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Sunday, July 13, 2025

Charran: Retailers suffering from slow sales

by

Raphael John Lall
402 days ago
20240606

Raphael John-Lall

Chair­man of the Con­fed­er­a­tion of Re­gion­al Busi­ness Cham­bers, Vivek Char­ran feels dis­ap­point­ed that busi­ness­es across the coun­try are not see­ing the eco­nom­ic growth that T&T’s au­thor­i­ties have boast­ed about.

“A lot of the is­sues that we are fac­ing, whether it has to do with short­age of U.S. dol­lars and so on with re­gard to peo­ple’s dis­pos­able in­come, with re­gard to the lev­els of com­mer­cial ac­tiv­i­ty in the coun­try, we are not see­ing things get­ting bet­ter. For us in the small and medi­um busi­ness sec­tor, we of­ten have to face sta­tis­tics, sta­tis­tics that are print­ed in the news­pa­pers and that we see in pub­li­ca­tions and re­ports. When sta­tis­tics say that we are do­ing well and there is eco­nom­ic growth, we don’t feel it. Down in the trench­es we are try­ing to cre­ate busi­ness and make a dol­lar. We are not feel­ing the im­prove­ment,” he said.

Char­ran spoke at a we­bi­nar on the Medi­um-Term Eco­nom­ic Sit­u­a­tion in T&T host­ed by the Trade and Eco­nom­ics De­part­ment of the Uni­ver­si­ty of the West In­dies (UWI), St. Au­gus­tine.

He said there has been a dras­tic in­crease in the cost of ship­ping com­ing from the Far East as well North Amer­i­ca to T&T and Pana­ma to T&T and this will lead to price in­creas­es lo­cal­ly.

“When we look at this dras­tic rise, it is quite con­sid­er­able. The World Con­tain­er In­dex Price shows that the con­tain­er in­dex in­creased by 16 per cent to US$4,073 per 40 foot con­tain­er. To T&T, from the Port of Shang­hai or In­dia or any­where in the Far East through Pana­ma, it is ac­tu­al­ly US$7,000. Many small and medi­um busi­ness­es im­port goods from Los An­ge­les and New York like cloth­ing, ac­ces­sories, shoes and con­sumer elec­tron­ics. These prices have risen dras­ti­cal­ly from No­vem­ber 2023. What it means for us is that the cost of in­ven­to­ries that are go­ing to be found on the shelves of our stores in T&T is go­ing to in­crease in price con­sid­er­ably com­pared to the price of im­port­ing those same items last year or even last month.”

He added that the coun­try could be see­ing ris­ing in­fla­tion for key con­sumer items such as food, toi­letries and cer­tain phar­ma­ceu­ti­cals.

He al­so said that when hav­ing week­ly con­ver­sa­tions with the lo­cal busi­ness com­mu­ni­ty in the re­tail sec­tor, busi­ness own­ers com­plain that they are not see­ing an in­crease in their sales.

“Every­one has the same prob­lem with the short­age of U.S. dol­lars. What it means is that we are at a crit­i­cal point where tra­di­tion­al re­tail is not as suc­cess­ful as it used to be. Re­tail out­side of the sec­tor of food, phar­ma­ceu­ti­cal, toi­letries or oth­er ne­ces­si­ties are suf­fer­ing great­ly. Peo­ple’s dis­pos­able in­come in T&T is not in­creas­ing. Most peo­ple are con­strained right now with their dis­pos­able in­come,” said Char­ran.

Man­u­fac­tur­ing

Char­ran said small and medi­um sized busi­ness­es must think about di­ver­si­fy­ing in­to oth­er sec­tors like man­u­fac­tur­ing, but point­ed out that chal­lenges stand in their way.

“While many small and medi­um sized busi­ness­es are in­ter­est­ed in di­ver­si­fy­ing in­to man­u­fac­tur­ing…they are helped in a sense by cer­tain Gov­ern­ment grants through ex­porTT. There is the grant fund fa­cil­i­ty that al­lows up to a max­i­mum of $250,000 that halves the cost of pur­chas­ing small ma­chin­ery.

