GEISHA KOW­LESSAR-ALON­ZO

Se­nior Mul­ti­me­dia Jour­nal­ist

geisha.kow­lessar@guardian.co.tt

Trinidad and To­ba­go is brac­ing for a po­ten­tial eco­nom­ic blow as the Unit­ed States ramps up tar­iffs on lo­cal ex­ports to 15 per cent, trig­ger­ing fears of re­duced com­pet­i­tive­ness, shrink­ing for­eign ex­change in­flows, and hits to the man­u­fac­tur­ing and en­er­gy sec­tors.

With the new tar­iff set to take ef­fect on Thurs­day, Gov­ern­ment has rushed to es­tab­lish an in­ter-min­is­te­r­i­al com­mit­tee to chart a re­sponse and way for­ward, as key in­dus­tries such as methanol, am­mo­nia, and per­haps urea face un­cer­tain­ty in the crit­i­cal US mar­ket. They are set to meet on Tues­day.

For­eign Af­fairs Min­is­ter Sean Sobers con­firmed to Guardian Me­dia that Prime Min­is­ter Kam­la Per­sad-Bisses­sar or­dered an ur­gent re­view over the week­end, warn­ing that the in­creased levy—up from 10 per cent in April—could have se­ri­ous short- and long-term con­se­quences for the econ­o­my.

“We pre­pared a re­port, which was ac­tu­al­ly on Thurs­day night. I think that would have been about 1.30 in the morn­ing, we had a call from the Prime Min­is­ter, and she gave in­struc­tions. Based up­on those in­struc­tions, we’ve been work­ing through­out the week­end on fig­ur­ing out our move go­ing for­ward,” Sobers said.

He said the com­mit­tee was ex­pect­ed to com­prise var­i­ous min­istries, in­clud­ing for­eign af­fairs, en­er­gy, trade, fi­nance, and plan­ning.

In one of its ar­ti­cles in April this year, the T&T En­er­gy Cham­ber stat­ed that the US ex­port mar­ket is very im­por­tant to T&T, ac­count­ing for about 30 per cent of T&T’s ex­ports.

It al­so not­ed that over 95 per cent of T&T’s ex­ports to the USA com­prise en­er­gy-re­lat­ed com­modi­ties: crude oil, LNG, methanol, am­mo­nia, fer­tilis­ers (urea and UAN), and iron and steel.

Crude oil, LNG and some fer­tilis­er are ex­empt from the tar­iff, the cham­ber added.

On Thurs­day, US Pres­i­dent Don­ald Trump set a 15 per cent tar­iff on im­ports from T&T un­der a new ex­ec­u­tive or­der ti­tled “Fur­ther Mod­i­fy­ing the Rec­i­p­ro­cal Tar­iff Rates.”

Guyana and Venezuela al­so face a 15 per cent tar­iff.

The an­nounce­ment by the US was part of a sweep­ing up­date to the US tar­iff sched­ule af­fect­ing 69 trad­ing part­ners world­wide.

Sobers al­so shared that Gov­ern­ment has a “mul­ti-pronged ap­proach” that it in­tends to im­ple­ment, in­clud­ing work­ing very close­ly with all af­fect­ed stake­hold­ers to try to bring some res­o­lu­tion.

“Ob­vi­ous­ly there are cer­tain steps that we’d have to go through, and we’d have to deal with COT­ED (Coun­cil for Trade and Eco­nom­ic De­vel­op­ment) as well. There are a num­ber of things that we’ve looked at with­in the last cou­ple of days to try to fig­ure out what are our steps mov­ing for­ward, but that is ba­si­cal­ly in the short term what we in­tend to do.

“Then we do have long-term plans that we in­tend to en­gage in, which you will see be­ing ruled out with­in the very near fu­ture to ad­dress this is­sue,” Sobers added.

The For­eign Af­fairs Min­is­ter, how­ev­er, urged peo­ple not to be alarmed as he re­in­forced that Gov­ern­ment is look­ing at the is­sue.

TTMA: It will hurt busi­ness

Guardian Me­dia al­so reached out to pres­i­dent of the T&T Man­u­fac­tur­ers’ As­so­ci­a­tion (TTMA) Dale Par­son, who said the in­crease would have a neg­a­tive im­pact on busi­ness. 

“This ad­di­tion­al five per cent will have a ter­ri­ble neg­a­tive im­pact on all goods and ser­vices ex­port­ed from Trinidad in­to the Unit­ed States,” he said, not­ing that 39.4 per cent of all T&T’s ex­ports go to the US.

