In 2015, our GDP had declined for four consecutive quarters—we were in a recession which was caused by the reduction in foreign exchange earned by the energy sector. This situation continued into 2020, forcing the Government into continuing deficit budgets, the use of the HSF and drawdown on the foreign reserves. Then came the Covid-19 pandemic with its disruption of both global demand and supply chains, with the Government incurring further debt to protect those who could not support themselves locally as our economy contracted under lockdown conditions and an attempt to keep some economic entities afloat. The debt-to-GDP ratio is expected to be some 80 per cent by 2021.
Given the severe curtailment of financial resources available to and the accelerating debt of the Government, some cuts in its spending had to be made. One of these areas is now in education, where the number of scholarships has been reduced: GATE was stopped for post-graduate education and only allowed for one undergraduate programme per student from a limited list of academic areas from which “STEM” should be emphasised. Further, the amount paid on GATE to a particular student depends on a means test of his/her household—no GATE is available if the monthly income of such a household exceeds $75,000/month. Bursaries are also available depending on the student’s performance. Alas, UTT is also closing some of its campuses!
The conditions under which students were funded by GATE before these cutbacks suggest the Government’s approach to education was that of providing a social service, say, like health or URP, and which was meant to ensure that as many as possible, according to financial resources of the Government, attained higher skills and, as a result, higher-paying jobs, whether these jobs were in T&T or elsewhere. Indeed, an IDB report that covered the period 2000-2008 showed that some 70 per cent of our graduate labour force emigrated. Also, a paper by Carrington, et al, UWI, showed even in 1998 that some 57.2 per cent of our graduates also emigrated. Clearly such a level of emigration had no negative impact on Government funding of tertiary education, including post-graduate programmes.
What is of interest, however, is that though T&T was producing highly skilled graduates, its assumed social responsibility, these made absolutely no positive impact on the development, diversification, of the country’s economy. Especially so when as a small open economy, it is imperative that we export to survive. Further, these exports have to be globally competitive, and today such competitiveness is based on knowledge, innovation; the role that our highly trained/educated graduate workforce, via GATE, should have adopted.
This failure was not singularly the fault of our graduates since the economic concern of our Government, as discussed in one of my recent articles, was at the lower-level dance floor—a reaction to current circumstances of the local and global economies, as opposed to considering also a longer-term plan based on strategic thinking. Our private sector is not about this kind of thinking either. Strategic thinking is taking a view from the balcony and identifying, imagining and comprehending the possible futures that the global environment may have, such that we could use this knowledge to generate our own thinking and so produce the relevant graduates; particularly those who were educated to the post-graduate level and could conduct the required R&D, who can effectively transform our economy. The fact that GATE has now been discontinued for post-graduate programmes says volumes about the present thinking of our Government.
The current focus of Government is to understand the country’s existing situation. Concerns are about what will be the global demand for and price of natural gas; what will be the same for our petrochemicals; what can we even expect from the tourism sector; what can we gain from a dry-dock and new Chinese companies in Phoenix Park?
Hence, there is no infrastructure, no institutions that focus on strategic planning, preparing to innovate in our imagined global futures that could be evolving around us; what could happen given global warming, shortages of commodities, food and water, depletion of our petroleum resources, political conflict across the world and the emerging technology wars? We have no innovation systems, triple helix models, that are focussed on our visions of the future, on the R&D and the use of our highly skilled graduates that could produce the globally competitive exports—what diversification is about.
Our universities do research, their staff publish and are promoted. But none of this is deliberately geared to our economic transformation. Even today The UWI has a company called UWI Ventures which is offering help to both staff and anyone who may have an “ah ha” moment with the prospect of an innovative product or service. Indeed, instead of providing as much of a social service as we can afford in education, we also have to provide the investment to build the talent, the knowledge, higher-level skills and institutions that are required to support the required innovation systems.
Today the global economies are all adopting the fourth industrial technologies in their businesses, and are turning to the digital technologies that are disrupting markets. Opportunities exist for us to use these technologies and focus on disruptive innovation where we seek to provide innovative products and services to under-served markets. Still our economic history has been about certainty in the energy sector in a global economy that is now very uncertain.
THE AUTHOR is an economist