AT HIS last quarterly press conference, BOJ Governor, Derick Latibeaudiere adjusted his growth targets downwards. He disclosed that the Bank had revised its growth forecast for the fiscal year downwards to 1.0 to 2.0 per cent from the original 2.0 - 4.0 per cent.
According to the Governor, the revision of the target was linked to the events of September 11 and the temporary closure of the Jamalco plant following industrial action by unionised workers. Significantly, this revision of the growth target by the Central Bank came some hours before Minister Paulwell's revelation that his much publicised 40,000 information technology (IT) job target was not on. In his case Minister Paulwell attributed the abandonment of his target to the failure to attract foreign capital into the sector, shortage of appropriate factory space, and a shortage of skilled labour.
Taken together, these latest revisions of targets suggest that a level of realism is now informing government policies. Interestingly, in the same vein, news from the Cabinet retreat is that the Prime Minister has said that Government will not be announcing any new projects in the budget this year but will instead be concentrating on completing ongoing projects. Of course, this new realism in government programmes is most likely triggered by the impending elections and an attendant need to appear open and transparent with the electorate.
But whatever may be the Government's objective in opting for realism instead of the temptation to bury its nose in the sand, it should be a definite plus for the economy.
What is still missing, however, is that the new realism needs to be extended to include a greater focus on the social agenda and its negative impact on the economy. This is especially critical given the usual divisions that are highlighted in an election year, and the formidable crime problem.
Realism in economic policies, if sustained, augurs well for economic planning. A similar strategy should be adopted with the social problems.
