De­spite last week’s suc­cess­ful is­suance of the US$800 mil­lion sov­er­eign bond in the US mar­ket, there is con­tin­ued con­cern about the man­age­ment of T&T’s debt.

The Min­istry of Fi­nance an­nounced via press re­lease last week that the bond, which it re­port­ed was over­sub­scribed by ap­prox­i­mate­ly 400 per cent, re­flect­ed re­newed in­ter­na­tion­al con­fi­dence and a strength­ened fis­cal po­si­tion for T&T.

The re­lease stat­ed the trans­ac­tion pro­vid­ed the Gov­ern­ment with a more re­silient long-term fi­nanc­ing strat­e­gy through sev­er­al key out­comes, such as re­fi­nanc­ing old­er debt.

The Min­istry said the new bond, is­sued at 6.20 per cent, will be used to re­pay 4.50 per cent notes due in Au­gust 2026 and sup­port gen­er­al bud­getary pur­pos­es.

The an­nounce­ment of the bond’s suc­cess came days be­fore a re­view of the Her­itage and Sta­bil­i­sa­tion Fund’s Quar­ter­ly In­vest­ment Re­port: Oc­to­ber–De­cem­ber 2025 re­vealed the T&T gov­ern­ment with­drew ap­prox­i­mate­ly US$510.8 mil­lion from the Her­itage and Sta­bil­i­sa­tion Fund (HSF) dur­ing the fi­nal six months of 2025. The HSF re­port­ed de­tailed two spe­cif­ic pay­ments: a US$260.8 mil­lion with­draw­al in the Sep­tem­ber quar­ter and a US$250 mil­lion trans­fer in the De­cem­ber quar­ter.

The re­port al­so not­ed the sov­er­eign wealth fund gen­er­al­ly out­per­formed its bench­marks due to strong glob­al eq­ui­ty mar­kets, though its to­tal net as­set val­ue fluc­tu­at­ed be­tween US$6.25 bil­lion and US$6.34 bil­lion.

The Busi­ness Guardian reached out to the Min­is­ter of Fi­nance, Dav­en­dranath Tan­coo, seek­ing an in­ter­view to dis­cuss the bond and the coun­try’s eco­nom­ic po­si­tion, but he did not re­spond to the re­quest.

A sim­i­lar re­quest was made of the Min­is­ter of Plan­ning, Eco­nom­ic Af­fairs and De­vel­op­ment and Min­is­ter in the Min­istry of Fi­nance, Dr Kennedy Swarats­ingh, but he de­ferred any dis­cus­sion on those mat­ters to the Fi­nance Min­is­ter.

How­ev­er op­po­si­tion MP and For­mer Min­is­ter in the Min­istry of Fi­nance Bri­an Man­ning said de­spite the gov­ern­ment’s boast of the bond’s suc­cess, “In broad terms, T&T in mid 2026 is in a frag­ile eco­nom­ic state.”

In re­sponse to ques­tions from the Busi­ness Guardian, Man­ning not­ed the growth pro­jec­tions were low­er and for­eign ex­change con­cerns re­mained along with the coun­try’s grow­ing debt as well as what ad­just­ments could be made to ad­dress it.

“The re­cent news of hav­ing to bor­row al­most US$2 bil­lion ex­ter­nal­ly on the back of a with­draw­al of more than US$500 from the HSF gives the im­pres­sion that this Gov­ern­ment is pad­dling for its life while en­ter­ing deep­er and deep­er un­chart­ed eco­nom­ic wa­ters. With a peren­ni­al fis­cal deficit, the is­sue is less “what to slash” and more “what to struc­tural­ly re­form,”said Man­ning, the MP for San Fer­nan­do East.

“There is too much of a de­pen­dence on the en­er­gy sec­tor, but the Gov­ern­ment is at the same time star­tling the rest of the econ­o­my with these in­cred­i­ble tax­es and fines,” he said.

