Former government minister Conrad Enill says public expectation that diversification can, by the wave of a magic wand, solve T&T's economic woes, including the $20 billion shortfall in energy revenue, is not in keeping with reality.
In his assessment of the 2016-2017 budget, during Eastern Credit Union's Annual Post Budget Review at La Joya Complex, St Joseph, on Monday, Enill said the missing link in achieving diversification is discipline.
"You cannot be talking about diversification with your expenditure profile increasing at a rate faster than your energy sector contribution can maintain. For diversification to make sense in T&T, you need to have economic discipline," he said.
"You cannot be spending $10, $15 or $20 billion a year when energy prices are high and expect that when energy prices get low the other sectors within the society will fill it. It's a manager's business."
Enill said the energy sector has the greatest return for the dollar invested in T&T and tourism, manufacturing, financial services, agriculture, while contributing to the economy, do so at a smaller rate and at a smaller pace.
He said: "If you have to follow diversification, you have to have expenditure discipline."
Enill was part of a three-member panel that included political leader of the Movement for Social Justice (MSJ) David Abdulah and tax services expert at Price Waterhouse Coopers Allyson West, with Winsford James as the moderator.
West called on Government to ensure that diversification becomes a reality by creating the right atmosphere to facilitate it.
"I think we need more public-private sector involvement. The economy needs to be stimulated by the private sector. It cannot be stimulated by the public sector. We are too laid back. We wait on the government to tell us a direction, rather than be more responsive and proactive," she said.
Asked by James if Planning Minister Camille Robinson-Regis was doing enough to advance the country's diversification agenda, Abdulah said that would be made clear when Government's Vision 2030 Plan is published.
The MSJ leader said the issue of diversification, was one the state appointed Economic Advisory Board had been grappling with. He said it was impractical for citizens to walk away with the belief that this country's $20 billion loss in revenue and foreign exchange, brought on by depressed global energy prices, could be corrected by another sector over night.
"It's just too massive. I also believe there are some strategic things that we are going to have to do. When Cuba lost 70 per cent of its economy when the Soviet Union collapsed, it had to find a replacement and it said we are going with tourism," Abdulah said.
"They concentrated on that and they worked out every detail to get their tourism numbers up and they succeeded in doing so. We don't have that kind of strategic focus which says we are picking two or three sectors, go after those sectors and make sure that they succeed. If not three, at least, one of them will succeed."