such as Barbados have already put such a plan in place.


Source:
Verne Burnett
Trinidad Guardian
Tuesday November 18, 2008
http://www.guardian.co.tt/news9.html