00:00According to Dr. Valmiki Arjun, between 2015 and 2024, the economy contracted by 16.4%,
00:08oil and gas production declined by 30%, and foreign reserves were down by 62%.
00:14The economist says it in essence forced the incoming UNC government towards policies to stabilize the economy.
00:22So after one year in office, Dr. Arjun believes that what has been done is a revenue adjustment.
00:28So their budgeted revenues rose from about 28.1% of GDP in fiscal 2025 to a budgeted 31.1
00:41% in 2026 of GDP,
00:45which could very well be a bit higher given the hike in oil and gas prices in the international market
00:53now.
00:53Dr. Arjun expects this to remain in play for at least now with what is taking place geopolitically.
01:00This, he states, could also see some replenishment in the Heritage and Stabilization Fund.
01:05While he states that overall expenditure moved up a percentage point or two,
01:10he notes what has taken place with capital expenditure.
01:13That has increased from about $3.6 billion in the last fiscal year to about $4.1 billion,
01:21or about 2.3% of GDP.
01:24That is where you get the more value in terms of the multiplier effect when they spend on infrastructural projects,
01:35specifically, because you're talking about the increased stimulation of construction activity,
01:43increased growth in the construction sector specifically,
01:48which would tend to create more value added, more productive jobs, etc.
01:53Dr. Arjun says measures like the asset levy on banks and insurance companies,
02:00excise tax on things like cigarettes and alcohol, are less than conventional,
02:05but prevent a decrease in the spending power in households,
02:09which he states increases in VAT and income tax would have redound too.
02:14While there has been criticism for the government over the landlord surcharge
02:19amid a scrapping of property tax, Dr. Arjun doesn't feel it's a case where the vulnerable will suffer.
02:25The market is so competitive, okay, well, you increase the rate of rent,
02:30well, what is to stop the tenant from just going and finding somewhere next door
02:34or two buildings down the road, which is still very convenient from them
02:39that is offering it to them at a lower level?
02:42He's looking toward a rollout of the Real Estate Investment Trust,
02:45which will allow investments by way of buying shares in state properties.
02:50As Dr. Arjun anticipates infrastructural development at the port
02:53as part of the government's revitalization plan,
02:56he's especially excited about a planned 18-month rollout of the Asikuda system
03:02being done in collaboration with the United Nations.
03:05Helping not just to reduce the overall costs of doing business,
03:09especially more so for manufacturers, the private sector, etc.
03:12But in addition to that, you would see a faster turnaround time of businesses
03:18in their operations because they're going to be able to declare their goods for resale
03:23or their raw materials or the inputs for production much, much faster.
03:27As for his verdict on the UNC's overall economic performance?
03:31A scale of 1 to 10, where would you place them for their first year?
03:37Right. So, so far, I think we could probably give them like an 8 out of 10.
03:43And coming from me, that's the eye mark really hard as.
03:47Alicia Boucher, TV6 News.
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