Turn of the T&T private sector

May 22, 2002
By Bukka Rennie

The last column was ended with the following statement: "...Today, given the global considerations, the demand for a Caricom Single Market and Economy (CSME) has once again taken centre-stage. This time however it is not the Jamaican business class, but its Trinidadian and Tobagonian counterpart that has found itself in the driver's seat. Will we in T&T set the wrongs, right? Will we accept the moral responsibility that comes with our present economic dominance in the region?.."

The point that was made was that the Jamaican business elites, then the dominant business sector in the region, were the ones that spearheaded the negative reaction to the federation movement back in the late fifties/early sixties, out of fear that the rest of the region will prove to be a burden to their development and the free movement of labour would destroy Jamaican urban infrastructure.

That negative response, derived out of fear, was supported by Indo-Caribbean people both in Trinidad and Guyana who, given the composition of the population spread, feared that a political federation of the region would result in nothing but their marginalisation; they feared they would be swamped.

Historians need to make it quite clear that the Bustamante/DLP 1958 alliance was all about fear, fear arising, on the one hand, from middle-class myopia and distrust of the masses and, on the other hand, from deep racial insecurity, but fear, nevertheless, that still needs to be addressed.

The result was a major setback for a grassroots, proletarian demand that had been placed on the Caribbean agenda for decades by all the mass movements and progressive forces that emerged at the turn of the last century.

Having attained political independence without federation, islands to the North were left to find their own individual way in a highly competitive world with very volatile mini-economies dependent on either "tourism" or "bananas" or a combination of both, with the "offshore financial services" coming much later in the day as a measure to stem the uncertainties.

Jamaica's larger population and its bauxite reserves placed it initially in a much better position but even that proved temporary as within two decades of Independence the much touted Jamaican economy was in shambles.

To the South the situation was no different, sugar, bananas and tourism to one extent or the other, save and except the occasional added exotic oddity such as nutmeg, other spices and arrowroot.

Only T&T with oil and massive reserves of natural gas and heavy inflows thereby of direct foreign investments, largely from the closer US market, would prove able after Independence to in some ways diversify its economy.

If one were to follow the early Five-Year Development Programmes one would see the coherent logic to what was being attempted. First with the policies of import substitution, and when that did not work as well as expected, the introduction of more direct fiscal and non-fiscal policies by the State geared to extend the local manufacturing sector and stimulate industrial development downstream of the oil and gas sector.

Today T&T has established the most aggressive and competitive manufacturing sector in the English speaking Caribbean. The region is today swamped with T&T made products such as cement, modern household appliances, soaps and detergents, processed tinned and bottled food products, juices and sweet-drink beverages, packaged cereals, etc.

But it is not only about T&T products being dominant but also about T&T manufacturing concerns buying into or buying out similar businesses throughout the region.

In addition, the banks that have became T&T localised after the "1970 Revolution" have all been extending themselves throughout the region and have been acquiring failing financial institutions therein; similarly with the insurance and re-insurance institutions.

The T&T private sector has gained a lot from exports to other parts of the Caricom region.

The point is that there comes a responsibility with this economic dominant position that we hold in the region. When Kenny Anthony, PM of St Lucia, suggested as much to Panday, then PM of T&T, Panday confessed not to comprehend what Kenny Anthony meant. As usual Panday was "playing games".

In the last so-called boom period that T&T experienced, the State was the prime mover and stimulator of the economy. The State was the biggest "capitalist" then, and recognising its obligation to the Caricom region, T&T's assistance to Caricom in the period 1970-1983 amounted to $1.6 billion, according to J O'Neil Lewis in his article titled "Oil boom dollars was not wasted". And most of this $1.6 billion was utilised to finance Caricom members' purchases of oil, fertiliser and asphalt from T&T.

In addition, again according to J O'Neil Lewis, "assistance for emergency relief, for development-oriented projects related to food production and processes, housing, industrial development and basic infrastructure requirements" through the administration of the Caribbean Aid Council was some $27 million.

St Vincent, Antigua, Dominica, Guyana, Jamaica, St Kitts/Nevis, St Lucia, Belize and Barbados all gained from T&T's aid package back then.

Now that the State has divested in many areas and is mainly a facilitator for direct foreign investors and local manufacturers, much will have to be done by private sector initiative.

T&T's private business elites cannot claim to be fearful of being "marginalised" or being "swamped" in context of any Caribbean economic and political federal move when in reality their goods and services have already swamped Caricom.

Do we wish to ever be dubbed the "Ugly Americans" of the Caribbean. We have to give back. To hell with who like who and who don't like who. "Like" has nothing to do with anything. It is all about survival.

The Single Market and Economy is a political/economic imperative that must be accomplished now if the region is to survive after the Free Trade Area of the Americas (FTAA) comes into being in 2005 and after the US/European Community transitional arrangements on "bananas" comes to an end in 2006 and "a tariff-only system takes effect".

And furthermore, given the fact that since the bombing of the World Trade Center American tourism and tourism on a whole to the Caribbean has now dwindled, and given the fact that the Organisation for Economic Growth and Development (OECD) has begun to attempt to sanction and penalise Caribbean offshore financial services, with what will we be left? With what?

Part 1 | Part 2 | Part 3