Raphael John-Lall

Pres­i­dent of the T&T Man­u­fac­tur­ers’ As­so­ci­a­tion (TTMA) Roger Roach be­lieves busi­ness peo­ple face a “crit­i­cal” sit­u­a­tion in at­tempt­ing to ob­tain for­eign ex­change (forex) for in­ter­na­tion­al busi­ness.

“I don’t think that there is a cri­sis, but I think that it is crit­i­cal. I think it is crit­i­cal for the mere sense that if this forex win­dow were to be tak­en away, would we be as suc­cess­ful as we are to­day? For ex­am­ple, Gov­ern­ment pro­grammes are not guar­an­teed. It is not like we see the forex win­dow at the Ex­Im Bank of T&T and we say it is go­ing to be here for the next ten years and will keep re­cap­i­tal­is­ing it. What we are hop­ing to do is that with­in the pe­ri­od that it is avail­able, is to max­i­mize it and to build our own for­eign ex­change earn­ings. So that is ba­si­cal­ly the pro­gramme that we are on. So, we are fo­cus­ing on trade mis­sions and ex­port­ing and build­ing ca­pac­i­ty,” he said.

Roach spoke last week at a fo­rum on gen­er­at­ing for­eign ex­change for T&T host­ed by the Trade and Eco­nom­ics de­part­ment of the Uni­ver­si­ty of the West In­dies (UWI), St. Au­gus­tine.

He lament­ed that the sys­tem of al­lo­ca­tion of for­eign ex­change to dif­fer­ent seg­ments of the busi­ness com­mu­ni­ty is not fair and said that in­di­vid­u­als mak­ing pur­chas­es on­line alone con­sumes bil­lions of dol­lars.

“We know who the net earn­ers of for­eign ex­change are in the coun­try and they do not ac­cess the Ex­Im Bank. Nine­ty per cent of it is for small and medi­um-sized en­ter­pris­es. This forex sit­u­a­tion has been go­ing on for years. There are cer­tain seg­ments in the re­tail sec­tor, they are just im­port­ing items in­to T&T, sell­ing it in T&T and they seem to be get­ting an in­or­di­nate sup­ply of US dol­lars in a seg­ment that has a glut in the mar­ket. Every­thing that is avail­able in a mall in T&T, you could buy it on­line and there are some peo­ple who sit in their hous­es and pur­chase on­line and when you pur­chase on­line, that cred­it card has to be set­tled im­me­di­ate­ly to Mas­ter Card or Visa. I think it is a cou­ple bil­lion dol­lars that is used to set­tle cred­it card pay­ments. We are im­port­ing Dunkin’ dough­nuts and food from abroad. To­tal non-es­sen­tial items.”

He al­so said that the TTMA has been work­ing with its mem­bers to en­sure that man­u­fac­tur­ing con­tributes more to the coun­try’s econ­o­my.

“The TTMA has been wa­ver­ing be­tween a con­tri­bu­tion of 18 per cent to 20 per cent of the coun­try’s Gross Do­mes­tic Prod­uct (GDP) and we set a goal some years ago, in com­ing up with our man­u­fac­tur­ing strat­e­gy, to dou­ble our non-en­er­gy ex­ports by 2025 from a 2019 base year,” said Roach.

Chal­lenges

Roach al­so spoke about fac­tors that pre­vent lo­cal com­pa­nies and busi­ness­es from mov­ing on to the next step of ex­port­ing abroad.

“We have found an un­will­ing­ness to bold­ly go where they have not gone be­fore and we have tak­en an al­most evan­gel­i­cal ap­proach in help­ing busi­ness­es un­der­stand that once you for­mu­late your strat­e­gy…ex­ports must be an in­te­gral part of busi­ness­es’ strat­e­gy.”

He added that that many busi­ness­es in T&T are fam­i­ly run and fam­i­ly owned and while there are pos­i­tive as­pects about this, there are al­so chal­lenges.

“Some com­pa­nies lack the ca­pac­i­ty to de­vel­op busi­ness pro­pos­als and plans. Busi­ness pro­pos­als, even though they change rapid­ly in an en­tre­pre­neur­ial en­vi­ron­ment, help the com­pa­ny to source ex­ter­nal fi­nanc­ing.”

