Published On: Fri, Jan 16th, 2015

T&T government says oil price drop has resulted in $TT7.5 billion loss

Oil Barrels with Red Arrow isolated on white background. 3D renderPORT-OF-SPAIN, Trinidad - The Trinidad and Tobago government has reiterated its position that the drop in oil prices on the global market is not a signal for a sudden change in its economic development policies.

“We have the capacity, we have the will and we have passion to secure our future and we will emerge stronger, together,” Prime Minister Kamla Persad Bissessar told business leaders at a meeting here on Thursday night.

Oil prices have dropped significantly from a high of US$104 a barrel in June to less than US$50 a barrel this week.

The government has said that the island has lost approximately $TT7.5 billion as a result of the oil price situation and last Thursday Prime Minister in an address to the nation outlined measures which she said her administration would take to lessen the impact on the local economy.

But it has already promised there would be no job cuts or cuts in social programmes.

A government statement issued after the talks said the prime minister held an “important conversation with the business community” and that “representatives endorsed the approach taken in dealing with the current environment, and expressed their commitment to working with the Government on projects and initiatives to further expand the economy.”

The statement quoted Prime Minister Persad Bissessar as assuring “business people that she would ensure that the present challenges are managed in a way that places people and country first, and also a strong focus on preserving the economic and social stability.

“She noted that the Government’s first approach includes review of our PSIP (Public Sector Investment Programme) and recurrent expenditure with the aim of identifying savings of approximately TT$4.5 billion (One TT dollar=US$0.16 cents).”

She said that further savings would be “derived from a lower oil price generating a lower demand on Government for the petroleum subsidy, adjusted possibly to TT$1.7 billion.

“With the best made plans, accelerating development, increased growth and stability, it is the people we depend on to make it happen.

“Sectors cannot expand, the economy cannot grow, the future cannot be secured unless the policies we implement and the vision we pursue place the people as the drivers of progress,” the statement quoted Prime Minister persad Bissessar as saying.

It said “business people endorsed the statements made by Prime Minister Persad Bissessar and welcomed the thrust to engage the private sector in Public-Private Partnerships” and that the business representatives had identified “two issues that are critical to their operations – shortage of labour and foreign exchange.”

The statement said that the Ministers of Finance and the Minister of Trade, Industry and Commerce were mandated to meet as a matter of urgency to develop a sustainable plan to manage foreign exchange supply.

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