The Report: Trinidad & Tobago 2017
After facing headwinds such as depressed international energy prices, and rising debt and fiscal imbalances, Trinidad and Tobago’s economic recession appears to be turning a corner, with GDP growth projected to climb to 0.3% in 2017 and 3.4% in 2018. As one of the largest and most diversified economies in the English-speaking Caribbean, the country is beginning to benefit from the new administration’s process of fiscal adjustment and economic diversification, spurred on by an ambitious public works pipeline.
Despite a challenging environment, Trinidad and Tobago will be looking forward to a number of positive developments in 2017. These include the passage of key procurement legislation, a new revenue authority, improvements to education and health care delivery systems and strengthened ties with key partners, all of which will contribute to lifting the country’s political and economic profile. Over the medium term, prudent financial management, a well-educated workforce and stable democratic political system bode well for economic recovery, but to establish the foundation for long-term sustainable growth, the country must pursue diversification in earnest, while current efforts to diversify the economy should set the foundation for long-term sustainable growth.
This chapter contains a viewpoint from Prime Minister Keith Rowley; and an interview with David Granger, President of the Cooperative Republic of Guyana.Explore chapter
Despite challenges, including depressed international energy prices, as well as rising debt and fiscal imbalances, the recession in Trinidad and Tobago is likely to bottom out in 2017. The IMF forecasts the economy will grow by 0.3% in 2017 and 3.4% in 2018. The recovery is expected to come via a small rise in energy prices, the inauguration of the Juniper gas field in 2017 and an expected rise in public sector construction activity, particularly in the affordable housing sector. Achieving that modest growth rate would depend on the government being proactive in pushing forward with public works and house building. T
This chapter contains interviews with Paula Gopee-Scoon, Minister of Trade and Industry; Augusto Arosemena Moreno, Minister of Commerce and Industry of the Republic of Panama; and Terrence Farrell, Chairman, Economic Development Advisory Board. It also contains a viewpoint from Marla Dukharan, Group Economist, Royal Bank of Canada (Caribbean).Explore chapter
The new administration of Tobago takes office at a time of both opportunity and challenge. Tobago is one of the most beautiful, unspoiled islands in the Caribbean, which is a highly attractive proposition in today’s competitive tourism environment. Tobago is ready for take-off, with the island at a critical point in its economic development. After years of abundance, largely based on a share of the oil and gas revenues generated by Trinidad and Tobago, the island is now facing a fiscal squeeze. Tobago’s GDP slumped sharply in 2016, while its tourism sector has been underperforming for some time. However, these difficulties also present a major opportunity for growth.
This chapter contains an interview with Kelvin Charles, Chief Secretary, Tobago House of Assembly.Explore chapter
Following another positive year of continuing profitability and financial strength in the face of challenges related to a wider economic slowdown, in 2017 Trinidad and Tobago’s banking sector is poised to play a key role in supporting new growth. While the demand for credit has slowed somewhat in light of volatility in oil prices, liquidity in the banking system has remained high. Executives in the sector expect the economy to begin rebounding in late 2017 and into 2018. In the meantime, they are seeking to maintain a competitive edge and increase their readiness to deal with the increasing pace of technological change.
This chapter contains an interview with Anya Schnoor, Managing Director, Scotiabank; and President, Bankers Association of Trinidad and Tobago.Explore chapter
Following the 6% fall of Trinbagonian stocks in 2016, fund managers agreed that 2017 would bring further but more modest losses. Manufacturers and exporters in Trinidad and Tobago that incorporate local materials and have a strong brand could benefit from a weaker T&T dollar in 2017. With the national buy-and-hold mentality enduring, the expected listing of further tranches of First Citizens Bank and National Gas Company subsidiary NGL would bring some welcome trading activity in 2017. Nevertheless, the likelihood of continued high T&T dollar liquidity remains the central challenge to developing deeper and more liquid capital markets.
This chapter contains an interview with Subhas Ramkhelawan, Managing Director, Bourse Securities.Explore chapter
With a declining economy restricting premium-income growth and bringing rates under sustained pressure, 2016 was a challenging year for Trinidad and Tobago’s insurance sector. The relative scarcity of foreign exchange has also caused some issues with regard to the payment of reinsurers. Penetration remains relatively low, meaning local companies have significant room to expand. Total premiums represent around 2.6% of GDP, while the OECD average is more than three times higher. Barring any similar storms in the upcoming season, the sector will likely benefit from a recovery period. This will be aided by a turnaround in the energy sector, which will be a key driver of financing. While there are challenges ahead, the insurance sector seems set to re-enter a growth environment in the near term.
This chapter contains an interview with Ravi Tewari, Group CEO, Guardian Group.Explore chapter
Low global oil and gas prices have left Trinidad and Tobago’s energy sector with challenges, and underinvestment in upstream exploration has resulted in declining production and gas availability, leading to downstream industries operating below capacity. Still, the country continues to attract strong investment from oil majors and independent producers. With the government and sector players committed to crafting an equitable new fiscal regime, a strong energy services industry and a new frontier in deepwater exploration, there is good reason to expect the sector to bounce back over the medium term. This chapter contains interviews with Derek Hudson, Vice-President, Shell Trinidad and Tobago; Mark Loquan, President, The National Gas Company of Trinidad and Tobago; and Vincent Pereira, President, BHP Trinidad and Tobago & Chairman, Energy Chamber of T&T.Explore chapter
Trinidad and Tobago’s manufacturing sector is the largest in the English-speaking Caribbean. In 2016 it was expected to represent 7.8% of overall GDP, with total output worth an estimated TT$8.29bn ($1.2bn), according to government estimates. This made it the third-largest sector of the economy after the energy and services industries. Approximately 47,700 people, or 7.3% of the total active labour force, are employed in manufacturing. The country holds several competitive advantages, including cheap electricity and natural gas, two international ports that are well served by shipping lines, good availability of local or imported raw materials, a captive domestic market and relatively easy access to regional markets through trade agreements.
