(o) When Criticism Should be Heard

BIMAN'S Criticism Useful

The word "criticism" is often used to describe a negative, fault-finding comment, but it more accurately means a judgement or assessment that may be positive or negative, or both. USP Economics Professor Biman Prasad's comments on the need for Government to encourage confidence to grow the economy reported in Islands Business were both. They were, I think, a fair, reasoned and helpful assessment that Government would do well to heed, despite his otherwise well-known opposition to the legality of  Government.  Photo: RadioFiji

In Biman's assessment, the political and economic situations are linked. To build local and overseas business confidence, and encourage better international engagement, especially with Australia and New Zealand, with whom our key strategic economic interest is tied, Government needs to lift the emergency regulations, the ban on free reporting, and open an inclusive political dialogue to discuss the new Constitution under which elections will be held.

These objectives are also on Government's agenda. Only the timing, and the precise definitions of "free" and "political" are in dispute. Given that Government needs an improving economy to implement its social policies, most specifically those helping the poor, those on low wages and the unemployed, Government may need to give greater urgency to its political agenda.

My assessment is that Government will not allow a free media that is not also a responsible media, or political dialogue if this means dialogue with the old political parties. But to have a positive effect on economic confidence Government must allow the media to report "critically." That, as Biman says, means a media that will report on what it considers to be good and bad policy decisions and good and bad economic news. To be acceptable to Government, this will have to be in ways vastly different to how much news used to be reported. Government says the proposed Media Decree will resolve the problem of freedom and responsibility imbalance. In other posts I have expressed my own and other people's concerns about the draft, and urged that these concerns be addressed before the Decree becomes law.

As for dialogue, it is going on and will increase in coming months. If individuals who are former MPs or members of the old political parties wish to be involved, I think they will need to publicly disassociate themselves from their former positions and express support for the People's Charter.

BIMAN'S Economic Assessment. The Government is in a "tight fiscal position and is likely to remain so for some time. It must undertake extreme austerity measures to contain the budget deficit and meet its domestic and international debt commitments. This will limit its ability to undertake further social protection support to the poor and deliver services in an effective manner. As a result, poverty is expected to increase in thenext few years, and the poor will have more difficulty in meeting basic needs such as health and education."

BIMAN  commended Government for its actions assisting the poor and vulnerable. Specifically, by raising the income tax threshold from $9,000 to $15,000; reducing duty on basic food items; increasing welfare assistance; passing the minimum wage legislation; introducing the food voucher system; subsidized school bus fares and text books; and support for farmers to increase their production and incomes.

Further, the 20% devaluation of the dollar helped offset the decline in the EU sugar price and assisted the tourism industry, but it, of course, also added to inflation (up to 7.7% in 2008, partly due to higher global food prices, down to 3.7% in 2009). The full impact of devaluation and higher oil process could lead to higher level of inflation in 2010.