Managing Director of Ansa Merchant Bank Gregory Hill has told local businessmen they can emerge from the current economic slump by making savvy decisions that will yield handsome rewards in the not-so-distant future.
In his contribution to a recent AmChamTT Economic Outlook seminar, Hill said he is confident bold investments will yield benefits.
He said there had been a marked improvement in T&T's governance and regulatory environment since the 2008/2009 Clico and HCU debacles. In addition, T&T is home to some of the largest and best private sector companies.
"These companies have strong boards of directors, diligent management and active shareholders. The regulatory environment in the country has also improved significantly, with the introduction of the Financial Institutions Act 2008, for example, while the regulatory supervision framework has also been enhanced," he said.
Hill said while the country has had its fair share of challenges, it is an open and free society where daily discourse and an exchange of ideas takes place. He urged business leaders to be willing to step in and purchase assets that were available at "fire sale" prices.
"As fiduciaries for our shareholders, we have a duty to timely retool our companies to prepare them for the future. The present slowdown gives us the perfect opportunity to buy that piece of equipment that we ought to have bought a couple years ago, but didn't, because production could barely keep up with demand. Think about the ways that you can re-engineer your business today, to prepare for better times tomorrow," he said.
Noting the stable political environment, reasonably high foreign exchange reserves and a banking sector that retained strong capital buffers, Hill said local firms have a lot of spare capital that is idle because investors are uncertain about the future while firms in other parts of the world haver a high demand for their products and are growing at a phenomenal rate but are restricted by the lack of available capital to expand.
"Capital, in many ways, is analogous to water and should flow from areas of high concentration to low concentration, where more can benefit from its abundance. We have to consider partnerships, joint-ventures and M&A activity to grow inorganically, where we cannot grow organically," Hill said.