By Peter Richards
PORT OF SPAIN, Trinidad, May 7, CMC -Prime Minister Kamla Persad Bissessar Thursday night signalled that her government has inherited a struggling economy and that the country has been running month to month, “literally living on the overdraft at the Central Bank”.
Speaking at the first post-cabinet news conference of her administration following the April 28 general elections, Prime Minister Persad Bissessar said that the general election coincided with the mid-year review, and as a result, “we must assess the state of the economy as a priority”.
Prime Minister Kamla Persad Bissessar, speaking at her first post-Cabinet news conference on Thursday night after chairing the first Cabinet meeting of her new administration (CMC Photo)
She told reporters that after this assessment and review, “we can move forward with many policies.”
She said the Finance Minister, Davendranath Tancoo, met with officials of his ministry and the most important consideration was the state of the country’s cash flow month to month.
“The cash flow statement gives an estimated update of the government’s immediate status by month, which is informed by multiple divisions of the Ministry of Finance,” she said, noting that in April 2025, total cash inflow was estimated at TT$3.95 billion (One TT dollar=US$0.16 cents), and total cash outflow was estimated at TT$5.28 billion.
“This left a cash deficit of TT$1.33 billion, which was met from the Central Bank’s available overdraft cash balance,” Prime Minister Persad Bissessar said, noting that by the end of April, the available overdraft cash balance was TT$3.67 billion, of which TT$2.74 billion was carried forward to May 2025.
“”It should be noted, however, that there was an outstanding balance of unpaid cheques in the system valued at TT$500 million, which was also carried forward to May 2025.”
Prime Minister Persad Bissessar said that cash inflows for May 2025 from the various sources of government revenue are estimated at TT$2.38 billion.
“However, it is estimated that the cash outflow will be around TT$6.3 billion, resulting in a cash deficit position of TT$3.92 billion. Worse, if all the unpaid cheques in the system were presented for payment, this would add a further TT$500 million to the deficit for the month, a total deficit then of TT$4.42 billion for which the Ministry of Finance will need to find funding.
“This is a delicate situation because it means that the country was being run month to month, literally living on the overdraft at the Central Bank, which we will now have to max out to meet only part of the deficit in May,” said Persad Bissessar, flanked by members of her cabinet.
She said the T$4.42 billion deficit can be funded by various means, including drawing down the remaining TT$2.7 billion of the available overdraft at the Central Bank, refinancing a minimum of 60 per cent of the Treasury Bills due in May.
“This will free up TT$647.7 million to address part of the deficit. While it is estimated that 60 per cent will be used, it is more practical to refinance the entirety of the TT$1.1 billion in Treasury Bills to leave some breathing space with the balance in the Overdraft,” she said, adding that Heritage and Stabilization Fund ( HSF) available balance to be drawn down for the rest of the fiscal year 2025 of TT$1.76 billion.
Prime Minister Persad Bissessar said she has raised questions about June’s cash flow and the expected deficit for fiscal 2025, adding “from what I am being told, the expected deficit for 2025 will be around TT$11 billion” and that the Minister of Finance will provide more details in the coming days.
According to the prime minister, the most recent tax collection data for fiscal 2025 is up to March 2025, and the data shows that from October 2025 to March 2025, total fiscal collections were TT$17.563 billion.
She said that the permanent secretary in the Ministry of Finance has been asked to provide a revised projection of revenues in the short and medium term.
“Given the high levels of deficit and debt, this is likely to adversely affect the ratings from the credit rating agencies,” Persad Bissessar said.
She told reporters that she has instructed the Minister of Homeland Security, Roger Alexander, to provide a list of all persons benefiting from state-funded security, both police and private.
“We plan to redirect most of these resources towards the fight against crime, so many of these unnecessary security details will be cut.
“I have also requested a listing of government officials being supplied with state-funded housing to see where we can cut some costs. I have directed to stop all requests for state funded housing for my cabinet members. The country is not that big; they can drive to work from their homes.”
In addition, Persad Bissessar said that she has also directed that an assessment be done to cap the maximum price on vehicles that parliamentarians can purchase using their tax breaks.
She told reporters that the Minister of Energy and Energy Industries, Dr. Roodal Moonilal, had convened a meeting with the various stakeholders in sector on Thursday outlining “our policy position to engage with the authorities of Guyana and Suriname” to fast track several projects, including the proposal for the establishment of a Solar PV Power Plant in Suriname.
She said another proposal would be the technical and economic feasibility assessment of a cross-border subsea pipeline from Trinidad to Suriname as an option for monetising gas from Suriname and Guyana by the National Gas Company.
Persad Bissessar told reporters that Moonilal is expected to attend the Suriname Energy Oil and Gas Summit to be held in June and that he will maximize this opportunity to engage in high-level discussions with key entities from the region to support energy initiatives and ensure economic benefit to Trinidad and Tobago.
“Our efforts are focused on actively promoting economic cooperation in the energy sector within the region by establishing agreements which will serve as a binding force to unite our countries.”
Persad Bissessar said these efforts will result in mutual value creation and sustainability through energy endeavors in partnership with these countries.
“However, value creation is an ongoing process that needs to be nurtured through the fostering of bilateral relationships. In this regard, we are also actively pursuing the Grenada Gas Initiative to ensure that the resources within the region are optimally developed for the benefit of not only our country, but the region as well,” she added.
CMC/pr/ir/2025