May 2010 Financial News

Economist predicts flat growth for T&T economy

May 14, 2010

In predicting flat growth for the rest of 2010, economist Jwala Rambarran said that T&T has not learnt from its mistakes in the past regarding the economy.

“We seem to have forgotten the mistakes we have made in the past. The mistakes that we came through two significant energy booms and we went through a very harsh period of adjustment, and it seems we have not learnt anything from that in this current boom, which is actually on its tail end.” Rambarran was speaking to the Guardian on Tuesday after a presentation on the T&T economy, at the Arthur Lok Jack Graduate School of Business, Mt Hope.

“We continue to think ‘the party’ is continuing and there’s no need to stop for a while and do some sober reflection on the way forward.” He said the Central Bank has been doing its part in educating and informing the public about the economy, but citizens need to do their part by speaking out. “It is incumbent on us in society to say that we are not too happy with how we see things moving ahead,” Rambarran said.

Single-digit growth

“Growth is going to be a single digit. The general expectation is around two per cent growth for this year—that is quite possible arithmetically, but that is not going to translate into actual activity on the ground, so that’s why there would be flat growth,” Rambarran said. He said the general election would generate growth in the economy for the rest of 2010, but there was little activity in the first six months of 2010.

“Businesses are waiting for September to see whatever party comes into power, and the form of what that budget would look like, as well as the priorities and policies that would be enunciated there. He predicts if there is a “pick-up in activity” it would be in the last quarter of 2010.

Rambarran said $20 minimum wage would not make a difference in the economy. “Some persons are already above the limit of $10 to $15, so it is those who are under and what the discrepancy might be—the difference that needs to be made up. What is the size of the labour market that receives the minimum wage, in any case, to make such a substantial difference? I don’t think that size is that large,” Rambarran said.


Source:
NADALEEN SINGH
Trinidad Guardian
Friday May 14, 2010

http://guardian.co.tt/business/business/2010/05/14/economist-predicts-flat-growth-tt-economy