Economist Dr Roger Hosein is urging citizens to temper their expectations as the Government prepares to seek an additional $2.8 billion in the upcoming mid-year budget review to address wage negotiations and outstanding salary payments.
Speaking on CNC3’s The Morning Brew programme yesterday, Hosein said the country must recognise that current economic realities differ significantly from periods of stronger energy sector performance.
“What I would say to people is that you cannot expect the same standard of living at 2,500 MMCF per day of gas as compared to 2010 when it was 4,300,” he said.
“But next year and in the few years to come, more resources will be coming on board. Temper your expectations.”
Hosein said he believes people understand the country’s economic challenges despite growing concerns over unpaid salary increases and the possibility of industrial action.
“I think good sense would prevail. I think people are very well aware of the poor state of the economy. I mean, it has taken a real battering,” he said.
He added that while workers are demanding payments owed to them, the Government and citizens would need to work together to navigate the difficult economic period.
“And, therefore, although people are clamouring for their money, they would understand that the economy is in a terrible state so that it would have to be ‘mano a mano’ (hand in hand), the Government working and the people working together to try to move in the next year and ensure that by the end of 2028, so that more income comes in, the Government is better resourced and, therefore, better able to pay,” Hosein said.
Addressing the Government’s planned request for an additional $2.8 billion, Hosein suggested the administration may be anticipating increased revenue from the energy sector, partly driven by higher energy prices linked to geopolitical tensions in the Middle East.
“Well, I suspect they are expecting a bonus on the energy sector... given that the war with Israel, USA and Iran would have given the energy prices some upward mobility,” he said.
He added that the Government may be planning to use any additional energy revenues to fund previously promised expenditure commitments.
Hosein also pointed to indications that job creation initiatives could form part of the Government’s plans.
“One of the things I noticed was listed in the headline of the announcement is that more jobs will be coming,” he said.
However, he cautioned against actions that could further weaken the economy as it attempts to recover.
“Be wise in your expectations rather than try to shut down the economy and kill the dying beast. Let the beast in the energy sector revive. Let the economy revive some more so that your needs could be met. The Government would be able to meet them in a more capable way and a rising tide would lift all boats,” he said.