“It makes no sense and cer­tain­ly won’t grow the econ­o­my,” he added, ques­tion­ing whether the bond was as much of a suc­cess as the Gov­ern­ment sug­gest­ed, giv­en that it may add to the coun­try’s debt pro­file in the long run.

“Since on­ly US$1 bil­lion was need­ed to re­fi­nance, the ex­tra US$800 mil­lion is new ex­ter­nal debt, used for “gen­er­al bud­getary pur­pos­es”—ie, to fund on­go­ing deficits rather than trans­for­ma­tive in­vest­ment,” he said.

“It is be­com­ing more and more dif­fi­cult for the Gov­ern­ment to bor­row from lo­cal banks be­cause many of them are ap­proach­ing their debt con­cen­tra­tion lim­its with Gov­ern­ment debt. This means they are forced to bor­row ex­ter­nal­ly, which is more ex­pen­sive and must be re­paid in USD.”

Man­ning added that while some may point to sev­er­al ma­jor economies’ op­er­at­ing debt to GDP ra­tios of more than 85 per cent, it was im­por­tant to as­sess how those coun­tries could man­age those debts in­ter­nal­ly, where­as T&T is grow­ing in­creas­ing­ly re­liant on the ex­ter­nal cap­i­tal mar­kets.

“Coun­tries like the US, Japan, and parts of Eu­rope op­er­ate with debt-to-GDP ra­tios well above 85 per cent, some­times over 100 per cent. They can do this be­cause they: Bor­row large­ly in their own cur­ren­cy; Have deep do­mes­tic cap­i­tal mar­kets; Are “safe as­sets” for glob­al in­vestors,” said Man­ning.

He said that for coun­tries like T&T, a high debt-to-GDP is more dan­ger­ous be­cause: A sig­nif­i­cant share is in for­eign cur­ren­cy; for­eign ex­change earn­ings de­pend heav­i­ly on a sin­gle sec­tor (en­er­gy); Shocks to en­er­gy prices or pro­duc­tion can quick­ly un­der­mine debt sus­tain­abil­i­ty. “

“So, the ques­tion isn’t ‘is 85 per cent okay in the­o­ry?’ but is 85 per cent sus­tain­able for a small, en­er­gy de­pen­dent, im­port-re­liant econ­o­my with per­sis­tent deficits and for­eign ex­change con­straints? The tol­er­ance lev­el is low­er. If fis­cal con­sol­i­da­tion, en­er­gy re­vi­tal­i­sa­tion, and di­ver­si­fi­ca­tion are pur­sued se­ri­ous­ly, the coun­try can step back to safer eco­nom­ic ground. If deficits con­tin­ue to be fi­nanced by ever-more-ex­pen­sive ex­ter­nal bor­row­ing, T&T will be in for a rough ride,” the op­po­si­tion MP said.

Econ­o­mist Dr Ronald Ramkissoon said de­spite the promis­ing an­nounce­ments, “the T&T econ­o­my con­tin­ues to be se­vere­ly chal­lenged with a con­fus­ing mix of mar­ket sig­nals that are not help­ing the sit­u­a­tion.”

He not­ed that sev­er­al bil­lion dol­lars would be added to the TT’s $150 bil­lion debt, which ex­ist­ed at the end of fis­cal 2025.

Ramkiss­son con­firmed the ex­ter­nal debt ser­vice ra­tio will cross the 8.2 per cent reg­is­tered in Sep­tem­ber 2025 from a low 3.3 per cent reg­is­tered in Sep­tem­ber 2021.

Ramkissoon said, giv­en the coun­try’s peren­ni­al fis­cal deficit, “a clos­er look at all ex­pen­di­tures is re­quired.”

He said, “Some sub­si­dies are a good place to start, es­pe­cial­ly where they are ex­treme­ly cost­ly and where the well-off might be the ma­jor ben­e­fi­cia­ries. Al­so, the state en­ter­pris­es sec­tor needs to be looked at with a view to prun­ing or dis­man­tling al­to­geth­er. Pol­i­cy mak­ers must take note that ex­pen­di­ture switch­ing is not the same as cost cut­ting, and the out­come might be worse than be­fore.”

