Wednesday, March 18, 2015

Vishnu is Lucky, Again

To be Finance Minister these days. After almost a quarter of a century. Because that's after almost 10 years of the worst economic management -- Paglanomics -- our country has seen and started by Rama Sithanen with the help of Bretton Woods Ali. And of course with the blessing of Andrew Scott and one crypto-socialist, Navin Ramgoolam. So improving things should not be that difficult. For example increasing pensions has helped compensate the lack of reasonable progress that the weakest groups of our fellow countrypersons have registered with the toxic bean-counters. And there are many more low-hanging fruits to pick.

But monetary policy was definitely not one of them. So it was quite surprising that Manou Bheenick was asked to leave. And replaced by depreciation-obsessed Basant Roi. Who unsurprisingly since returning to the BoM less than 80 days ago has presided over a double-digit depreciation -- 12% as of today -- of our national currency against the USD. After our central bank had issued a communique on January 30 informing the nation that there would be no MPC meeting in February because Lutchmeenraidoo's budget was due March 16. Or 45 days later.

Hopefully the Minister of Finance who keeps on insisting that he will deliver a 'second miracle' understands how to assess the quality of economic policies. Computing our real GDP growth in USD for the current quarter might be quite enlightening.

6 comments:

Anonymous said...

And what do you think about the forecasted growth level by the FM? Is this realistic?

Sanjay Jagatsingh said...

5.3% this year and 5.7% next year. Growth is just one statistic. There are many more parameters that go into an evaluation of the performance of national policy-makers.

Anonymous said...

yes he's lucky, like now - being the saviour of BAI victims!

akagugo said...

"Depreciation obsessed".
Never better said!

Anonymous said...

Fine faire nous roupie vine poudine maïs...

Sanjay Jagatsingh said...

Just computed the change in USD of our quarterly GDP for 2015Q1 compared to preceding year: -12.2%. How do you like it? So his obsession with depreciation has literally put us into a depression in dollar terms. If we use end of quarter exchange rates. Will also do it with average rates for fun.

Oh plus our GDP in USD in 2015 was about USD1.2 billion lower than its 2014 levels. That's 9.9% lower. Again a depression.