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T&T trapped in years of declining growth
By Kiana Wilburg
Despite its best efforts, the economy of Trinidad and Tobago is still struggling to find its way back to sustainable positive growth.
In fact, the country has been trapped in declining growth for the last three years. For 2016, TT’s economy grew by -6.3. The following year, it achieved -2.3 percent growth.
Its government had projected that it would grow by 1.9 percent for 2018, but the economy failed to make this mark as TT’s Central Statistical Office recently revised the figure to -0.2. (http://www.looptt.com/content/tts-real-gdp-revised-19-02-20180
For 2019, the International Monetary Fund is projecting zero percent growth for the nation, which has been in the petroleum industry for over 100 years. (http://www.looptt.com/content/imf-projects-0-gdp-growth-tt-2019).
A2 Global Risk, an international security risk management consultancy also spoke of the declining health of the Trinidadian economy in one of its latest assessments.
The firm noted that T&T’s oil production has dropped by 14.5 percent since 2012. As a result, the CARICOM member is left with little alternative but to restructure its economy away from oil and gas.
Global Risk alluded to the difficulties that may come with this restructuring since T&T has neglected its other sectors for decades while noting that a potentially disastrous impact for the national economy looms. As a result of its negligence, Global Risk said that T&T’s growth outside of oil has been low, and sometimes negative.
In fact, the security risk management firm noted that the contribution of non-petroleum sectors to the Gross Domestic Product has been shrinking.
In 2016, for example, Global Risk stated that the non-petroleum sectors constituted 66 percent of GDP, down from a 71 per cent share in 2001. Also, while most services, construction and agriculture are slowly growing, Global Risk pointed out that the food, beverages and tobacco industry which constitute the country’s largest manufacturing sub-sector, is dwindling rapidly. It said that the agricultural sector is also contracting.
In addition to this, Global Risk highlighted that domestic livestock and crops such as rice, vegetables and fruit, are losing out against more competitive imports, weighing on the country’s food security. In fact, domestic agriculture produce just eight percent of the required staple foods.
Further, Global Risk said that the country’s sugar sector, previously a major source of income, has all but disappeared as a result of high production costs. As for the production of cocoa, the firm noted that this is steadily declining due to high labour costs and poor road infrastructure development, and in 2016 reached the lowest level ever recorded, just 500 tonnes. (https://www.a2globalrisk.com/analysis/americas/a-dangerous-dependence–trinidad—tobago-s-over-reliance-on-oil-and-gas)
Since news broke of Guyana’s oil bonanza in 2015, Trinidadian companies have been flocking to these shores. They compete shoulder to shoulder with locals for the provision of skills and services in the oil industry.
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