Government should reassess Tobago’s airport expansion project now budgeted to cost $1.3 billion and which according to Mark Edghill, president of the T&T Coalition of Services Industries (TTCSI), will not derive any immediate benefit from the tourism sector.
Speaking yesterday at the organisation’s annual pre-budget webinar titled “Strategies for Economic Transformation: Services Sector,” Edghill explained that there is insufficient air traffic and visitor numbers to warrant the expenditure at this time.
He said the existing airport capacity is more than sufficient for the level of tourism and visitors to the island, adding that these funds should be allocated to developing tourism and tourist attractions, quality accommodations, world-class facilities and national hospitality training to build Tobago’s appeal and a portfolio of destination incentives and attractions to raise the profile and steadily increase the volume of visitors.
Edghill further suggested that when a threshold is reached or a trajectory accurately estimated, Government should then move forward with the airport expansion to be ready in pace with the growing visitor demands.
In outlining other recommendations Edghill also advised that the real estate sector be identified and reclassified as an essential service.
“Real estate business, being assessed as an extremely low-risk service, should not be prohibited for providing accommodations to citizens,” Edghill explained.
Noting that businesses are also impacted by national emergencies and require assistance to relocate or surrender properties, Edghill said the downstream impact of real estate is also one that provides economic stimulus, through mortgages, investments and all the individual service providers such as plumbers, contractors, masons, painters, electricians, tilers, hardware and building materials suppliers etc, that supports and maintains consumer spending and confidence.
Other recommendations Edghill said is maximising the yacht services industry which should be sufficiently prepared and facilitated to maximize its potential not only in terms of attraction but also skilled labour and available facilities.
According to Edghill, with past revenues of around US$56 million from the sector, it can therefore, be a substantial contributor to forex.
He further suggested there be regularisation of land tenure of 75 per cent of pan yards on State lands which could amount to the “greatest migration of wealth into the hands of the creative sector in the history of our country.”
Vashti Guyadeen, CEO of the TTCSI, said the services sector is the largest in T&T’s economy contributing a combined total of 72 per cent or $115 billion to GDP fiscal year 2017, employing over 85 per cent of the labour force.
She added that in 2018, the sector contributed an estimated 58 per cent to GDP, followed by 53 per cent in 2019.
However, according to Guyadeen despite its success the sector accounts for less than 10 per cent of export earnings.
“The services sector, therefore, has significant scope for growth of export generation with recent developments in ICT making it much easier to digitally execute services for clients anywhere in the world,” she maintained.
The TTCSI also recommends the development of an Export Booster Programme as well as expediting VAT refunds and implement a deductible payment structure so that VAT owed to businesses can be offset against new payable VAT submissions.
Penalties and interest should also be applicable both ways, it added.
Further, the organisation suggested that forex be made available to all small businesses by establishing a system, whereby, there are portions of forex allocated or reserved for MSMEs in various sectors that meet the criteria.
“The influence of big business consistently facilitates that priority is given to them and this impacts the availability of forex for all others,” it added.