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Friday, July 11, 2025

T&T Chamber renews call for managed float

by

Andrea Perez-Sobers
23 days ago
20250618
The head office of the  T&T Chamber of Industry and Commerce in Westmoorings, Trinidad.

The head office of the T&T Chamber of Industry and Commerce in Westmoorings, Trinidad.

Se­nior Re­porter

an­drea.perez-sobers
@guardian.co.tt

The T&T Cham­ber of In­dus­try and Com­merce says boost­ing en­er­gy rev­enues, stim­u­lat­ing the non-en­er­gy sec­tor and small and medi­um-sized en­ter­pris­es (SMEs) along with deal­ing with the for­eign ex­change crunch are just some of the is­sues the pri­vate sec­tor group would like to see ad­dressed in to­day’s mid-year re­view bud­get.

Re­spond­ing to Guardian Me­dia ques­tions, the T&T Cham­ber said he do­mes­tic econ­o­my still re­lies heav­i­ly on en­er­gy ex­ports with about 80 per cent of ex­port earn­ings com­ing from oil, nat­ur­al gas and petro­chem­i­cals).

It said with glob­al en­er­gy prices down in the last nine months, and do­mes­tic en­er­gy pro­duc­tion de­clin­ing, with an es­ti­mat­ed fis­cal deficit for 2025 of $5.51 bil­lion, it is crit­i­cal to re­vi­talise this sec­tor. The T&T Cham­ber is, there­fore, urg­ing the gov­ern­ment to in­tro­duce pol­i­cy mea­sures that stim­u­late new drilling and ex­plo­ration, there­by in­creas­ing the prospects for high­er en­er­gy rev­enues.

“We al­so call for clear di­rec­tion on geopo­lit­i­cal en­er­gy part­ner­ships. In par­tic­u­lar, the Cham­ber is look­ing for clar­i­ty on how the new ad­min­is­tra­tion will man­age re­la­tions with the Unit­ed States and Venezuela. Clar­i­fy­ing these plans will help re­store in­vestor con­fi­dence in our en­er­gy in­dus­try,” said the group.

The Cham­ber not­ed that new rev­enue streams from the non-en­er­gy sec­tor are es­sen­tial for sus­tain­able growth. Trinidad and To­ba­go has a vi­brant com­mu­ni­ty of Small and Medi­um En­ter­pris­es (SMEs) with tremen­dous po­ten­tial to dri­ve ex­port growth and em­ploy­ment if giv­en the right sup­port, it not­ed.

The Cham­ber said it has been a strong ad­vo­cate for SMEs— demon­strat­ed by its trade mis­sions, ex­ten­sive SME train­ing pro­grammes, and the in­au­gur­al SME Con­fer­ence held in Jan­u­ary 2025—but recog­nis­es that more needs to be done.

It high­light­ed that SMEs con­tin­ue to face hur­dles and in ad­di­tion to fi­nanc­ing and for­eign ex­change, re­quire the gov­ern­ment’s vi­sion and strate­gic ap­proach to en­cour­ag­ing and in­cen­tivis­ing this sec­tor.

“We rec­om­mend that the Mid-Year Bud­get Re­view sup­port SMEs. In ad­di­tion to Ex­im­bank’s spe­cial for­eign ex­change fa­cil­i­ty (cur­rent­ly al­low­ing SMEs up to US$30,000 per month), fo­cus on the ease of do­ing busi­ness and the iden­ti­fi­ca­tion of non-en­er­gy sec­tors that the gov­ern­ment will pri­ori­tise for growth, could en­able SMEs to scale up. A trans­par­ent strat­e­gy with spe­cif­ic sec­tor tar­gets will help SMEs align their ef­forts and en­cour­age pri­vate in­vest­ment in those ar­eas,” the Cham­ber ex­plained.

With re­spect to the for­eign ex­change crunch, the Cham­ber rec­om­mend­ed that a man­aged float of the TT dol­lar is the on­ly im­me­di­ate way to al­le­vi­ate some of the de­mand pres­sure. That in­volves man­ag­ing the move­ment of the ex­change rate so that it be­comes more ex­pen­sive to buy US dol­lars.

The busi­ness group said this mea­sure will re­duce de­mand, stim­u­late lo­cal pro­duc­tion, which be­comes more com­pet­i­tive, and re­duce the im­pe­tus to hoard USD (pend­ing the in­evitable ma­jor de­val­u­a­tion), pos­si­bly in­creas­ing the sup­ply as US-dol­lars re­turn to the coun­try.

“A man­aged float al­so al­lows the free mar­ket to de­ter­mine who gets for­eign ex­change: the most com­pet­i­tive in­dus­tries will con­tin­ue to pur­chase even dur­ing a de­pre­ci­a­tion, while a high­er price will force us to be­come more com­pet­i­tive with lo­cal prod­ucts. Of course, as rec­om­mend­ed by ex­pe­ri­enced econ­o­mists, this must be done in con­junc­tion with pru­dent fis­cal mea­sures such as man­ag­ing ex­pen­di­ture and in­creas­ing in­ter­est rates. Forex should be trad­ed in the for­mal mar­ket and in­to the bank­ing sys­tem,” the Cham­ber de­tailed.

About the crime sit­u­a­tion and if the cham­ber is will­ing to col­lab­o­rate with the Gov­ern­ment on this is­sue, it said, “ The Cham­ber es­tab­lished a ded­i­cat­ed Crime and Jus­tice Com­mit­tee to move from talk to ac­tion. The com­mit­tee’s man­date is to ac­tive­ly en­gage with the Gov­ern­ment, law en­force­ment agen­cies, and oth­er stake­hold­ers to iden­ti­fy the root caus­es of crime and pro­pose con­crete so­lu­tions. We are col­lab­o­rat­ing with the au­thor­i­ties to sup­port much-need­ed re­forms in the crim­i­nal jus­tice sys­tem – for in­stance, im­prove­ments in polic­ing strate­gies, the court process, and re­ha­bil­i­ta­tion pro­grams – be­cause an ef­fec­tive jus­tice sys­tem is cru­cial for de­ter­ring crime and de­liv­er­ing jus­tice swift­ly.”

The busi­ness group in­di­cat­ed that a safe house project was in­clud­ed in its ini­tia­tives.


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