The following is the Opposition Leader’s statement:
As the world economy struggles to move beyond the impacts of COVID-19, we continue to face challenges not seen in generations. How is the current PNP Government navigating these challenges, if at all, and what is the level of success, if any, of their policies? What will happen to the Turks and Caicos Islands if the global economy falls into recession?
With headline inflation rates of nearly 10%, driven by supply shortages resulting from the war in Ukraine and ongoing COVID-19-related supply chain disruptions, most of the world’s major central banks have swiftly reversed course on the accommodative policy approach that saw them through the pandemic.
Inflation, interest rates, and the cost of living are at their all-time high in the Turks and Caicos, and many countries around the world, in particular the USA. These trends are powering the rise in global uncertainty and they are not going away anytime in the immediate future.
Hence it is more valuable than ever for the government to pay attention to global economics and politics. What actions are being taken to cushion these international shocks to mitigate greater pain for our people?
What contingency plans has this PNP government put in place?
Countries that have contingency plans in place can act faster and reduce the risks of mistakes. According to the Harvard Business Review website, which stated, that one doesn’t have to perfectly predict the specifics of the next shock to do this, and countries can model more generic scenarios, like a steep decline in consumer demand, the failure of a key supplier, or an increase in the cost of doing business in a specific country.
They also stated that making contingency plans is like paying for insurance: You hope to never have to use them, but if you do, they can be invaluable. With greater global volatility this is likely to happen more than ever, so the value of contingency plans has never been higher.
A recent release this month on the IMF (International Monetary Fund) website stated that “the outlook has darkened significantly since April 2022. The world may soon be teetering on the edge of a global recession, only two years after the last one.” It also stated that “multilateral cooperation will be key in many areas and that amid great challenge and strife, strengthening cooperation remains the best way to improve economic prospects and mitigate the risk of geoeconomics fragmentation.”
The world now sees that rising inflation is posing an additional challenge to an inclusive recovery as it disproportionally affects low-income households that spend a much larger share of their income on food items. Economic indicators are showing that the decline in real incomes is particularly pronounced in developing countries, where poverty is more prevalent, wage growth remains constrained, and fiscal support measures to alleviate the impact of higher oil and food prices on vulnerable groups are more limited.
We see here in the Turks and Caicos that surging food inflation is worsening food insecurity and pushing many below the poverty line as our main food source market, the USA, is still struggling with economic shocks from supply chain issues and other national and international issues.
These are days that demand wise restraint, proper strategic planning, and calm reasonableness. A PDM government, under my leadership, would make the right decisions to ensure that the pending global economic dangers would have as little as possible effect on the lives and livelihoods of our people. We would seek to transform the current world economic conditions into opportunities for all our people of the Turks and Caicos Islands.