The Cen­tral Bank an­tic­i­pates an in­crease in oil and gas pro­duc­tion in 2017, but says an econ­o­my-wide re­cov­ery is "like­ly to take some time to be firm­ly es­tab­lished" be­cause glob­al en­er­gy prices re­main very un­cer­tain.

The Cen­tral Bank's analy­sis is con­tained in a new five-year strate­gic plan, from fis­cal 2017 to 2021, which is dat­ed Sep­tem­ber 30, but was placed on the in­sti­tu­tion's web­site on Oc­to­ber 21.

As a re­sult of the slow­ness of the re­cov­ery on the on-shore sec­tor, ac­cord­ing to the Cen­tral Bank, T&T "can ex­pect to con­tin­ue to op­er­ate in a chal­leng­ing do­mes­tic en­vi­ron­ment over the ear­ly part of the five-year span of the strate­gic plan."

This will mean that the Bank's man­date to main­tain in­fla­tion will be placed in the con­text of "like­ly se­vere con­straints on eco­nom­ic growth."

The strate­gic plan says as there is a pos­si­bil­i­ty that the eco­nom­ic slow­down could im­pact on the abil­i­ty of bor­row­ers to ser­vice their loans, the Cen­tral Bank will have to pay "very close at­ten­tion" to fi­nan­cial su­per­vi­sion of the qual­i­ty of loans ex­tend­ed by fi­nan­cial in­sti­tu­tions.

The Cen­tral Bank said that the in­ter­na­tion­al scene is like­ly to re­main "un­set­tled for some time" in the wake of con­tin­ued weak­ness in Eu­ro­pean economies, the de­layed sus­tain rise in US in­ter­est rates, the fall­out from Brex­it and ner­vous­ness about in­vest­ments in emerg­ing mar­kets".

It said the loss of cor­re­spon­dent bank­ing re­la­tion­ships is of par­tic­u­lar con­cern to Caribbean coun­tries.

"The grow­ing in­te­gra­tion of Trinidad and To­ba­go's fi­nan­cial mar­ket with the rest of the world, de­vel­op­ments in in­ter­na­tion­al pay­ment sys­tems, cre­ation of new fi­nan­cial prod­ucts, in­ci­dence of cross merg­ers and ac­qui­si­tions will quick­ly im­pact the do­mes­tic mar­ket," ac­cord­ing to the Cen­tral Bank.

Fol­low­ing their sum­mit in Guyana ear­li­er this year, Caribbean Com­mu­ni­ty (CARI­COM) lead­ers an­nounced that a glob­al con­fer­ence on the is­sue will be held in An­tigua this week.

Cor­re­spon­dent banks, which are main­ly large, in­ter­na­tion­al banks based in the Unit­ed States of Amer­i­ca, Eu­rope and Cana­da, pro­vide Caribbean states with vi­tal ac­cess to the in­ter­na­tion­al fi­nan­cial sys­tem, by of­fer­ing ser­vices to small­er, do­mes­tic banks and fi­nan­cial in­sti­tu­tions to com­plete in­ter­na­tion­al pay­ments and set­tle­ments.

How­ev­er, many banks, which pro­vide cor­re­spon­dent bank­ing ser­vices have been seek­ing to man­age their risks by sev­er­ing ties with in­sti­tu­tions in the re­gion.