00:00You all have the best business in the world. You guys own 30% of every one of our businesses.
00:09You make 30% of what we make without doing anything, without investing anything, and you're all competent people.
00:21It was the private sector versus the finance minister today at the TTMA's leadership discussion and networking event at the
00:30Hyatt, as business leaders called out the government for its management of the economy. Planning Minister Kennedy Swart Singh had
00:38earlier attempted to paint a picture of the harsh realities facing the government.
00:4295 cents of every dollar. It goes in 94 cents for transfers, subsidies, pensions, salaries, debt repayment. Of every dollar.
00:56And of that 94 cents, about 46 cents are transfers and subsidies to state and enterprises. There are significant inefficiencies
01:05in our system. Not just on the revenue collection side, but also on the expenditure side.
01:10However, the Blue Waters executive chairman did not find the explanation satisfactory.
01:16The situation you are in is a normal, private sector situation. Some people don't even make 6% of sales
01:22after tax to grow their business. So, I'm not saying you don't have a hard hand, but it is not
01:28unusual compared to what we deal with.
01:31Business leaders also called out the government on the issue of outstanding VAT refunds, which has now passed the $800
01:39million mark.
01:41The VAT refunds. So, we've, I mean, I have to be honest, many manufacturers I've spoken to over the last
01:48few weeks. We've pretty much not received anything in over a year. So, we really want some clear timelines.
01:55But a clear timeline was not forthcoming, as the finance minister identified a number of issues with the process.
02:04More of that will come as we fix the BIR. That has been a major bid, believe it or not.
02:10And when you have the revenue stream of the country being compromised by lack of resources, etc., you have the
02:17problem is then it's a two-fold.
02:20Revenues are not coming in. Audits are not being done. And therefore, repayments cannot be done.
02:26So, we are looking at fixing the revenue side. We are looking at fixing the repayment side. And we are
02:31also looking at whether or not VAT, as it exists now, is the best fit for what we need to
02:37do going forward.
02:38The minister says an international consultant is reviewing the issue to determine whether sales tax or another mechanism may be
02:46more viable.
02:47Meantime, Central Bank Governor Larry Hawaii gave an account of the country's forex situation.
02:53If I compare 2025 with, say, 10 years before, our foreign exchange inflows from the energy sector is about close
03:04to 1 billion U.S. dollars less per annum than it used to be 10 years ago.
03:12We are in the process of trying to bring that back up, but it's going to take time.
03:16March last year, our foreign exchange reserves were about 5.4 billion. Today, it's 5.5 billion. It's not much
03:24more than it was then, but this is after we've put in the central bank itself 1.2 billion over
03:30the past year to help stabilize the economy.
03:33The central bank governor estimates that a number of TNT's energy deals will come into fruition in 2028, thereby boosting
03:42forex inflows.
03:43However, he notes the vast majority goes directly to the commercial banks.
03:49Many people think the central bank actually is the one that puts the foreign exchange into the system.
03:55We don't. It comes from the energy and the non-energy sectors, the people who actually have foreign exchange, they
04:02earn foreign exchange and they sell it directly to the commercial banks and bypass the central bank.
04:07So that 80 percent of it actually comes outside of the central bank into the system.
04:14And that is something that we need to remember.
04:18Renasa Cutting, TV6 News.
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