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Self-sufficiency — a strategic objective

Oct 22,2017 - Last updated at Oct 22,2017

In one of his recent meetings with the public, in a southern town, to promote his government’s policies, Prime Minister Hani Mulki told the public that self-sufficiency is the country’s strategic objective.

This is, of course, a simple goal, met with general acceptance. Everybody knows that a state that depends on subsidies from others is not politically independent. It has to be loyal to the donor country and support its positions, whether they are right or wrong.

It also has to use every opportunity to prove its value and stand ready to provide strategic services if and when it is requested by the donor country to do so.

People fully agree that achieving self-sufficiency is a matter of priority, just like independence and freedom. However, they disagree on how to achieve this strategic objective or on standing ready to pay the inevitable price.

No one would object to the self-sufficiency slogan in a popular gathering. Of course self-sufficiency is a strategic objective, but people disagree when they are required to make the necessary sacrifices to achieve this objective that does not come cheap.

In our case, fiscal dependence on others is obvious when we need to bridge budget deficit through foreign grants, which do not come without conditions.

Dependence on others, in our case, can also be seen in the way we search for funds through borrowing, which makes public debt accumulate to a level where the country is unable to service the debt and pay interest and instalments on time, as happened in 1989.

Many populists would say that the middle class, which is the society leader and majority, should not be taxed, because their low income does not enable them to pay, even though their alleged poor status allows them to drive the latest styles of cars, and change their smartphones regularly to keep up with the latest improvements.

To tell the truth, to reach self-sufficiency we need to increase taxes and reduce subsidies which consume the government’s limited recourses and put more pressure on the government to borrow to be able to meet its obligations.

Borrowing provides a temporary solution and only makes a country postpone facing problems, while allowing them to accumulate to a point of crisis that threatens economic, fiscal and social stability.

Yes, self-sufficiency is a strategic objective, but what are we ready to do in order to achieve it or approach it?

 

We do not have a precise plan to reach a state of self-sufficiency, but we have an economic reform programme, supported by the IMF, which tries to bring us nearer to this strategic objective.

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