Credit Unions say Inputs of the Cooperative Sector Integral to a “New Start” of the Socio-Economy of Trinidad and Tobago

But new wine must be put into fresh wineskins.  (Luke 5:38)

Chaguanas, Trinidad – April 22, 2020:  President of the Central Finance Facility (CFF), Ms. Letitia Telesford, is calling on leaders within the Cooperative Sector to join in a conversation on the “New Socio-Economic Start” post COVID-19 for Trinidad and Tobago and to share the resulting recommendations with the Government appointed twenty-two-person committee charged with restarting the economy. The CFF as the Thought Leadership facilitator of the cooperative movement is willing and well placed to facilitate these discussions. Ms. Telesford is of the view that the credit union movement and the cooperative sector as a whole has a responsibility to be a very active spokesperson on behalf of its more than 500,000 members in Trinidad and Tobago, a membership which reflects ostensibly the middle to lower echelons of our society and one which has been voiceless in financial and economic discussions pertaining to Trinidad and Tobago’s current and future socioeconomic status. Our voice must be heard, even though we are not represented on the team set up by Government.

The CFF commends the Government’s initiative and is calling on leaders in the cooperative sector to start thinking and planning beyond the restart towards a new socioeconomic order that will insulate the ordinary people from future similar shocks.

According to Ms Telesford, a restart is indeed a necessary and urgent short-term socioeconomic action, but the medium- and long-term future will require a new start!

She postulates that COVID-19 has shown globally that most of the society is too vulnerable to sudden shocks and the traditional social safety nets have struggled to respond quickly and comprehensively. Individuals and businesses were operating on the edge of financial liquidity using month to month cash flow and short-term credit. Savings for emergencies were quickly depleted and many have toppled over the edge.

Telesford emphasized that “the T&T Government is trying hard and has done well” but many still suffer. This has resulted from the structural deficiencies created by non-reporting and ineffective monitoring of the small to medium sized business sectors, making it difficult to glean information readily so as to inform appropriate supportive action.  Too many had to risk life and limb to survive daily. The truth is ‘self-isolation’ and ‘stay at home’ assumes one has access to enough cash and does not rely on a ‘daily hustle’ to put bread on the table. That presumption is, however, only applicable to a privileged portion of any society.

The need for a ‘New Start’ is twofold. Firstly, the COVID-19 pandemic has exposed the structural economic weaknesses in the organisation of business and economic affairs on the national, regional and international levels. The brittleness of the old wineskin (current socioeconomic order) is clear and the fractures have already begun to erupt. That wineskin if retained will surely fracture when new wine is poured in.

A new wineskin (socioeconomic order) is required into the future to ensure some stability. The post COVID-19 economy will not be like the one that preceded it. It is incumbent therefore that the cooperative sector prepare to participate and shape this new economy. Integration into the international economy should not mean total dependence. Secondly, the COVID-19 response has laid bare the significant disparities between social-economic classes. Some could ‘work from home’ and so avoid contact, others had to be on the road daily and were at greater risk. The pandemic has clearly indicated in this scenario what functions are essential and it provides an opportunity for nations to review compensation scales, amongst other things, so as to ensure a just society. The lowest paid and least regarded were now the ‘essential’ people. Certainly, we need to reconsider how our nation values and compensates the different categories of economic actors. In this matter the cooperative sector must raise its voice and be heard.

She continued: “Under effective management, our health and security systems have held firm but we have seen some of the cracks in the system: such as our response time to place money or food in the hands of the vulnerable and the need for programs like unemployment insurance so that there will be always be funds available for shocks like these.  The state has had to relax monetary measures like the repo rate and cash reserves and then borrow back those funds, some two billion dollars at 3.3% to pay vat returns; despite our claim of having a vibrant manufacturing sector, yet companies have been slow to respond to produce basic protective gear as gloves and face masks at a time when our people so desperately needed them.  Free trade has left us vulnerable to disruptions in food and other critical imports including pharmaceuticals and PPE for health workers .The oil price shock has clearly identified the need for us as individuals to more effectively manage our use of scarce foreign exchange but it also points to some elements of paucity in our manufacturing industries. The industry’s recent discussions on manufacturing                 self-sufficiency are however noted.

We must rethink how we have used scarce foreign exchange earned from our nation’s patrimony of gas and oil on promoting consumerism lifestyles and give greater priority to promoting local production.  With reference to her prior statement on the importance of agriculture it is clear that a country can only be truly independent if it is reasonably able to feed itself in times of supply chain constraint. Agriculture must be a priority.

We have seen enough to know that a new economic order will emerge; and it is up to those of us who have been most affected and who remain vulnerable to ensure that we ‘take heed how we build’ so that we are better positioned to deal with these situations in the future.