February 3, 2004
Mr Lincoln Lewis, the Secretary of the Trades Union Congress, in a letter to this newspaper published on January 21, 2004, accused the government of "pursuing an economic policy that gives the perception that its focus is economic genocide of the African community." This is strong language by any standards. Can the government be found guilty of this charge?
In 1988 former President Desmond Hoyte made an agreement with the International Monetary Fund for the implementation of an Economic Recovery Programme in an effort to address the economic crisis that then existed. The conditions of this programme included the privatisation of loss making state owned industries, restructuring and downsizing in the public sector and the removal of consumer subsidies and price controls. As more than one commentator pointed out at the time, that programme would quite clearly have impacted more severely on the urban working class, which was primarily African. A Social Impact Amelioration Programme (SIMAP) was introduced in an effort to provide transitional support for the most vulnerable groups affected by the reform process.
The bauxite industry was in a state of distress, partly due to low prices, and the Hoyte government had been trying in vain to privatise it. Under that government, employment in the industry was substantially reduced, as it was in the army and in other areas. Much of what happened then and since was the result of the implementation of the conditions introduced by the Enhanced Structural Adjustment Facility in 1990.
The present government can be accused of failure to push the programme of encouraging new private investment initiated by Mr Hoyte as vigorously as it should have done. It can also plausibly be accused of ineptitude in economic matters. But the country is still in some ways paying the price for the collapse of the economy in the Burnham years which Mr Lewis lived through and of which he is well aware. As he quite correctly noted in the same letter, he had protested and agitated in those days for better conditions. Real wages had fallen dramatically in those very difficult years when production in bauxite, sugar and rice had all fallen. In addition, the business class had been miniaturised, which also did not help with employment. The PPP government inherited in 1992 what the distinguished labour consultant, Mr Leslie Melville, has described as a substantial public sector wage deficit. There has since been some increase in real wages but public sector wages are still unacceptably low.
What this government has not done is to devise adequate strategies for economic recovery. It is true that it has faced relentless opposition but its performance has been lethargic and uninspired. It has failed to find a joint venture partner to help in the recovery of the bauxite industry and has had to continue to subsidise that industry heavily to keep it alive. It is attempting to make the sugar industry more competitive with a view to its long term survival. But there are severe economic problems of stagnation and unemployment.
Mr Lewis has every right to criticise the government's performance but his charge seems to ignore the conditions they inherited and the context in which they have had to operate and to be excessive and unfortunately phrased.