COVID-19 has been perceived as a global negative shock hurting all sectors and markets. However, many companies are adjusting and developing innovative strategies to survive and grow their businesses. Some of the changes in the international environment have opened the way to new opportunities and improved access in Trinidad and Tobago’s (T&T) traditional export markets for both our goods manufacturers and service providers.
The food and beverage, printing and packaging and miscellaneous manufacturing sectors have been identified as having significant export potential. Within the realm of services, the ICT, financial services, tourism, creative industries (e.g. fashion, music, and film), energy and maritime services all have been identified for development and diversification of T&T’s productive base.
Caricom, Latin America, the United States and the European Union collectively accounted for over 80 per cent of T&T’s exports in 2019. Given the economic importance of these trading partners, exporters should watch for new opportunities there. Experienced exporters will also note the changing dynamics in existing markets that will affect their trade in the future.
Although post-pandemic growth is expected to be slow at first, Caribbean economies will remain at the core of our cross-border trade. Guyana, Jamaica and Barbados stand out as the prominent markets for T&T’s exports. As a result of improvements made to its investment infrastructure, Jamaica established itself in 2017 as the top economy in Caricom for ease of doing business.
It also ranked as the fifth easiest place to start a business by the World Bank Group in 2018 and holds great potential for local businesses seeking to expand their product and service outreach. In the case of Guyana, the estimated 4 billion barrels of oil found offshore since 2015 could transform the economy beyond the projected growth rate of 3.3 per cent. Guyana is expected to generate increased demand for business support services even during the pandemic in order to sustain the increase in market activity, particularly in the areas of ICT and business consultancy. Service providers are able to take advantage of remote working arrangements in order to benefit from these opportunities. Barbados is a main importer of our food and beverage manufactured goods. Given the international supply and shipment challenges with goods coming from Asia, T&T is better positioned geographically to fulfil market demands currently for these goods.
Latin America is seen as the new horizon for global trade. T&T’s exporters can already benefit from preferential trading arrangements with Columbia, Venezuela, Costa Rica, Cuba, the Dominican Republic and Panama.
The Dominican Republic has one of the highest projected growth rates in Latin America and the Caribbean. According to the updated IMF forecasts from October 2020, due to the outbreak of Covid-19, GDP growth fell to -6 per cent in 2020 but is expected to pick up to 4 per cent in 2021 and 5 per cent in 2022, subject to the post-pandemic global economic recovery. There is much untapped potential and existing demand for manufactured products, particularly inputs for value-added production to re-export.
In Central America, the market access advantage provided by the TT-Panama Partial Scope Trade Agreement, coupled with the improvements made to the Panama Canal can give the T&T manufacturers increased access to greater volumes of cheaper inputs from global markets for their value-added manufactured goods.
Negotiations and trade talks between T&T and Chile have occurred between October 2019 and April 2020 and the Agreement is carded to be signed by July 2021. Businesses which are currently engaged in trade with Chile have expressed their concerns and challenges with the cost of shipping and transshipment routes available to facilitate imports and exports between the countries. The T&T Chamber advocates for the establishment of a trade facilitation work plan that can be implemented once the agreement comes into effect. This is a solution geared towards the reduction in shipment challenges which will stimulate interest amongst exporters and ultimately heighten trade with Chile.
Services providers may be pleased to know that the region is considering a Caricom-Colombia Services Agreement as the Parties have recognised that it will be opportune and necessary to develop cooperation in this sector. Notably, the Trinidad and Tobago’s Trade Policy 2019-2023 speaks to actively pursuing new and upgrading existing bilateral agreements, to provide access to more diversified markets for the country’s exports of services.
The governments of T&T and Curaçao have begun discussions for a preferential trade agreement and exporters should look at this country as a prospective destination for both goods and services. Caribbean Export has alluded to this Dutch-Caribbean country as a bit of Holland in the middle of the Caribbean with modern and advanced infrastructure, transportation, and an extensive telecommunications network. The country has one of the world’s largest natural harbours, making it a centre for container ships and is known for financial and business processing operations.
US, post-Brexit EU and UK
For the past 20 years, Trinidad and Tobago’s exporters have enjoyed duty-free access to the US through the Caribbean Basin Trade Partnership Act (CBTPA). The World Trade Organization (WTO) approved the request by the US for an extension of the waiver for the trade preferences to certain Caribbean countries pursuant to the Caribbean Basin Initiative (CBI) until September 30, 2025. The services sector has been entrenched in the discussion as Caricom has committed to strengthening Intellectual Property and Copyright Enforcement in the Region; and will be initiating a work programme for IP Stakeholders.
On the other side of the Atlantic, the infamous Brexit decision aroused concerns as to how T&T—and by extension CARIFORUM—will continue to benefit from preferential access for its exports. The United Kingdom is a major trading partner for T&T, so it was imperative for us to sign on to the CARIFORUM-UK Economic Partnership Agreement (EPA) which now provides preferential market access for both goods and services from this country to the UK.
Having an idea of where the global opportunities exist is just the beginning. Making the best decision depends on a sound market penetration strategy that involves continuous market intelligence gathering. It also requires an understanding of your product’s uniqueness and how it meets existing or potential demand in your market of interest.
Companies may engage in exporTT’s export-booster programme and Virtual trade missions as trade missions and trade expositions offer perfect opportunities for learning about developments in new and existing markets. In addition, companies which are interested in securing preferential access for their products—whether in a new or existing market, should continuously engage with the T&T Chamber as we participate in stakeholder consultation with the Ministry of Trade and Industry on this matter.
This article was updated by Leeooi-Oneika Howard, Trade Analyst in the Trade and Business Development Unit from an original article developed for the Trinidad and Tobago Chamber of Industry and Commerce titled “Know Your Export Markets” by Lisa Douglas and published in Contact Magazine Vol 18, No. 3.
Last week’s Chamber column, was written in-house by the T&T Chamber and not by John Denton, whose photograph also identified him as the chair of Caricham. Mr Denton is actually the Secretary General of the International Chamber of Commerce (ICC). The Express apologises for the errors.