Tuesday February 9th, 2010
- Last update:14 hours 51 min ago
Central Bank Governor on recession: No cause for panic
Published: 12 Aug 2009
Central Bank Governor Ewart Williams, left, addresses issues relating to the T&T economy, Clico and Clico Investment Bank during a news conference yesterday, at the Central Bank, Independence Square, Port-of-Spain. At Williams’ left are Carl Hiralal, inspector of financial institutions, and Claude Musaib-Ali, managing director, Clico. PHOTO: KARLA RAMOO
Trinidad and Tobago faced a run on its reserves in the first half of the year as the Central Bank injected several hundred million of dollars to deal with the high demand for foreign currency, says Central Bank Governor Ewart Williams. Williams said statistics from the banking sector and the Central Statistical Office showed there was a dramatic slowdown in imports to nearly half its value in 2008, while the demand for foreign reserves climbed to more than US$1.1 billion for the first seven months of 2009.
But, Williams maintained that the country was not in crisis. He told the media and other special interest groups invited to a news conference on the economy at the Central Bank yesterday that non-energy imports for the first two months of the year declined by more than 50 per cent to US$911 million from US$1.55 billion last year. He said despite this, the Central Bank was prepared to defend the TT dollar, as ensuring its stability was important for future growth and confidence in the local economy.
“The Central Bank can confirm that we have more than ten months foreign reserve coverage and we are prepared to provide the support that was needed to ensure the business community has the confidence to invest,” Williams said. He said there may have been some run on the foreign reserves, but much of the increased demand for currency resulted from the reduced foreign currency earnings from the energy sector, as they faced lower volumes, margins and revenues. Normally, the commercial banks would buy currency from the energy sector, but with that source facing a slowdown, they turned to the Central Bank. He said the reduced import bill was directly related to the slowdown of the economy, insisting that T&T was not in a recession and certainly not in a crisis.
“Whether the current situation is a recession or a slowdown is less important than making sure that we adopt the right policies for our specific circumstances,” Williams said. “The US and other advanced economies may be able to spend their way out of recession because there is significant spare capacity, and an abundance of other productive factors which are waiting to be mobilised. “Most developing countries, including T&T, lack this luxury and need to be more aware of the implications of the demand stimulus, on inflation, foreign exchange, public debt and medium-term sustainability.”
Despite this, Williams said the country’s situation could not be defined as a recession, because the decline was not broad based across all sectors and must impact on incomes and employment that prompted further declines. “The situation in T&T is that we have mixed indicators; some are positive, such as lowering inflation, low unemployment and stable incomes,” he said. “Despite significant negative indicators, such as a decline in GDP, and economic activity is down, the country is not in a recession—at least it is too early to confirm. “The early indication was that both locally and abroad there are signs of a turnaround, thus we may not get three consecutive quarters of decline and chances are that we may realise a turnaround in the economy by the end of the year.”
..... WORSE TO COME Central
..... WORSE TO COME
Central Bank Governor paints gloomy picture of economy .....
Different newspaper headline from what the same Central Bank Governor say at the same news conference. Can't there be agreement on even the state of the economy?
Yes, read this article by
Yes, read this article by the same Central Bank governor on another Trinidad newspaper today and se who is fooling who.
http://www.trinidadexpress.com/index.pl/article_news?id=161516357
He said the reduced import
He said the reduced import bill was directly related to the slowdown of the economy, insisting that T&T was not in a recession and certainly not in a crisis......Quote.
But Mr Maharaj wants to see something else! watch Indian yuh have to try much MUCH HARDER to fool yuhself or somebody like me.
Now go and pen a fake letter to fake a "kidnapping"....
...why of course....what
...why of course....what panic?......heck, we cashed in our CLICO chips long before the game went bust....
Like you Zando Lee, I want
Like you Zando Lee, I want to know where he, Karen and the others invested it. I still waiting for my lil kakada from Clico only to hear that "We working on it"...
Who is really telling the
Who is really telling the truth, and who is fooling who?
Let me explain Trinidad and Tobago, people are no longer stupied and foolish when it comes to finances, the CL Financial debt will really be around 50 billion TT, which the Government must absord.
