Climate change, trade  and business environment

TRADE and Climate Change will be the subject of an in-depth discussion at the regional level as climate change has now been included on the agenda for the Caricom Council for Trade and Economic Development (COTED) 50th Ministerial Meeting to be held in Georgetown, Guyana on 23-24 April 2020.

According to NASA, climate change “is a long-term change in the average weather patterns that have come to define Earth’s local, regional and global climates.” The observed global effects are wide ranging; and in some cases, debilitating to business, international commerce and economic growth.

However, the relationship between trade and climate change flows in two directions. First, international commerce and business operations impact climate change through increases in greenhouse gas emissions. Secondly, rising sea levels, increasing temperatures, storms and hurricanes are destroying the natural resources of economies and affecting their ability to maintain a competitive advantage in producing goods and services.

The Caribbean region has often been identified as a highly disaster-prone area, where hurricanes, floods, volcanic eruptions and earthquakes cause significant deaths and economic losses.

As the intensity and frequency of natural disasters worldwide are rapidly increasing due to climate change, Caribbean economies are encouraged to take a critical look at how they can enhance disaster risk reduction and management (DRRM) systems and policies.

The Caribbean Disaster Emergency Management Agency (CDEMA) has explained “Caribbean Small Island Developing States remain highly vulnerable and exposed and are seemingly increasing exposure through development practices.” It is important to reflect on the fact that Caribbean countries such as Trinidad and Tobago are not only vulnerable to changes in the natural environment.

They also face tremendous macro-economic volatility, are plagued with productivity and competitiveness challenges and characterised by a concentrated export portfolio.

During 19 October 2018, Trinidad and Tobago experienced two days of torrential rainfall, causing a natural disaster which had significant impact on the nation. The government reported that 80 per cent of the country was affected—some 3,500 households and between 100,000 and 120,000 persons by flooding; 21 schools and 550 food premises impacted; 17 farms lost animals; commuters gridlocked, bridges collapsed and businesses and public offices were forced to close or relocate. While the Government of Trinidad and Tobago activated its National Emergency Operations Centre, many of these incidences could have been avoided and/or the impact alleviated with a strong disaster management system.

Disaster Risk Reduction

Management (DRRM) Systems

It is evident that emphasis must be placed on mechanisms to protect human life as well as the business community from the ill effects of climate change.

Therefore, it is imperative to highlight the efficacy and significance of disaster risk management systems in the attempt to assist Caribbean businesses and society in remaining resilient. In doing so, the following assumptions are being made:

— Countries have created a policy space to plan for such unforeseen events

— Mechanisms exist to facilitate and give special consideration to businesses operating in countries such as the Caribbean which face climatic events at an unprecedented rate

A DRRM system calls for a multi-dimensional approach to achieving resilience to climate change. This will involve government, the business community and society at large developing risk management strategies, metrics and targets to deal with natural events that are prominent or will be appearing in the country’s geographic region. DRRM systems decrease the level of vulnerability of the countries which employ them. Therefore, the following is a roadmap for advocating for DRRM in the Caribbean:

I. Rapid Response: It is vital to establish and maintain a rapid response team to be deployed which includes business services such as banks, insurance, transport, logistics, food and pharmaceutical distributors. As such, budgeting for disaster is imperative.

II. Early Warning Systems: Companies that are involved in developing hardware, software and communication portals which can be used in improving procedures and mitigating disaster risks should engage collaboratively.

III. Education: DRRM must be included in the educational curriculum from the primary school level in a more comprehensive manner.

IV. Disaster Insurance: Collaborate on joint Caribbean disaster insurance inclusive of the private sector (Trinidad and Tobago is already a member of the Caribbean Catastrophe Risk Insurance Facility). This will ensure pooling of disaster resources across the region.

V. New Standards: Working alongside the national quality and standards mechanism, in addition to the planning and development agencies, can ensure that building codes are updated and checked regularly.

VI. Join networks such as ARISE: Private sector entities are encouraged to join ARISE in its Mission to create risk-resilient societies by promoting and supporting the integration of disaster risk and disaster preparation into business management strategies and investment decisions.

According to the United Nations’ Office for Disaster Risk Reduction (UNISDR), resilience is the ability of a system, community or society exposed to hazards to resist, absorb, accommodate to and recover from the effects of a hazard in a timely and efficient manner, including through the preservation and restoration of its essential basic structures and functions. Real resilience in Trinidad and Tobago and the Caribbean will require transformation and forward thinking.

The Trinidad and Tobago Chamber of Industry and Commerce thanks Leeooi-Oneika Edmund, Trade Analyst in our Trade and Business Development Unit for this article.

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