Economist Dr Ronald Ramkissoon has urged Government to give careful thought to any cutbacks in expenditure."If you place too much emphasis on cutting back expenditure then you create problems for business," he warned when he address a breakfast meeting of the American Chamber of T&T on Friday.
"You've got to be discretionary, you've got to be judicious in terms of how you deal with expenditure. Given the deficits you have been running when you should have been running surpluses, for times like these we have no choice to cut back on expenditure. It is very important to be very strategic in choosing which expenditures to cut back, by how much and for how long."
Dr Ramkissoon said making cuts by itself can't work since revenue must be raised.
"We have been borrowing to fund transfers and subsidies to a large extent. We have been doing some wrong things and we need to put a stop to that," he said
Amcham TT president Ravi Suryadevara said there is still time to chart a way forward for the country despite the recession. He said the T&T economy is very stable and the country is faring better than its neighbours.
"It has to be a reality check for all stakeholders which is the necessary consensus the government needs to follow given the present circumstances as we configure the new economic reality," he said.
Suryadevara said T&T should be positioned attractively and regulated soundly to encourage investments.
"At the present time continuity in projects to bring much needed gas reserves on-line need to be in alignment with the recognition that there is a competitive landscape in attracting foreign direct investment, especially in the energy sector," he said.
He called for policies that would allow members of the business community to "weather the storm of declines in the economy."
"Future policy alignment, especially bearing in mind the present predicament we face is absolutely essential," he said.
Suryadevara, who criticised of the persistent deficits in the country since 2009, said that limited the response options of the Government. He said it is time for a reality check so that the public can understand the severity of the situation.
"Individual and institutional responsibility must be first exhibited to understand the severity of the situation. This is not a doom and gloom, this is simply what we do every day in the business community," he said, adding that T&T has become more resilient to shocks in comparison to its Latin American counterparts.
He wondered, however, how long the country could continue to be resilient to shocks since the cost of debt is rising. He said AmchamTT members have made suggestions to the government that "yield greater efficiency of public expenditure, such as increasing funding to the Financial Intelligence Unit ....increasing the resources allocated to the Auditor General."
Suryadevara called for the new public procurement regime to improve T&T's competitive position.