Friday, May 16, 2008

Which will impact your life? 1970s or 2008

PPP/C govt. response to global price rise effective, less draconian than PNC’s when oil price hit in 1970s – Min. PersaudGeorgetown, GINA, May 15, 2008

The PPP/C Government’s response to the soaring fuel price, which has increased by about 400% over the past three years and is driving up food prices in Guyana and across the globe, has been described as “more comprehensive, effective, sustainable and not punitive” when compared to the steps taken by the then PNC Government when the world and Guyana experienced a similar situation in 1974-75 period.

Speaking to Guyana Agricultural Workers Union (GAWU) field and factory representatives last evening at the La Bone Intention (LBI) Community Centre, Minister of Agriculture, Mr. Robert Persaud compared the steps taken by the PNC government of that day when fuel reached an all time high then and sent food and cost of living `sky high.’

The Minister referred to the 1975 Budget Speech of the then PNC Finance Minister, Frank Hope which stated: “By the end of January, 1974, the situation as it could be foreseen for the rest of this year revealed that our external reserves were certain to come under devastating pressures as the prices of imports – fuel, fertilizers, machinery - soared to unprecedented levels.

It was also clear that the rate of internal inflation would have been far beyond anything in this country has experienced before, and that the government’s budget itself would have inevitably required substantial modifications. In short, the Guyana economy – like those of the rest of the developing world with the exception of the oil exporting countries – was in a crisis.”

Minister Persaud recalled that the PNC government then started to institute “punitive and draconian measures which eventually led to a deterioration of people’s living conditions and the collapse of the Guyanese economy.” He substantiated this assertion of the PNC’s poor action by quoting again from the PNC Budget speech of 1975:

“Steps were taken to conserve foreign exchange, restrain consumption of non-essentials, and to tighten expenditure controls in the public service…Imports of non-essentials were restricted; practically all imports were put under a system of licensing; the availability of foreign exchange for vacation travel overseas and migrants’ transfer was temporarily suspended, and foreign companies operating in Guyana were requested to secure their working capital from external sources...”

Minister Persaud, who also chairs the Inter-Ministerial Committee on Food Prices, noted that President Bharrat Jagdeo and the Cabinet have done the opposite and adopted “a comprehensive, sensible, sustainable and non-harsh framework to address a similar situation confronting Guyana and the world, today.”

He said no controls or bans of imports of food, machinery and other necessary supplies were introduced. Instead of shrinking public sector spending, the Government has moved to increase the purchasing power of the ordinary Guyanese; especially those who work in the public sector through wages increase and a temporary cost of living adjustment payment.

Then the PNC Government had imposed a wage freeze. To cushion the fuel and food price rise, the Minister reminded that the Government has not increased fuel and water rates while the fuel and other bills of these companies have gone up by about 100% during the past year alone. Government had to inject billions of dollars into these companies to avoid them passing on the increased charges to consumers.The Minister referred to the wheat price which has gone up by 130% on the international market during the past year.

He said that when wheat prices went up under the PNC government the response then was to ban the importation and consumption of wheat and flour-based products in Guyana. But under the PPP/C government, Minister Persaud said that the President has instead provided $200M to minimize the rising cost of flour and stabilize the price of bread so that it is available and affordable to all Guyanese.

The Agriculture Minister said that it is not the intention of the PPP/C government to impose import bans and controls and anti-workers conditions, which can eventually lead to shortages, black-marketing, sufferings for the ordinary Guyanese and economic decline.

He noted that the Government has been alert and monitoring the situation closely and started interventions to cushion the global price rise since early 2007.

The Minister cautioned that remedies proposed must not lead to further hardships and there should not be any panic reaction to the situation which can lead to more sufferings in the long-run. Minister Persaud also called on sugar workers to join the Ministry of Agriculture’s “Grow More Food” campaign and made available to the GAWU Field Secretaries present a quantity of vegetable seeds for distribution to the workers.

Minister Persaud said that the Government is engaging all groups and sector of society to mobilise national support and collective response to his global phenomenon. He rebuked those who were trying to convert a global crisis into a partisan, political issue restricted to Guyana.

Workers at the meeting welcomed government’s intervention but urged that these be sustained and the situation managed, closely.

The meeting is part of an on-going engagement with field and factory representatives across the sugar industry to give workers a voice in improving the management of the industry and reduce the issues which lead to industrial relations conflicts.

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