PPP urges responsibility in confronting financial crisis

Mar 01, 2009 News

– says call for resignation of Finance Minister “outrageous”

The ruling People’s Progressive Party (PPP) is urging responsible action from all stakeholders as small countries like Guyana experience the “inevitable” consequences of the financial crisis that is currently gripping the global economy.

The party expressed grave concern at what it said were “reckless and irresponsible” statements that have been made by the political opposition on the government’s handling of the collapse of CLICO, and the problems with the Hand in Hand Trust Company as a result of the clampdown on the Standford investment group by U.S. regulators.

The main opposition People’s National Congress Reform (PNCR) has called for the resignation of the Finance Minister Dr Ashni Singh and the Commissioner of Insurance Maria van Beek, but the ruling party said this call is “outrageous”, given the fact that current developments are known by all objective persons to be the direct result of global and regional events.

In calling for the resignation of government officials, the PPP said the Opposition has demonstrated how far removed it is from reality.

“Throughout the Caribbean, finance ministries, central banks and other financial sector regulators are all grappling with the situation caused by CLICO and Stanford.

“In both Trinidad and the Bahamas, intervention and court action in relation to CLICO have become necessary, while in Antigua the government intervention in Stanford has similarly become necessary,” the PPP stated.

It said the call represents another example of the complete lack of awareness of external factors by the Opposition, and “further evidence of their well-known tendency to resort to politicking on every occasion that presents itself.”

Following the Bahamian government takeover of CLICO, the government here made moves to have CLICO (Guyana) come under judicial oversight, with Van Beek as the Judicial Manager.

Following President Bharrat Jagdeo’s announcement, the PNCR lashed out at the Government, saying the Jagdeo administration has conducted itself in the most irresponsible manner in relation to valuable assets held by the Guyanese people.

The PNCR referred to the thousands of workers who are dependent on the National Insurance Scheme (NIS) which has an investment of about G$6B in CLICO.

The PNCR said the Government did not act with dispatch to protect the investment made by the Guyanese workers in CLICO, and it has not put in place the necessary measures to assess the implications of the Hand-in-Hand Insurance Trust Company losing nearly US$1.5 million in pensions.

According to the PNCR, “even as the Jagdeo Administration was sitting on its hand and burying its head in the sand, there is more than enough evidence that they knew that the CLICO Insurance Company was in serious trouble”.

However, the PPP insists that the Government of Guyana moved swiftly and decisively to confront the consequences that these developments might have for financial institutions in Guyana.

Minister of Finance Ashni Singh pointed out that neither in Trinidad nor the Bahamas did the governments pre-empt regulatory intervention by making irresponsible statements to cast doubt on the strength of the institutions.

In both countries, the first pronouncement by the authorities was the announcement of regulatory action or intervention.

The PPP has acknowledged that, as stated by Dr Singh in his budget presentation, no country will be spared the effects of the current financial crisis, and that it is essential that all national stakeholders work together to ensure that the economy remains sufficiently resilient to withstand the current externally imposed shocks.

The party said it applauds the assurances given by Government that steps will be taken to protect the pensions of those who have saved and invested in the institutions affected by the recent events.

While commenting on developments in Guyana, the Leader of the Opposition Robert Corbin has thus far failed to disclose the fact that he was fully briefed by President Bharrat Jagdeo on Government’s intention to move to the court in relation to CLICO, the PPP stated.

The PPP also made mention of the fact that a news broadcast on Channel 28, which is owned and operated by PNCR front bencher Mr Tony Vieira, cast aspersions on the strength of the Guyana Bank for Trade and Industry. The newscast has since apologised for carrying the false report.

The ruling party pointed out also that the Opposition has maintained a stony silence in relation to, and has failed to condemn, false statements that were published on the internet regarding the strength of financial institutions in Guyana. The statements have since had to be retracted and apologies issued.

“These positions taken by the political opposition must be seen by all Guyanese for exactly what they are: exploitation of an externally imposed situation for the purposes of partisan politics by the Opposition in the face of a clear call by the Government for the country to work together to confront the challenges currently before us,” the PPP stated.

The party added too that the position taken by the Opposition is also an exposure of the hypocrisy of the PNCR’s call for shared governance, while in the face of external threats to economic and social progress they are seeking political mileage.