This chapter contains an interview with Dominic Hadeed, Managing Director, Blue Waters Products.Explore chapter
Construction & Real Estate
A gradual recovery in the number of projects on construction firms’ order books for 2017 is expected. Current performance in the sector hints that an improvement could come, based on a moderate pick-up in the energy sector and greater public sector demand. Progress is being made to develop public-private partnerships and push forward with the project pipeline. Although the real estate market has slowed somewhat during the course of 2016, the domestic residential market continues to show signs of relative strength, while the luxury and energy-related sectors have seen a cooling off. However, estate agents and industry executives note that the sector has experienced these cycles before and is on track for recovery.Explore chapter
The liberalisation of the Trinidad and Tobago telecoms industry, which has been under way since 2004 under the guidance of state regulator the Telecommunications Authority of T&T, has been one of the major successes of the non-oil economy of the last decade. The country now boasts a number of high-quality, fixed-line internet and cable TV providers, and two mobile operators, which have invested in developing infrastructure and delivering competitively priced, high-tech services. There have also been positive strides in terms of developing the domestic ICT industry. Recognising that education – both in terms of general digital literacy and advanced training – is the necessary first step towards building up the sector, the government has focused on drafting a five-year ICT in education strategy, which should be published in 2017 or early 2018. In order for the sector to grow it will be critical to develop adequate human resource talent, only then can the sector develop locally created software solutions for domestic or regional use.Explore chapter
In recent years Trinidad and Tobago’s transport sector has faced significant competition and challenges, and with government coffers squeezed by the drop in global oil prices, major infrastructure updates and the proposed creation of a multi-modal public transit system have been put on hold. In the 2016/17 budget the Ministry of Works and Transport received TT$2.09bn ($312m) in funding, far behind national security at TT$7.6bn ($1.13bn) and education at TT$7.2bn ($1.07bn). However, if government efforts to diversify industry, attract tourists and alleviate road congestion are to be successful, improvements to the country’s maritime, aviation and public transport systems should gain renewed focus.
This chapter contains an interview with Rohan Sinanan, Minister of Works and Transport.Explore chapter
As efforts to restore macroeconomic stability and diversify Trinidad and Tobago’s economy gather pace, the political emphasis on tourism is likely to continue, along with increasing private sector pressure to boost marketing. Tourism contributed 2.9% of GDP in 2016, generating $806.4m. The mixed performance of recent years could continue in the near term. However, the sector is expected to undergo significant change in the medium term, with private stakeholders leading the way. Examples include ride-hailing app Uber launching in Trinidad in January 2017, the presence of homestay network Airbnb and Sandals’ proposed site in Tobago. Long term, a move towards an open skies agreement, coupled with incentives for firms to move into the regional travel niche, presents a vital opportunity to unleash immense potential.
This chapter contains an interview with Adam Stewart, Deputy Chairman and CEO, Sandals Resorts International.Explore chapter
Health & Education
While Trinidad and Tobago’s health care system has displayed strong results when dealing with existing communicable diseases, such as HIV and Zika, work is still urgently needed to develop a long-term strategy to deal with rising non-communicable diseases in the nation. The switch to a national health care insurance system – with increased focus on portability of services, record-keeping and primary care – combined with an expanded role for cost-efficient private sector clinics and surgeries, would provide a strong foundation on which to build health care policy for the future. Meanwhile in education, following years of high oil revenues, a generous system of grants for students studying a wide range of subjects has developed. However, the economic downturn has focused minds on achieving improved performance with slimmer budgets. Tighter restrictions on funding provided by the Government Assistance for Tuition Expenses programme will help cut the fat on the tertiary education system, and the involvement of the private sector should help funnel students towards programmes that are a better fit for the development of the economy long term.
This chapter contains an interview with Brian Copeland, Pro Vice-Chancellor and Principal, The University of the West Indies.Explore chapter
This chapter explores aspects of Trinidad and Tobago’s taxation system, examining a wide range of areas of special interest to international investors, such as income and corporate tax, petroleum profit tax, withholding tax, value-added tax and Customs tax, among others.
This chapter contains a viewpoint from Angela Lee Loy, Chairman, Aegis Business Solutions.Explore chapter
This chapter provides an overview of Trinidad and Tobago’s legal framework, covering a range of topics from civil procedure rules, to the Foreign Investment Act, free zones and public-private partnerships, among others.
It also contains a viewpoint from Hadyn John Gadsby, Senior Partner, J.D. Sellier + Co.Explore chapter
This chapter contains information on hotels, government agencies and other listings, as well as useful tips for visitors on a range of topics such as visa requirements, currency and transportation, among others.
It also contains an interview with Soca musician Machel Montano.Explore chapter
Table of Contents
There are no articles in this chapter. To view the table of contents, please open click the "View in online reader" link above.