He al­so said large com­pa­nies are al­ways ea­ger to par­tic­i­pate in trade shows and this aids busi­ness com­pet­i­tive­ness as busi­ness peo­ple learn how to de­vel­op new prod­ucts and to net­work.

“While some large cor­po­ra­tions have ex­port de­part­ments…they have an ex­per­tise of go­ing in­to a mar­ket, as­sess­ing these op­por­tu­ni­ties and cap­i­tal­is­ing on them that some small and medi­um-sized busi­ness­es do not have. So, the TTMA has tak­en an evan­gel­i­cal ap­proach on tak­ing busi­ness­es on key trade mis­sions. Be­tween 2022 and 2024, we have car­ried a num­ber of com­pa­nies all over the Caribbean.”

Roach al­so gave the opin­ion that there are some suc­cess­ful busi­ness peo­ple in T&T, who have earned for­eign ex­change and gen­er­at­ed per­son­al wealth and in­stead of be­ing in­no­v­a­tive and com­ing up with new prod­ucts and ideas to ex­port and earn for­eign ex­change, they are sat­is­fied with the sta­tus quo.

“Some com­pa­nies are com­fort­able in their mar­ket space. There is a gold­en age in T&T where you could have sold your prod­ucts in T&T, do very well eco­nom­i­cal­ly. Some peo­ple al­ready bought their dream homes, dri­ve large lux­u­ry cars, live a very good life and trav­el the world. To tell those per­sons to go out in­to the mar­ket place now to look for new busi­ness, we have found that there is a gen­er­a­tion that is very com­fort­able. Some busi­ness­es have is­sues with suc­ces­sion and there is no mo­ti­va­tion to take the busi­ness­es fur­ther.”

How­ev­er, he qual­i­fied that by say­ing that there is a young gen­er­a­tion of en­tre­pre­neurs who the TTMA is tak­ing on for­eign trade mis­sions as they have the de­sire to de­vel­op new prod­ucts for new mar­kets.

Ex­port­ing mind­set

CEO of the T&T Coali­tion of Ser­vices In­dus­tries (TTC­SI) Vashti Guyadeen, who al­so spoke dur­ing the we­bi­na,r said that her or­gan­i­sa­tion has had to work with many busi­ness own­ers in the ser­vices sec­tor who nev­er saw the po­ten­tial in de­vel­op­ing prod­ucts for for­eign mar­kets.

“To de­vel­op a cadre of ser­vices ex­porters we need­ed a long-term pro­gramme. We need­ed not just to pro­vide them with the tools to de­vel­op an ex­port plan but we need to ac­tu­al­ly pro­vide them with coach­es over a nine to 12 month pe­ri­od. In or­der to build a na­tion of forex earn­ers, one of the gaps that we have to ad­dress is do­ing some rad­i­cal re-think­ing and re­struc­tur­ing, where­by in essence, it means build­ing the ex­porters’ mind­set. Over the pe­ri­od 2021 to 2023, in col­lab­o­ra­tion with a Cana­di­an firm, we de­vel­oped ‘Gate­way to Trade.’ This was an in­ten­sive ac­cel­er­a­tor pro­gramme just for the ser­vices sec­tor.”

She al­so said that the ser­vices sec­tor does not have the re­sources that the man­u­fac­tur­ing and en­er­gy sec­tors have, so her sec­tor has had to be cre­ative in its ap­proach.

“How you han­dle a trade mis­sion for a man­u­fac­tur­er, it is not the same ap­proach or method­ol­o­gy that you have to use for the ser­vices sec­tor.”

She al­so said that many busi­ness­es need help in mar­ket­ing and sell­ing their ser­vices.

“If we have to build the for­eign ex­change ca­pac­i­ty of the ser­vices sec­tor, these are some of the chal­lenges that we are fac­ing, which is the ex­porters’ mind­set. Many busi­ness­es are ac­cus­tomed to busi­ness com­ing in­to them but they are not able to mar­ket them­selves. They do not know how to pitch their ser­vices. Be­cause you are a ser­vice provider, you do not have a prod­uct and you are sell­ing your­self and you need to have con­fi­dence in your­self,” said Guyadeen.