Economist Urges Caution On Refinery Restart Amid Global Instability
Economist, Professor Roger Hosein, has warned that Trinidad and Tobago should not allow temporary global instability and high energy prices to pressure the State into reopening the Pointe-a-Pierre refinery with public funds.
Speaking on Trinidad and Tobago Today, he cautioned that such a move could expose the country to significant financial risk.
Professor Hosein noted that current geopolitical tensions in the Middle East may create the illusion that refinery operations are suddenly attractive, but warned that these conditions are volatile and unsuited to long-term policy decisions.
He urged the government to be careful not to confuse short-term market conditions with a sustainable economic strategy.
« It may look glossier at this point in time with elevated oil price and the elevated price of refined petroleum products. But remember, this point in time may not last forever. So suppose this point in time were to last for nine months or for the rest of the year, and we were to hustle and reopen the refinery in some form by the end of the year. Let’s assume that for simplicity, and then conditions in the Middle East improve. »
Professor Hosein argued that the country’s current fiscal position leaves no room for the State to absorb losses tied to refinery operations.
He said that while he supports reopening the refinery, he is firmly opposed to any model that places financial responsibility on the government.
« I have no problem if we were to rent this refinery out for $1, as long as the money to get this refinery working does not come from the Government of Trinidad and Tobago. It has to come from other players. And if somebody were to come and rent the refinery for $1 and were to employ people from around the refinery and buy our crude oil in Trinidad and Tobago and other crude oil and refine it and increase value added in Trinidad and Tobago, that’s how we would benefit. But we have no money at this point in time, sometimes we struggle to pay wages, to pay workers. We don’t have money to be pelting behind a refinery that has been down for five or six years, we don’t. »