Like Man­ning, Ramkissoon not­ed the 85 per cent debt to GDP ra­tio was man­age­able based on con­text.

He said, “Yes in­deed. How­ev­er, we must re­mem­ber that each coun­try is unique: large coun­tries and small ones ; min­er­al ex­porters and non-min­er­al ex­porters. The high­er the debt to GDP ra­tio, the less room for sup­port in case of nat­ur­al or man-made dis­as­ters.”

With this con­cern in mind, Ramkissoon said the coun­try must have a clear strat­e­gy for debt man­age­ment, which must in­clude sev­er­al sce­nar­ios in this high­ly un­cer­tain en­vi­ron­ment.

Op­po­si­tion sen­a­tor and for­mer Fi­nance Min­is­ter Vish­nu Dhan­paul was al­so asked for his per­spec­tive, but stat­ed he was in the process of trav­el­ling and in­stead point­ed the Busi­ness Guardian to the Cen­tral Bank’s da­ta pack for June, which was re­leased last week.

An­oth­er econ­o­mist, Mar­la Dukha­ran, al­so could not give di­rect re­spons­es to the Busi­ness Guardian’s ques­tion due to time zone dif­fer­ences where she was lo­cat­ed in South East Asia, but point­ed out she had re­cent­ly writ­ten about T&T’s debt sit­u­a­tion.

She stat­ed then, ‘Note that Gov­ern­ment debt out­stand­ing in­creased by 2.5 per cent y/y in Q1 2026; ex­ter­nal debt in­creased 5.3 per cent, and the debt/GDP ra­tio rose 2.1 per­cent­age points to the high­est lev­el on record of 84.9 per cent - as out­lined in the June edi­tion of my Month­ly Caribbean Eco­nom­ic Re­port. This be­ing the high­est debt lev­el ever tells us that we are in a pre­car­i­ous po­si­tion.”

She, like Man­ning, al­so not­ed the for­eign ex­change dilem­ma, which would cre­ate a com­pli­ca­tion for the coun­try’s debt man­age­ment.

She said, “Fur­ther­more, the lev­el of for­eign ex­change re­serves in T&T is more than 100 per cent bor­rowed and had to be re­paid with in­ter­est - so they are not re­al­ly re­serves. They are 100 per cent debt. This tells you again that we are bor­row­ing way too much and bor­row­ing in for­eign cur­ren­cy, which is even more risky as you can’t print US dol­lars: you have to earn or bor­row it. “

The Bar­ba­dos-based econ­o­mist added that this was fur­ther com­pli­cat­ed by the ex­change rate pres­sures on T&T’s cur­ren­cy, which al­so push up the cost of re­pay­ment.

She added, “None of this is pos­i­tive or should give any com­fort. Note al­so that the Gov­ern­ment of Trinidad and To­ba­go records a pri­ma­ry fis­cal deficit. What does that mean? It means that be­fore it pays its in­ter­est on the debt it al­ready holds, the gov­ern­ment is in the red, such that it must bor­row to pay the in­ter­est on its ex­ist­ing debt. That, com­bined with the high­est lev­el of debt ever record­ed, com­bined with for­eign ex­change re­serves that are more than 100 per cent bor­rowed, com­bined with high­er lev­els of spend­ing as you out­lined, sug­gests that we are on the road to­wards sov­er­eign debt de­fault/re­struc­ture, and we are gain­ing mo­men­tum.”

Econ­o­mist Dr Dave Seer­at­tan, when con­tact­ed, said he would not re­peat an­swers he has al­ready giv­en as he told the Busi­ness Guardian that he had con­sis­tent­ly com­ment­ed on the coun­try's de­pen­dence on bor­row­ing.

“Un­til we get the fis­cal deficit un­der con­trol, this thing is go­ing to hap­pen,” Seer­at­tan said.