T&T has been ranked among the ten economies likely to shrink this year by the Economist. A report by the magazine’s Economist Intelligence Unit places this country 9th on the list, just above Greece in a ranking that also includes Venezuela, Brazil, Syria, Libya, Equatorial Guinea and Burundi.

Reacting to the news yesterday, two economists told the T&T Guardian they were not surprised at the ranking. Indera Sagewan-Alli, executive director of the Caribbean Centre For Competitiveness said while she could not agree or disagree with the magazine’s assessment, she is not surprised at the country’s rate of decline in terms of gross domestic product (GDP).

“It follows from the structure of our economy, from our heavy dependence on oil and gas and what has happened with respect to the fall in the price of oil and gas and production levels,” she said. “The economy is in a period of significant decline.”

Dr Roger Hosein, senior lecturer in the Deparment of Economics at the University of the West Indies, St Augustine, estimated the contraction of the T&T economy to be “in the vicinity of 1.5 per cent.”

He added: “This decline is on account of the downturn in energy commodities, so that the sharp decline in energy prices has led to a sharp decline in their activity.”

Hosein said there is need for tripartite discussions among all the stakeholders in the economy to combat the current problems.

“In this type of economic environment what is required is a multipartite arrangement, as in the Prime Minister’s statement to the nation. The idea of the private sector, labour market and labour unions working together is a welcome one as all hands will be required on deck in this new normal.”

In its economic forecast for 2016, the Economist said T&T’s economy will contract by almost two per cent.

“The picture is particularly gloomy for commodity-exporting nations such as Venezuela, which is in deep economic recession. The outlook for Brazil is far from positive too, where falling oil prices combined with the implications of the Petrobras scandal will affect investment in oil and gas.

“War-torn countries also feature in the projected worst performers of 2016. Libya’s GDP has been contracting since 2013; continued conflict and political uncertainty means that it will continue to shrink this year.”

Global GDP is forecast to grow by 2.7 per cent. The magazine said this moderate outlook reflects the fact that growth is still lacklustre in the Euro area, Japan and emerging market economies.

The magazine’s forecast comes approximately one month after the announcement by former Central Bank Governor Jwala Rambarran that the country is officially in a recession after four consecutive quarters of economic decline.

In an address to the nation last Tuesday, Prime Minister Dr Keith Rowley announced a series of measures aimed at stabilising the economy. These include a seven percent cut in the operational expenses at all ministries and the Tobago House of Assembly (THA), reintroduction of land and building taxes. a revised regime of value added tax (VAT) and tripartite discussions.