Former Finance Minister Colm Imbert is weighing in on Trinidad and Tobago's latest credit rating from Standard & Poor's. Despite a shift in outlook, he says the country has managed to retain its investment grade status — thanks, in part, to decisions made under the former administration.
00:00Former Finance Minister Kham Imbit is taking pride in Trinidad and Tobago's investment grade rating being maintained by International Ratings Agency Standard & Poor's.
00:11The country's rating stands at BBB- and Imbit believes the groundwork was laid by the previous administration and that played a key role.
00:21The information given to Standard & Poor's would have been based on what the previous government had done and therefore I'm quite happy that the investment grade rating was maintained because that would have been based on the fiscal outturn, revenue, expenditure and other things that would have been done prior to the general election.
00:42Imbit says the outlook shifted from stable to negative for two key reasons.
00:47In the mid-year review, the new government decided to increase the budgeted expenditure for fiscal 2025 by $3.143 billion, thereby increasing the deficit to over $9 billion.
01:04Now, a deficit is the difference between your revenue and your expenditure.
01:11You have to borrow for the deficit.
01:13So, automatically, Standard & Poor's, they read these things.
01:17He also pointed to revenue challenges stemming from policy decisions taken by the incoming UNC government.
01:24The second reason is that we had worked on several new revenue-generating instruments.
01:34One would be the Trinidad and Tobago Revenue Authority, which is basically to deal with tax evasion because there are a lot of tax evasion outside there.
01:43So, the revenue authority was designed to deal with tax evasion.
01:46And the estimates of the amount of additional revenue that could be earned through the TTRA varied from $3 billion to $5 billion to as much as $10 billion.
01:57However, the scrapping of the Trinidad and Tobago Revenue Authority, along with the U.S. government's stance on the Dragon Gas deal, contributed to the downgrade in the outlook.
02:07Looking ahead, IMBIRD expects the 2025 fiscal package to be presented no later than October 6th.
02:15You need about 20 days to complete the exercise if you do it in the usual way, okay?
02:25If you do it in a normal way where you start at 10 in the morning, you go till 8 o'clock in the night, you don't have sittings on Saturdays and Sundays.
02:34You need about 20 days.
02:36But this, this political party has a habit.
02:41I remember in 2010 that they ran the budget 24 hours.
02:48He explained that the timeline is largely shaped by parliamentary procedure.
02:53With the new standing orders, you have to give the leader of the opposition three clear days.
03:00So I always had the budget on a Monday.
03:03So the three clear days would have been Tuesday, Wednesday, Thursday.
03:06And then the leader of the opposition begins on the Friday.
03:09And then you have to go for four or five days.
03:12And then you have five days of standing finance committee.
03:15The Senate, I believe, is just three days.
03:16Am I correct?
03:17So that if you, if you do it normally, maybe about 20 days, and then the budget division of the Ministry of Finance has to prepare the documents to go to the president for the president to assent to.
03:30Ultimately, the first appropriation bill to be presented by new finance minister, Devindranath Tanku, must receive presidential assent by the end of October.
03:41The government cannot spend any money beyond the 31st of October, according to the law.
03:47They have that period, the month of October, to spend.
03:51They are allowed to spend 10% of what was spent in the previous year during the month of October.
03:57From the time 1st of November reaches, if the budget is not assented to by the president, then the government can't spend any money.
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