Raphael John-Lall

Busi­ness lead­ers have all agreed that lo­cal and re­gion­al busi­ness­es must be pre­pared for all pos­si­ble out­comes in the es­ca­lat­ing con­flict be­tween the US and Venezuela.

The Caribbean Cor­po­rate Gov­er­nance In­sti­tute (CC­GI) held a we­bi­nar en­ti­tled “Im­pact of US-Venezuela Ten­sions on the Busi­ness Sec­tor” last Thurs­day.

The dis­cus­sion took place, a day af­ter the US seized an oil tanker off Venezuela’s coast in a dra­mat­ic es­ca­la­tion of ten­sions.

Busi­ness lead­ers who took part in the we­bi­nar were asked to look at dif­fer­ent sce­nar­ios and pos­si­ble out­comes in the con­flict be­tween the US and Venezuela.

CEO of the T&T Risk Man­age­ment In­sti­tute (TTR­MI) and founder of the Caribbean Risk Man­age­ment Acad­e­my (CR­MA), Ken Hack­shaw warned that al­though T&T has drawn clos­er to the US in re­cent times, if there is a mil­i­tary con­flict with Venezuela, the US Gov­ern­ment would put its own in­ter­ests over those of T&T.

“Let’s not be fooled by the close re­la­tion­ship we be­lieve Trinidad now has with the US. If this goes side­ways and the US at­tacks, the US is for the US. I mean, I’m a US cit­i­zen, but I’m al­so a cit­i­zen of the Caribbean. Trump and his folks’ first ob­jec­tive will be US pro­tec­tion.”

He al­so ar­gued that that T&T’s state agen­cies and even pri­vate sec­tor bod­ies are not ful­ly pre­pared in case of a mil­i­tary con­flict.

“I don’t want to use the word un­prece­dent­ed, but for the Caribbean, it is. God for­bid the US at­tacks Venezuela, I’m go­ing to use the words, and this is not fear mon­ger­ing here, lit­er­al­ly, all bets are off as we know busi­ness trans­ac­tions to be. The air­space is go­ing to be locked down. Mar­itime traf­fic is go­ing to be locked down.”

Hack­shaw al­so rem­ined the au­di­ence that Venezuela has made it clear that it will re­tal­i­ate and tar­get T&T in the event of mil­i­tary ac­tion.

“Maduro and his folks in com­ments and the pub­lic have ac­tu­al­ly said that Trinidad is a tar­get if the US at­tacks. Then what? And then the US goes and plants a radar in To­ba­go, prime tar­get. So, in build­ing a sce­nario, plan­ning for pri­vate and al­so for gov­ern­ment, if the first sce­nario ac­cen­tu­ates, ie US at­tacks, there’s so much that will go wrong.”

He spoke about the risks that tourists would be tak­ing in vis­it­ing a po­ten­tial war zone and point­ed out that Ger­many has al­ready is­sued a trav­el alert for T&T.

“Risk is de­fined as the ef­fect of un­cer­tain­ty on achiev­ing ob­jec­tives. And so, if from the tourism as­pect, if folks think that they get on a cruise ship and are go­ing to Caribbean and there’s an at­tack by the US and then mar­itime traf­fic is dis­rupt­ed, I mean, how is that?”

Tourism im­pact

Lor­raine Pouchet, pres­i­dent of the T&T In­com­ing Tour Op­er­a­tors’ As­so­ci­a­tion and in­ter­im chair of the T&T Coali­tion of Tourism As­so­ci­a­tions who al­so spoke said the tourism sec­tor in T&T is al­ready feel­ing the neg­a­tive im­pact of the winds of war.

“This is a very se­ri­ous mat­ter. We need to get to­geth­er, pub­lic pri­vate sec­tor part­ner­ships, look­ing at all the var­i­ous sce­nar­ios, and how can we keep the providers of the prod­uct alive and sus­tained un­til such time as it is okay for busi­ness as usu­al. What we have seen, as far as loss of busi­ness is con­cerned is that many groups have can­celled.”

She added that many peo­ple are “very, very con­cerned” that the re­gion’s air­space could be com­plete­ly closed.

“How are they go­ing to get back out? So, there are many is­sues that sur­round the fact that yes, this thing is tak­ing place. Peo­ple would be con­cerned about their safe­ty.”

She gave oth­er ex­am­ples of how the geopo­lit­i­cal ten­sions are af­fect­ing the lo­cal tourism in­dus­try.

“So, I think, yes, it is af­fect­ing us. As the pres­i­dent of the Coali­tion of the Tourism As­so­ci­a­tions, we have mem­bers from both To­ba­go and Trinidad in that. And we have re­ceived no­tice of can­cel­la­tions of book­ings in the ho­tels, some of the bed and break­fast can­cel­la­tions for groups com­ing in for tours, we have al­so have can­cel­la­tions for groups com­ing off the cruise lines.”

Re­gion­al uni­ty

Mang­ing Di­rec­tor, Ad­vance Com­mer­cial Equip­ment Ltd and CEO, Odin Group of Com­pa­nies, Resh­ma Ad­vani Ro­jas, said T&T sits in a re­gion that de­pends on three frag­ile vari­ables which are con­fi­dence, con­nec­tiv­i­ty and co­op­er­a­tion.

“When ten­sions rise be­tween the Unit­ed States and Venezuela, all three of these things come un­der qui­et pres­sure and that’s where us as boards and pri­vate sec­tor have the re­al work to do. So, let’s say if ten­sions were to hard­en in­to a vis­i­ble con­flict zone in our basin, the head­lines would fo­cus first on se­cu­ri­ty and on en­er­gy but the pri­vate sec­tor would feel a tight­en­ing around the chest when it comes to mon­ey and when it comes to move­ment.”

She al­so said lead­ers would look again at their mod­els, in­vestors would look again at their time­lines, ship­ping, and avi­a­tion and all of them would re­vis­it their ap­proach.

So, in that en­vi­ron­ment, she said the prac­ti­cal re­sponse for boards is to treat ac­cess to cap­i­tal and trade routes as strate­gic as­sets not back­ground ser­vices.

“That means re­view­ing how de­pen­dent the busi­ness is on short-term cred­it that could be repriced very quick­ly and de­lib­er­ate­ly hit­ting some shifts in­to more sta­ble fa­cil­i­ties while the mar­kets are still rel­a­tive­ly calm. It al­so means look­ing at where your goods ac­tu­al­ly trav­el be­cause if you are re­liant on which ports and cer­tain hubs, if you don’t have a re­gion­al al­ter­na­tive, you’re talk­ing about your pre­ferred route be­com­ing more com­plex or more ex­pen­sive.”

She al­so spoke about the im­por­tance of re­gion­al in­te­gra­tion for sit­u­a­tions like this.

“There’s no prac­ti­cal in­te­gra­tion, no shared in­fra­struc­ture, no com­mon dig­i­tal sys­tems for trade, re­gion­al cap­i­tal mar­ket de­vel­op­ment. So, what hap­pens now is we’re pre­pared for the next ex­ter­nal jolt and we don’t feel so frag­ment­ed.”

She added that T&T and the rest of Cari­com are sim­ply too small to re­main iso­lat­ed.

“It means push­ing our boards when they see a geopo­lit­i­cal head­line, not on­ly what does this do to us, but who in the re­gion do we need to be co­or­di­nat­ing with. We are too small and too ex­posed to con­tin­ue op­er­at­ing like iso­lat­ed is­lands and big peo­ple quar­rel. If ten­sions es­ca­late, the com­pa­nies in the coun­tries that have built re­gion­al ob­servers will bend rather than break.”