The trinidad Guardian / Although JMMB Investments (T&T) Limited is pleased with the reduction in government expenditure by $3 billion from last year’s budget, they are concerned the $50.5 billion expenditure projected for this year, was in excess of the projected $37 billion in core revenues.
They said given the soft economy, this comes with a downside risk.
In its post-budget highlights, JMMB Investments T&T said the projected $13.5 billion deficit was to be financed from increased borrowing of $4.5 billion and $7.5 billion from the sale of CL assets and draw-downs from the HSF.
They said, “In light of the higher than previously budgeted borrowings in 2017, we are concerned with further borrowings to the level of $4.5 billion.”
JMMB T&T acknowledged there would be some inflationary impact as retail diesel prices increased by 48 per cent to $3.41 and super gasoline increased by 11 per cent to $3.90.
Commenting briefly on the increase in Corporate Tax from 25 per cent to 30 per cent, the investment firm argued, “It will negatively impact the SME sector and we would have liked to see a minimum profitability threshold.”
Even though they believe the proposed reform around the Supplemental Petroleum Tax and implementation of royalties is a positive move, they are waiting to see how it will be implemented before making any pronouncements.
JMMB T&T said, “The economic growth strategy articulated by the Minister continues to be dependent on energy output and gas findings coming into production.”
“However, we know that there are a number of risks with this assumption. No new diversification initiatives were outlined nor any specific progress update was given on previously announced initiatives.”
They indicated their support for the offering of CLF assets to the public as a transparent means of disposal, which they said would add to the existing suite of local investment vehicles.