The Cen­tral Sta­tis­ti­cal Of­fice (CSO) not­ed that in 2024, this coun­try’s ex­ports to the US amount­ed to $21.04 bil­lion or US$3.1 bil­lion.

Par­son fur­ther stat­ed that the tar­iff adds an­oth­er stum­bling block to the com­pet­i­tive­ness of T&T’s prod­ucts, par­tic­u­lar­ly lo­cal­ly man­u­fac­tured goods ex­port­ed to Hous­ton, Mi­a­mi, New York, and North Car­oli­na.

“What we see hap­pen­ing is a lot of the di­as­po­ra in these coun­tries de­pend on the lo­cal­ly man­u­fac­tured goods that are ex­port­ed in­to the US, and this will def­i­nite­ly re­duce our lo­cal com­pet­i­tive­ness for sure, not on­ly en­er­gy and chem­i­cal items but al­so lo­cal­ly man­u­fac­tured goods,” Par­son em­pha­sised.

He not­ed that while T&T and Guyana were slapped with a 15 per cent tar­iff, the rest of Cari­com re­mained at the ten per cent mark.

“This is re­al­ly un­for­tu­nate and un­fair, and I hope the Gov­ern­ment can reach out to the US for­eign af­fairs to see if the ad­di­tion­al five per cent can be re­vert­ed,” he said.

For­mer min­is­ter in the Min­istry of Fi­nance Bri­an Man­ning al­so de­scribed the move as trou­bling, say­ing it not on­ly makes T&T’s ex­port­ed goods less com­pet­i­tive in the US mar­ket but al­so lim­its the coun­try’s abil­i­ty to earn for­eign ex­change from in­ter­na­tion­al trade.

“That should be con­cern­ing to every­one be­cause ex­ports are the main way in which we gen­er­ate for­eign ex­change out­side of the en­er­gy sec­tor,” he said.

“So it would neg­a­tive­ly af­fect our di­ver­si­fi­ca­tion ef­forts and al­so the ar­eas of in­dus­try and ex­port, es­pe­cial­ly man­u­fac­tur­ing. I would ask that the Min­is­ter of For­eign Af­fairs be­gin dis­cus­sions and ne­go­ti­a­tions with the US Gov­ern­ment, as sev­er­al oth­er coun­tries have done so, so that we can be re­moved from this tar­iff list. It’s some­thing that’s ex­treme­ly vi­tal to the econ­o­my of Trinidad and To­ba­go,” Man­ning added.

Con­tact­ed for com­ment Trade, In­vest­ment and Tourism Min­is­ter Satyaka­ma “Ka­ma” Ma­haraj reaf­firmed that Gov­ern­ment is cur­rent­ly look­ing in­to the sit­u­a­tion.

James: It could be seen as a form of eco­nom­ic bul­ly­ing

Mean­while, po­lit­i­cal an­a­lyst Dr Win­ford James said the im­po­si­tion of the tar­iff could be seen as a form of “eco­nom­ic bul­ly­ing”.

“It could be seen as they (the US) are per­haps us­ing their eco­nom­ic and per­haps their mil­i­tary pow­er to en­rich their coun­try. You could see that, and this is, of course, a kind of eco­nom­ic bul­ly­ing that ap­pears to be tak­ing place.

“You bul­ly small coun­tries, weak coun­tries, both eco­nom­i­cal­ly and mil­i­tar­i­ly. I may be wrong, but that’s how it seems to me.

“And the ques­tion is, is there a way for coun­tries like Trinidad and To­ba­go to bar­gain, to ne­go­ti­ate? How do we get them to ei­ther re­duce the tar­iff or elim­i­nate the tar­iff? Or is it that they have the pow­er eco­nom­i­cal­ly and mil­i­tar­i­ly, and it’s ei­ther you pay the tar­iffs or you don’t, and you don’t do trade with us—that’s what it’s say­ing?” he asked.

James fur­ther asked whether there is a lim­it for the tar­iff.

“The ques­tion is, what is the lim­it? If Trump de­cid­ed to charge 25 per cent, 30 per cent tar­iffs ... And I’m say­ing there must be a lim­it to that. You can’t keep rais­ing your tar­iffs, and you’re adding tar­iffs to what is al­ready there, to tax­es on goods al­ready there. You can’t keep do­ing that be­cause there comes a point in time when we sim­ply can­not go on that way,” James stat­ed.

An­oth­er ques­tion he said that needs to be asked is whether T&T now needs to look at oth­er mar­kets to sell its goods, such as South Amer­i­ca and Latin Amer­i­ca.