Source: Mid-year Report 2009
As usual the report does not bother to deal with several key issues relevant to the economy and the only mention the Clico fiasco warrants is a boast that “the government’s timely intervention in placing the company under judicial management has helped to contain the impact of the company’s difficulties.” It does not appear to have been recognised or accepted that had the government’s intervention been before and not after the virtual collapse of the company’s Trinidad parent, then the country would not have lost a gross sum of tens of millions of US dollars. The report offers no assurance of when Clico’s depositors and policy-holders will receive the money guaranteed by the ever-promising President. Those include the National Insurance Scheme and thousands of others who did not benefit from the serendipitous payout by Clico just prior to its downfall. Nor does it address the new arrangements for the insurance sector that has now been placed under the Bank of Guyana, the very institution that along with the Office of the Commissioner of Insurance contributed in no small measure to the demise of Clico. It is timely to note as well that the hurriedly drafted amendment is likely to create more juridical problems than the administrative weaknesses it is intended to cure. The entire functions of the Commissioner of Insurance have been transferred to the Bank of Guyana and unless the bank creates a similarly named position it is a fair inference that the position has been abolished.
It would have been good too if the Minister had spent some time telling the country about the state of tax reform which has become another annual promise, the progress to stem money-laundering, the state of the National Insurance Scheme given its exposure to Clico, legislation dealing with the New Building Society that according to the President has reached its lending limit, the (President’s) $2 billion promise to the housing sector for the vulnerable groups in our society and his billion dollar mangrove project and Dr Singh’s understanding of the reasons for the sharp decline in the performance of the distribution sector, from 11% in both halves of 2008 to a mere 3% in half-year 2009. Or is it that the Minister considers this and the reported Bureau of Statistics’ “estimate” of inflation in half year 2009 of 1.3% adequately dealt with by his assessment of consumers’ exercise of “caution and prudence”? I have to confess that is a novel if not unique explanation for depressed spending power in the national economy.
To be continued
