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After three years, IDB’s Bermudez says adiós to T&T
Tomas Bermudez, country representative, Inter-American Development Bank (IDB), has completed his term in T&T.
Bermudez, who took office in 2015, believes he has accomplished his objectives during his short tenure in T&T.
Departing at the end of January, Bermudez will head the IDB office in Latin America’s biggest Spanish speaking country, Mexico.
His successor for the IDB T&T’s office will be a banker from Peru.
The IDB is a developmental bank which is headquartered in Washington DC.
Bermudez gave his final interview to Business & Money last Friday by phone.
Bermudez said his biggest accomplishment over his tenure was making sure that loans that were “not performing well” were improved.
“That was just before the change of the last administration so when the government changed, we focused on two things. One was a different fiscal situation where tough decisions had to be made. So we took decisions with the Ministry of Planning to eliminate those things that were not an important part of the loan portfolio.”
Some of the areas in the loan portfolio include water and sanitation plants, education, health and global services related to economic diversification.
He said they have not approved new transactions in the last three years.
“We focused on making sure that the loans we had performed well. We cut back on the loans that were not performing and we have not really approved new ones. We made our concrete strategy for the country for the next five years.”
He said the IDB should be offering new loans to the country this year.
Bermudez pointed out that one of his goals was for the country to develop a different perception of the IDB.
“When I compared T&T to Latin America and the perception of the bank, it feels that T&T was a more ‘distant cousin.’ When I was at the IDB in Panama, I felt that the bank was a closer partner of the people. In T&T, there is not a strong sense of ownership of the IDB.”
He said one of the significant strides of his tenure was making the IDB more accessible to the people of T&T.
“I think people understand now more of what we do as there was not much understanding of what we do. We also tried to reach out to areas that were not traditional for us like the creative industries or what we call the Orange Economy. Those were areas that were not common to us. We also tried to talk to the people and not the usual stakeholders.”
Last November, IDB launched the Unfollow Campaign with the goal of engaging with stakeholders that were not traditionally associated with the bank.
“It is a way of promoting what we had in our country strategy and saying to the public this is what the future of the country looks like. A discussion about the possibilities of T&T was needed. It is refreshing to talk about the future. We have our country strategy, the Government has the 20/20 Vision. For this campaign we are having a number of events along the pillars of the strategy such as private sector development and improvement of government institutions.”
He said one of the projects that he started and that his successor would continue to tackle is the inefficiency of public utilities, specifically the Water and Sewerage Authority of T&T (WASA).
“There needs to be more attention and a sense of urgency in WASA. I have the utmost respect for Robert Le Hunte, Minister of Public Utilities. He is trying to do a good job. He is a person driven by metrics. He is the ideal person needed to carry out what should be done there.”
Bermudez said they have worked with Le Hunte’s ministry on short-, medium- and long-term interventions for the water losses in the system.
“We think that the number of losses in the system is very big. So finding ways to address those, we put together a plan for them late last year. It will require political will and funding.”
He said it may not be a “huge investment” but it will add up.
“Right now the budget for WASA does not capture anything on capital expenditure (capex), it is mostly operational expenses. The IDB would be happy to provide funding for WASA.”
He said that they are not only a funding institution but also a consulting arm for the government.
“We bring technical assistance. Citibank, Goldman Sachs and other big banks of the global financial markets will issue a bond but will not provide that. In the end money is a commodity and the IDB is the cheapest source of funding that is available and that makes us more attractive.”
Bermudez said they are still working on the plan with the Government.
“The Government is spending an excessive amount of money to sustain WASA. The cheques that the Ministry of Finance write to WASA annually is equivalent to 1.5 per cent of the gross domestic product (GDP) of the country. Even if it was affordable at one point, I do not think it is affordable anymore.”
Bermudez said the IDB has an allocation of US$120 million for 2018 for T&T.
“It will depend on if T&T wants to use that or not. It will be a discussion between the Government and the bank. That is what the IDB’s management has set aside for T&T. In the last two years we set aside a similar amount but decided with the Government not use it.”
He said instead, the Government and IDB decided to focus on what they already had in the portfolio was performing well.
“This year we will start using the allocation again. I am not sure if the US $120 million will be used fully or just use a portion of it. That is part of the ongoing discussion,” he said.
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