Mayaro MP Rushton Paray said while Finance Minister Colm Imbert may be optimistic about international ratings agency Standard and Poor’s (S&P) confirming a BBB- investment grade on TT with a stable outlook, the fact remains the rating is one step above junk.
Speaking at the UNC’s weekly media briefing on Sunday, Paray said Imbert twisted the truth by saying that this stable outlook is “an investment grade rating reflective of TT’s credit strength.”
“The truth is we are a speculative risk. The credit rating is not a statement on economic growth or management. It is a statement on the ability of a nation to repay its debt and we are just once notch above junk status.
“A stable outlook is not a reason for the minister to throw a party. He also pointed to this being the first positive rating move for TT in 15 years, but it was under this PNM government the ratings fell from an A rating in 2015, to A- and the slide continued thereafter.”
Paray said in April 2017, S&P lowered TT’s long term sovereign credit ratings from A- to BBB+, and in July 2019, it lowered TT’s long-term foreign and local currency sovereign credit ratings to BBB from BBB+.
He said in March 2020 S&P downgraded T&T’s long-term foreign and local currency sovereign credit ratings to ‘BBB-’ from ‘BBB’ one place above junk, and since late July 2021 S&P has held the rating at BBB- but with the outlook worsening from stable to negative.
Paray said, “Minister Imbert is once again distorting the truth preferring political propaganda to the truth. Let’s review what Imbert’s tweet did not say.
“We have a situation in which many indicators worsened…This is not real growth. In the same report it says real GDP growth was negative for 2021 at 0.2 per cent, confirming that the depression was pushed in its sixth year and it shows that savings as a percentage of GDP fell. It showed that real exports will continue to fall and, if so, where will we get foreign exchange, or would we continue to strangle demand?”
Paray said the report also showed the unemployment rate rising steadily from 2015.
“If one looks closely at the growth rate projections of GDP for 2024 and 2025, when the “opening back of the economy” benefits and higher energy prices benefits are expected to fall away, TT will re-collapse into being among the worst in the world. Which responsible and sensible Minister of Finance will be rejoicing based on that?”
Paray said according to a Central Bank survey, at least 50 per cent of people are worried about their financial wellbeing, more than 50 per cent are living pay-cheque to pay-cheque, and many people are not taking home any pay-cheque at all.
He said recently, non-partisan think tank the Commonwealth Foundation said over 20 per cent of TT’s citizens currently live on or below the poverty line, with 11 per cent of the population being undernourished.
“The food poverty line for TT is $8.22 per day. That means they cannot afford three square meals a day and to buy other essentials such as medicine.
“Let that sink in for a second – 20 per cent or around 300,000 citizens live on $8.22 per day. That is just enough to purchase one doubles and a soft drink. We do not need surveys to tell us what each and every one of us feels and sees on a daily basis, that the prices of basic food items are skyrocketing, that even menial jobs have become scarce, and salaries have been stagnant for years.”
Paray compared TT’s economy to that of Sri Lanka, where the economy has collapsed, and said one of the similarities between the two was that the Sri Lankan government promoted and emboldened persons completely unqualified to manage the country affairs. He noted that Imbert consistently refuses to take advice from anyone who seems to be critical of the government.
He asked what had changed in the last 12 months when Imbert said headline inflation was at one per cent due to government policy.
“Now one year later the Prime Minister is telling us the economy is in a critical state and that in order to deal with skyrocketing inflation the Minister of Finance will present a special presentation on inflation on September 2. When our inflationary rate was one per cent it was a symbol of another major problem, one of deflation, which meant that consumers were not spending and our economy was in stagnation.”