Manning, Dhanpaul not surprised by Moody's outlook

San Fernando East MP Brian Manning -

SAN Fernando East MP Brian Manning and Opposition senator Vishnu Dhanpaul are not surprised by Moody's decision to revise TT's outlook from stable to negative in their latest credit ratings report on the country.

In a WhatsApp comment on December 13, Manning said, "TT has gone from 8.3 months to 5.4 months of forex (foreign exchange) coverage."

The former minister in the ministry of finance added, "This forex reserve decline has shown the UNC burning through US$600 million in our foreign reserves and leaving us at less than six months' worth of US currency coverage without explanation."

Manning asked, "What were those funds used for?"

He claimed there have also been reports of US$400 million being removed from the Heritage and Stabilisation (HSF), also without explanation. Manning also claimed Finance Minister Davendranath Tancoo has refused to say what these funds were used for.

"The international rating agencies will not be ignored and it is no surprise that this downgrade in outlook has occurred. The economy has been in free fall ever since this clueless Minister of Finance has taken charge and that cannot be denied."

There is no confidence in his handling of our affairs and many believe that a ratings downgrade and a devaluation cannot be far behind."

In a separate WhatsApp message, Dhanpaul referred to newspaper articles in which Tancoo described him as being unpatriotic when he expressed concerned that government's handling of the economy exposed TT to possible credit downgrades.

The former finance minister and permanent secretary in the finance ministry said, "I am never going to paint my country in a bad light."

Asked how government should respond to the revision of TT's outlook by Moody's, Dhanpaul replied, "The Minister (Tancoo) will fix it."

In a statement issued by the finance ministry on December 12, Tancoo said, "I am confident that the prudent and foresightful management of our significant forex reserves, in addition to the dynamism of our government’s new macro-fiscal approach, will foster greater economic resilience and drive a stabilisation of our outlook in the near future, as we work towards rating upgrades.”

Moody’s, he continued, changed the outlook to negative to reflect what they view as short-term downside risks to the scenario underpinning their ratings.

Tancoo said this was notably based on the decline in the Central Bank’s liquid forex reserves," which unfortunately, according to their methodology, does not include the HSF (Heritage and Stabilisation Fund)."

He added that Moody's analysis was confined to a narrow definition of forex reserves while ignoring all the significant foreign currency assets managed by other economic agents.

Tancoo said, "My only recommendation was that Moody’s should have taken a few more months to ascertain the impact of the recently implemented government strategies."

He described those strategies as "a comprehensive policy agenda aimed at rebalancing growth, revitalising the economy, securing a sustainable fiscal trajectory and stabilising forex reserves."

Tancoo said, "To adjust in December prior to affording the measures the opportunity to take effect in fiscal 2026 was too premature in our view.”

He welcomed Moody’s affirmation of TT's Ba2 rating.

Tancoo said this is predicated on "the robust credit strengths of our country – including the existence of substantial fiscal buffers such as the HSF and cash equivalent assets, amounting to 45 per cent of GDP – as well as the expectation of positive oil and gas production developments by 2027."