The Trinidad & Tobago Business Guide (TTBG, 2009-10)

a townhouse or apartment for under TT$1.5
million (about US$238,000).
Endorsement from international
agencies ...
The optimists were bolstered by encouraging
reports in late 2008 from Moody’s and the
IMF, both of which saw Trinidad and Tobago
as being well placed to cope with a downturn.
The country has US$11 billion in external
reserves and its Heritage and Stabilisation
Fund, nearly a year’s import cover, and a debtto-GDP
ratio of 1:3. Its sovereign rating for
forex long-term debt with Standard and Poor’s
is A, and with Moody’s Baa1 (March 2009).
The effect was somewhat dampened in
February when the CL Financial bailout rattled
the ratings agencies. But the IMF’s Article
IV executive assessment, released in March,
complimented the government’s spending cuts
and fiscal policy, while warning of the risks
of contagion and the need to cut spending in
the context of lower energy prices. (The IMF
mission and the government disagreed over
exchange rate policy.)
Government spending has been a
topic of popular debate ...
Public concern about the impact of slower
growth, generally tighter conditions and fear
of job losses gradually blunted earlier anxiety
about the high level of government spending,
which Prime Minister Patrick Manning says is
essential to modernise the country and earn
“developed nation status” by 2020. Current
expenditure more than doubled between 2002
and 2007, and capital expenditure multiplied
ten times, from TT$732 million to $7.9
billion.
Some of the results are already visible,
including the International Waterfront
development in Port of Spain (costing TT$2
billion plus), with its 22-storey office blocks,
a 26-storey Hyatt, and a huge amount of
conference space (Port of Spain is being
marketed in 2009 as a conference destination).
The headquarters of the ill-fated Free Trade
Area of the Americas might well have been
sited here. It is now to house Trinidad and
Tobago’s proposed International Financial
Centre, which had attracted interest from the
likes of Lehman Brothers and Merrill Lynch
before their recent tribulations.
Opposite the waterfront, a new “government
campus” is taking shape (TT$1.6 billion) to
house ministries and state agencies; a mile or so
away, on the southern side of the Queen’s Park
Savannah, a massive Performing Arts Academy
(TT$517 million) should be complete this year
or early in 2010. A companion is being built
in San Fernando. A magnificent new residence
“Helped by a booming energy sector, Trinidad and Tobago has achieved an
impressive improvement in economic indicators and has established itself as the
Caribbean’s main industrial and financial center ... The direct impact from the
global financial crisis has been limited, reflecting a liquid and well-capitalized
banking sector that has relied little on foreign borrowing. Resilience also arises
from large international reserves and low debt ratios ... During 2002–07, real GDP
growth averaged 9 percent; per capita income doubled in U.S. dollar terms; both
the unemployment rate and the public debt ratio were halved; and the country has
acquired one of the strongest credit ratings in the region. Improvements in social,
political, and competitiveness indicators, however, have lagged the country’s
economic successes.” IMF Article IV Mission to Trinidad and Tobago, March 2009
“Trinidad and Tobago’s investment grade rating expresses Moody’s positive
view about the ability of Trinidad and Tobago to respond to a downturn in the
commodity cycle without a significant increase in credit risk relative to its rating
peers ... The massive increase in energy output over the past few years should
serve to protect the economy from the ongoing dramatic fall in prices and the
fallout thereof. Trinidad and Tobago is the world’s largest exporter of ammonia and
methanol and supplies the U.S. with almost 60% of its liquefied natural gas needs.
In addition, diversification in the downstream industry has created the possibility
for a higher concentration of local content in the energy sector.” Moody’s Investor
Services, December 2008
for the prime minister, with an adjoining
diplomatic centre, is already complete.
... but investment in transport has
been largely welcomed ...
Investment in transport has been more warmly
received. There are well over half a million cars
on the move in Trinidad, an island barely 70
miles by 70 with only 800 kilometres (500
miles) of roadway; queues of commuters
spend hours every day inching into and out
of the city. Road maintenance continues to
be a problem, and public transport consists of
unpredictable buses and fleets of private mini-
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