When this happens it will cause the S & P rating for Trinidad to drop. This will put additional pressure on the TT dollar, and cause a devaluation closer to $10 TT to $1 US . Import slowdown, but still a high demand for foreign currency, WHY? The Rich Syrians and other wealthy in this country, buying up all the USD they could get; and investing it outside of TNT, they smart and nobody could get vex with them for this, they preparing for the devaluation, so why don't the average man also prepare and stop pretending to be brain washed by these contradicting reports.
So it is really frightening to see the one guy I had great respect for, saying especially at a time like this that "There is no recession"
If you want to know where Trinidad is heading, just look at the USA, our dollar is directly pegged to the USD...GET REAL TNT.....
....Ewart, Carl and Claude
....Ewart, Carl and Claude all singing in unison at the same table...boy this inspires us with so much confidence that we want to run out there and buy up all the CLICO shares Karen wants to sell.....
Due in large part to
Due in large part to internal mismanagement and questionable regulatory supervision (or the lack thereof), the country's and possibly the region's largest financial institution / conglomerate has failed. If it is truly the belief of the Governor of the Central Bank that there is no reason to panic, after shareholders, policyholders and other investors have seen the value of their investments greatly devalued, then this position of the Governor demonstrates ignorance and irresponsibility. A more mature and respectable position would be to hold that while the financial situation is still grave or tenuous and while there is still need for concern, changes are taking place and we believe that the worst is over.
Socrates
Dear Ewart, you do not want
Dear Ewart, you do not want to say the words "CAPITAL FLIGHT", eh
Smithee
Some Fools can't seem to
Some Fools can't seem to READ and understand English,
“Whether the current situation is a recession or a slowdown is less important than making sure that we adopt the right policies for our specific circumstances,” Williams said. “The US and other advanced economies may be able to spend their way out of recession because there is significant spare capacity, and an abundance of other productive factors which are waiting to be mobilised. “Most developing countries, including T&T, lack this luxury and need to be more aware of the implications of the demand stimulus, on inflation, foreign exchange, public debt and medium-term sustainability.”.......Quote.
Despite this, Williams said the country’s situation could not be defined as a recession, because the decline was not broad based across all sectors and must impact on incomes and employment that prompted further declines. “The situation in T&T is that we have mixed indicators; some are positive, such as lowering inflation, low unemployment and stable incomes,” he said......Quote.
“The early indication was that both locally and abroad there are signs of a turnaround, thus we may not get three consecutive quarters of decline and chances are that we may realise a turnaround in the economy by the end of the year.”......Quote.
LEARN TO READ AND COMPREHEND WHAT YOUR'RE READING.
Increased demand on foreign
Increased demand on foreign reserves?
The increased demand had nothing to do with paying for vehicles for the Summit, (even if it is in two trenches or what ever 'sophisticated' package the bankers dreamt up), paying for the hire of two cruise ships or paying the scholorship fees for the students then?
O...............k............
La Diva
Criticizing easy but u want
Criticizing easy but u want that job?
Please don't ignore his IMF background! Just that nobody want that job. Anybody surprised that UK Bank Governor saying same.
The CB Governor cannot be political in his assessment of the economy or with any statement regarding the internal control measures, ask Ms Kumar. If only one knows how they were pushing for stricter control measures, but they don't make policy!
He is limited to forecasting & reports only what is on the table.
Who can't read between the lines blind.
Manning tell you to say
Manning tell you to say that, because he have to spend and thief more money, the only way to accomplish this is to buy some helicopters, more contract to Chinese, more business to hart, more money to spend in airport. And when the people say anything, he has his puppets to justify it, don’t worry everything ok, ok for Manning and Hart.
We interrupt this news story
We interrupt this news story for the following weather bulletin:
Tropical Depression Two, currently east of T-T Islands/ may well arrive as early as next Wednesday. For 3d animated isobaric rainfall projection for Trinidad-Tobago, visit:
http://www.hurricanebuoy.com/ana.html
I’m concerned that the
I’m concerned that the central bank does not appear to be confident in its ability to ride out the recession and perhaps is not adapting fast enough. I’m currently seeking an alternate Credit Card Merchant to make sure I’m covering myself in advance of any problems.