As the voice of the country’s business, the Trinidad and Tobago Chamber of Industry and Commerce aims to help achieve ongoing development towards a strong and sustainable national economy. In an interview with United World, President of the Chamber Mr Moonilal Lalchan talks about how the country is trying to achieve economic diversification, and the important role the Chamber has to play in facilitating this processTrinidad and Tobago has a long standing reputation as a great investment destination and one of the highest growth rates in the region. As the voice of the private sector, can you start off by giving us your insights into the current state of the economy?
The economy looks good. We’re expecting growth of 2.5 to 3% this year; growth will continue to be based on the oil and gas sector because we believe that is the sector that we need to continue to build on. If the oil and gas sector is successful, diversification will take place so that when oil and gas do run out, you’ll have other areas like ICT, shipbuilding and repairs, and Tourism. Tourism in the classical sense is not going to really make a big impact in Trinidad; however Tobago will be the central focus for the tourism industry. That will involve increasing the room stocks and encouraging more international hoteliers to come in and invest. We don’t have the room stock right now which is why we don’t have enough daily flights coming into Trinidad and Tobago. Diversification is a big buzz word at the moment; it will play a major role in the future of TT’s economy. The Government has identified 7 key sectors which will create a more diverse and sustainable economy. How do you feel the diversification efforts are going thus far, what area’s do you feel will be the most challenging?
There are several different areas that have been targeted by the government, including finance, ICT, shipbuilding, tourism, and of course energy. We believe the government is going in the right direction. They have put in place the infrastructure to deal with things like the ease of doing business, through the TTBizLink a one stop shop where you can go to one place to take care of registering any business with all the people you need in one place, quickly and efficiently.
Another area that we have been concerned about is what we are doing as a country to develop the capacity and the human capital to meet the growth and demand of diversification. The government is making significant strides through the Ministry of Education and Science and Technology, they are putting emphasis in the right place. The Government has recently introduced a drilling school to aid in the development of our oil and gas potential. Almost two thirds of our waters haven’t been explored as yet, so it makes sense to further develop those areas and also the skills of our people in that area. We can then export our talent to other places like Africa where they have found huge reserves of oil and gas. This school also presents itself as a great opportunity to bring in people from other countries to train. As an example, we recently had a number of students from Nigeria here learning skills from us for the oil and gas industry that they can take back to their county.
The perception of unemployment in my opinion is another issue. We believe we need to get our population back to creating value-added jobs. We have a shortage of qualified persons in certain industries, so much that we are forced to import labor from other smaller Caribbean countries. The official unemployment rate is 3.7% but the number is very low due to the UNDP and CPAP programs. We need to get people trained in the right areas and increase productivity. Most of the people on CPAP we find work 3 to 4 hours a day, whereas you could put them in more meaningful jobs to work an 8 hour day and continue to build the economy. Nearly 65% of our people work in government jobs and nobody wants to leave a government job to work in the service industry, but we shouldn’t have to import so much labor from other countries to fulfill our service demands; we should be able to become more productive with what we have.How much collaboration is there between the government and the chamber t make sure they understand the concerns of the private sector?
We’ve had a huge amount of collaboration. We meet on a regular basis almost 3 times a month with different government officials and organization. We have a very good relationships with all of the government Ministers. The government here really understands the value of the private sector and we feel they make a lot of effort to collaborate with us.In this current administration, there have been a lot of changes in the Cabinet, with Ministers moving from portfolio to portfolio, every year in some cases. How much is this affecting the private sector?
There is a significant impact on the business community. Each time you change a Minister, you often change the permanent secretaries who are the ones who are really the CEO of the Ministry. Each new minister that comes in to the Ministry has to understand the issues facing both the Ministry and the private sector. They also need to review what the previous minister did and all of this takes months before they can even start taking decisions. There is continuous change, and we have to go back and start all over again with each new minister. That has a destabilizing effect on trying to get things done and the continuity and sustainability of some of the things we have tried to put in place.A stable private sector is one of the most important indicators for a foreign investor. What is your view on the stability of the private sector and what is it that makes this country so attractive for FDI?
The private sector in Trinidad and Tobago is one of the most stable in the region. The environment is very, very good for foreign investments with a very good infrastructure and a cheap source of energy. We have a very skilled labor force with some of the best engineers in the world. A good example is the management of Atlantic LNG; it is made up of 98% local and 2% international executives. The pay is reasonable and competitive with the rest of the world. We have never taken away or sequestered people’s assets. The whole environment assures that investments are secure and their profits can be repatriated. We also have a very favorable tax system with incentives and tax holidays, plus some additional tax measures in place to support the petroleum industry. During our interview with the Hon. Winston Dookeran, he stated that “the relationship with the US is the most important relationship for Trinidad and Tobago, despite the interest from the Far East; it’s the oldest, longest, and greatest.” The United States is a large investor in Trinidad and Tobago and its leading trading partner. There are also a number of America’s largest multinational companies with offices in Trinidad and Tobago. In your opinion, how important is the unique and special relationship with the US to Trinidad and Tobago?
On several fronts, I think the US will continue to be a significant partner. We are the most influential country in the Caribbean and the center of financial activities in the region. Strategically, we are very close to the South America, especially Venezuela. As a small country, there are certain things we cannot do for ourselves, so it is imperative that we maintain strong and strategic partnerships with the US. The transfer of technologies from large companies in the United States to Trinidad continues to be a great benefit to our small island nation as well. In what areas do you think there could be more cooperation between the two countries and what are the major investment opportunities you think would be interesting for US investors?
For the potential investor, the biggest benefits would be the downstream oil and gas industry. The diversification of the country is also attractive to foreign investment. Instead of going to India, with our proximity to the US, with English as our first language, and a subsea cable, ICT can grow rapidly in Trinidad. The country is also positioned as a good transshipment hub for access into the South American market, especially after the Panama Canal is widened. In terms of shipbuilding, we could convert ships to the use of LNG as the fuel of choice. There is also always more room for growth in the oil and gas sector because we still have so much unexplored area.