Friday, October 21, 2011


The just concluded budget debate was as uninspiring as the erstwhile Finance Minister's budget presentation. It is almost as if every single Parliamentarian was absolutely determined not to outshine the Minister when it came to his ideas on the management of the economy. Everybody payed lip service to the old idea that "we have to stop depending on our oil and gas" (and I have put the phrase in inverted commas on purpose), but nobody came up with any new ideas as to how we should achieve this obviously desirable goal. Nobody stood up and articulated a vision as to how we should or could achieve this highly desirable goal. Because let's face it, the oil and gas will run out one of these days! And then what?!

Looking at the relationship between Government and the private sector in this country since dinosaurs roamed the earth (or at least since independence) it is difficult to come to any other conclusion but that the private sector has failed miserably and/or been unable to meet the great challenge of being able to pay its own way as far as exports are concerned. In other words, if it weren't for the oil and gas revenues we would not be anywhere near the level of development that we now enjoy. So, the big question is why? Why hasn't the private sector 'stepped up to the plate and performed as it should have? They have had almost fifty years to do this! So? Why haven't they?

A friend of mine has suggested to me that one of the reasons for this is quite simple: all elected governments tend to become elected dictatorships for their term in office. In good old T&T the business class has tended to "suck up" to the Administration of the day and behave as supplicants rather than as partners. The result to date has been that the elected politicians tend to preen their feathers and enjoy their temporary and apparent superiority without bothering to realise that this attitude has stymied economic growth for the last fifty years! It is more fun to deal with a supplicant rather than with a partner. Having to deal with a partner would mean that you have to listen to his views ... which can occasionally be inconvenient. But if the rules mean that any time you want to get something that you have to come to me for permission then my ego is inflated and there is a good chance that I can get my pocket fattened as well. So, it ain't really in my interest ("me" being a politician of any political party who is either in office at the moment or who has hopes of one day being in office) to fix the problem or change the rules in any meaningful way that would allow you to make decisions without having to beg or ask me for a favour.

Let me put it another way: there are a host of things that require governmental approval or licences. At any given time on any given subject, the businessman has to jump through hoops to get his approval. There is no such thing as a fast track for anything, ranging from the simple application for a passport to the obtaining of an energy licence to do exploration. Work permits continue to be difficult to obtain, even when the foreigner invests substantial sums in the country. The prevailing attitude from those in charge of the State apparatus is that they are doing us a favour ... and not the other way around ... by giving us a licence or permission for whatever!

If you compare Trinidad and Tobago with Singapore you will get an idea of where I am coming from. In Singapore the Government treats with the private sector as partners, not as supplicants. Decisions on all matters are quick and informed. The Government there does not try to supplant or dominate the business community.The result has been that a small country with no apparent physical resources has boomed in the last fifty years. Things work there ... and work well! A lot has to do with attitude, especially the attitude of the politicians and the civil servants.

We have to start realising that it is not sinful to make money and to start creating an environment that is truly "business friendly". This is not to say that the business community is without sin. Don't let me get started on that! Maybe the sins of the business community can be the subject of another post, but let's deal with one thing at a time.

"New politics" (that grossly over used and over abused phrase) ought to be revisited again ... and this time it ought to mean something. It ought to mean creating a new and efficient business environment. It ought to mean that we are finally growing up and realise that our favourite colour should be the colour of our hundred dollar bills ... blue!

1 comment:

  1. All of this is true Mr. Montano. My comment is that this is ironic coming from a past member of the PNM that created this mentality and for 30+ years enforced it and punished any businessman who dared try to think of themselves as a partner. The PNM inherited many anti-business rules from the colonial powers, but never updated them or made any attempt to make life easier for business, unless there was something in it for them. Just the opposite in fact. Most of us old enough to remember can probably quote 100 hostile comments or actions taken to limit the private sector. They also managed to brainwash two generations of Trinbagonians to be hostile to business and now we are still "reaping the rewards."

    Another major factor is the local banking sector. They have been way too conservative and monopolistic in their lending practices to allow a blossoming of the private sector. To get start-up money from a TT bank has been well nigh impossible, unless you really don't need to borrow it. Make the banking sector more innovative, competitive and risk-taking (but not excessively) and you will see the benefits.

    So in summary:
    1) Politicians have to let go power
    2) Banks need to take more risk and be encouraged to finance start-ups.

    Peter E
    (formerly of Pt.Cumana)