The clo­sure of Petrotrin’s re­fin­ery will have a neg­a­tive ef­fect on sur­round­ing busi­ness­es and com­mu­ni­ties.

Dr Roger Ho­sein, se­nior lec­tur­er, Uni­ver­si­ty of the West In­dies (UWI), came to this con­clu­sion and is propos­ing that loan fa­cil­i­ties be set up for peo­ple to start new busi­ness­es to help these com­mu­ni­ties.

He took da­ta from the 2010 cen­sus and then looked at all the busi­ness­es in the front­line com­mu­ni­ties in Mara­bel­la, Clax­ton Bay, Gas­par­il­lo and for T&T as a whole and then cal­cu­lat­ed the pop­u­la­tion to busi­ness ra­tio.

“In some com­mu­ni­ties, for ex­am­ple, like Mara­bel­la and Gas­par­il­lo, be­cause they are fence lined, they would take a big hit if it is the Petrotrin re­fin­ery were to close on the as­sump­tion that the pop­u­la­tion to busi­ness ra­tio is in Mara­bel­la and Gas­par­il­lo high­er than any­where else in the coun­try.”

He al­so looked at da­ta of Petrotrin’s em­ploy­ees of where peo­ple are em­ployed and where they live and he then mapped it on to the var­i­ous com­mu­ni­ties.

“What we found is that in some com­mu­ni­ties that are at­tached to some of Petrotrin’s ar­eas you would have a sig­nif­i­cant­ly high­er pro­por­tion of peo­ple work­ing in state-owned en­ter­pris­es.”

He said if he were the Gov­ern­ment he would look at the ex­am­ple of the Ma­yaro Ini­tia­tive for Pri­vate En­ter­prise De­vel­op­ment (MIPED).

“This is a mi­cro en­ter­prise loan that bpTT set in Ma­yaro and it was set up with US$1. It of­fers small loans and, not just that, it al­so of­fered small loans with en­tre­pre­neur­ial train­ing so that a dis­lodge work­er or a com­mu­ni­ty res­i­dent could have got en­tre­pre­neur­ial train­ing and a loan in or­der to run a busi­ness so he or she could gen­er­ate an in­come.”

He sug­gest­ed two MIPED-type loan arrange­ments once the re­fin­ery is closed.

“If we are to go the route of clos­ing the re­fin­ery I think we should con­sid­er, as part of the ex­it pack­age, that Petrotrin form two MIPED-type loans—one in Gas­par­il­lo and one in be­tween Clax­ton Bay and Mt Plai­sance Park—to help stim­u­late eco­nom­ic ac­tiv­i­ty in those com­mu­ni­ties. Of course, there must be well-de­fined cri­te­ria in or­der to ac­cess these loans.”

He al­so rec­om­mend­ed: “We should try to get an eTech Park in Gas­par­il­lo that could ab­sorb and cre­ate back­ward and for­ward link­ages and prob­a­bly on pref­er­en­tial terms for the Petrotrin em­ploy­ees.”

Ho­sein spoke last Fri­day at a sem­i­nar on Petrotrin’s fu­ture host­ed by the Amer­i­can Cham­ber of Com­merce, T&T at the Cipri­ani Col­lege of Labour and Co-op­er­a­tive Stud­ies, Val­sayn.

He gave a his­tor­i­cal overview of T&T’s oil in­dus­try.

In 1974 the com­pa­ny cur­rent­ly called Petrotrin was tak­en over by the gov­ern­ment and re­named as Trin­toc—the Trinidad and To­ba­go Oil Com­pa­ny.

By the mid 1970s there was the oil boom and mon­ey start­ed to flow in­to the econ­o­my.

“A cer­tain Prime Min­is­ter then said that mon­ey is no prob­lem. We took over the as­sets of BP and we took over the as­sets of Shell. Those two in­ter­ven­tions came at the time of the oil boom.”

He then spoke about the first in­car­na­tion of the Petrotrin re­fin­ery.

“The state took over the Petrotrin re­fin­ery at a time when the re­fin­ery it­self was be­com­ing re­dun­dant. In­deed, one for­mer En­er­gy Min­is­ter Bar­ry Barnes not­ed that Tex­a­co had ex­pand­ed the re­fin­ery in Trinidad af­ter they took it over to be all things to all men. “

Fast for­ward to 2018 and Ho­sein said that T&T’s econ­o­my is still in a mess.

“We are not in the same po­si­tion that we were in 1985 but we mirac­u­lous­ly took our time and ex­pe­ri­enced the third oil boom and de­signed strate­gies and for­mu­las to spend most of the mon­ey with­out com­ing out of a re­ces­sion.”

He gave the view that since 2007 the econ­o­my has not grown.

“This econ­o­my is very stag­nant and the prospects for medi­um-term growth is very, very weak.”

Ac­cord­ing to The In­ter­na­tion­al Mon­e­tary Fund (IMF) pro­jec­tion in Ju­ly there will be one per cent growth for T&T.

“Be­fore in the mid-term re­view they said two per cent and the IMF in 2017 had said 1.9 per cent. If we were to ex­trap­o­late this and take 2007 as a base year, in 2020 the econ­o­my is ba­si­cal­ly at the same point so we grew at 0.8 of a per­cent­age point. That is af­ter pro­duc­ing about 3.4 bil­lion bar­rels of oil and gas equiv­a­lent, that has gone for­ev­er. The pe­tro­le­um sec­tor is 10 per cent small­er in size and the non-pe­tro­le­um sec­tor is on­ly about sev­en per cent larg­er,” he said.

He added that the coun­try squan­dered all the in­come it re­ceived from its en­er­gy boom and from 2007 and the coun­try has not pro­gressed.

He point­ed out that in 2016 there were 61 state-owned com­pa­nies and ar­gued that they have now be­come bur­den­some to the econ­o­my.

“In 2007 state-owned en­ter­pris­es’ debt as a per cent of to­tal debt was 38.7 per cent and in 2016 it was 35.7 per cent. It was $7.2 bil­lion in 2007 and $20.5 bil­lion in 2016. I have two young kids and I do not want to be fund­ing any state-owned en­ter­pris­es. In fact I want mon­ey from them. Why should we trans­fer­ring re­sources to state owned en­ter­pris­es? I want com­mer­cial­ly vi­brant state owned en­ter­pris­es us­ing my re­sources to earn me mon­ey to help de­vel­op my coun­try of which I should ben­e­fit in some way. I do not want per­son­al­ly to be sub­si­dis­ing any state-owned en­ter­prise.”

He then went on to give fig­ures on Petrotrin’s con­tri­bu­tion to the econ­o­my.

“In 2009, Petrotrin brought in $17.7 bil­lion in for­eign ex­change and by 2016 it was $3.5 bil­lion. This was a dra­mat­ic and sub­stan­tial de­cline in a short space of time.”

He said that what­ev­er hap­pens at Petrotrin will af­fect the rest of the econ­o­my.

“In fact, the GDP that was fore­cast­ed in the non en­er­gy sec­tor could be mi­nus 1.8 per cent this year, the clo­sure of the re­fin­ery which I am guess­ing con­tributes about $2.4 bil­lion in GDP would lead to an even fur­ther fall in the en­er­gy sec­tor,” he con­clud­ed.