“While it is pos­si­ble to ac­cess some of these grants, one of the largest bar­ri­ers to en­try for the di­ver­si­fi­ca­tion of small and medi­um sized busi­ness­es is that of land. Where will you set up your small fac­to­ry? Where you will put your plant? Where you will do your pro­duc­tion? Com­mer­cial re­al es­tate prices for 5,000 square feet for a place like San Juan or Ch­agua­nas, you are look­ing at $30,000 to $37,000 a month. When you are look­ing at man­u­fac­tur­ing for the lo­cal mar­ket and items that could be com­pet­i­tive­ly priced that can be pur­chased by re­tail busi­ness­es, then it has to be at a price point that al­lows you to sell to the mass­es and it is dif­fi­cult to do that when you have the cost of rent or pur­chas­ing a prop­er­ty.”

He said the eTeck parks are an an­swer to busi­ness peo­ple hav­ing to buy prop­er­ty at ex­or­bi­tant prices, but the prob­lem is that these in­dus­tri­al parks no longer have space.

“One of the things we would like to see is that if new eTeck parks are de­vel­oped, I think it is im­por­tant to have new poli­cies for first-time man­u­fac­tur­ers and to dis­tin­guish be­tween start up fund­ing and con­ces­sions for new en­trants in­to the man­u­fac­tur­ing sec­tor. We have few­er new en­trants in­to the man­u­fac­tur­ing sec­tor than we should.”

Labour

Char­ran al­so said it is im­por­tant for the man­u­fac­tur­ing sec­tor to cre­ate em­ploy­ment, as many per­sons reach out to him en­quir­ing about em­ploy­ment and he al­ways con­tacts some of the coun­try’s man­u­fac­tur­ers ask­ing about job op­por­tu­ni­ties.

“We would like to see an in­crease in em­ploy­ment with­in cer­tain re­gion­al ar­eas. We would like to see an in­crease in em­ploy­ment with­in cer­tain ge­o­graph­ic ar­eas and that is where small and medi­um sized busi­ness­es come in. Now we have a sit­u­a­tion where many of the big­ger com­pa­nies that can do the hir­ing, where there is a ware­house or there are oth­er as­pects of un­skilled labour that peo­ple can get jobs at, they have to trav­el out of the area. And trav­el­ling in T&T is quite ex­pen­sive and many find it is not worth their time.”

En­er­gy

For­mer Min­is­ter of Pub­lic Ad­min­is­tra­tion, Dr Bhoe Tewarie who al­so spoke at the we­bi­nar said the en­tire coun­try looks at non-en­er­gy man­u­fac­tur­ing as the coun­try’s hope to di­ver­si­fy.

He said T&T is not do­ing well in its en­er­gy sec­tor be­cause of the gas pro­duc­tion short­fall.

How­ev­er, he said the Gov­ern­ment has made a good at­tempt to strike deals with Venezuela to make up for this short­fall which should ma­te­ri­alise over the next few years.

“The de­tails of these arrange­ments are not clear, some might say not trans­par­ent. The T&T Gov­ern­ment has al­so done well in the ne­go­ti­a­tions with the US au­thor­i­ties in se­cur­ing the OFAC li­cence that seems to op­er­ate un­der the radar of sanc­tions or new­ly im­posed ones on Venezuela. The medi­um term prospect looks pos­i­tive for T&T in en­er­gy. But all of this de­pends on when we start.”

He said the Gov­ern­ment has been speak­ing about giv­ing life to the non-en­er­gy sec­tor but the forex prob­lems seem to be “es­ca­lat­ing.” Tewarie, said, ow­ev­er there are glimpses of hope.

“How is man­u­fac­tur­ing pro­gress­ing in this re­gard? I think the Ex­im Bank fa­cil­i­ty has made a dif­fer­ence. In 2022 and 2023, US dol­lars repa­tri­at­ed to T&T based on man­u­fac­tur­ing ex­ports ex­ceed­ed forex sold to man­u­fac­tur­ers by over US$100 mil­lion for each of those years. That in­for­ma­tion was giv­en by the chair­man of the Ex­im Bank in a pub­lic fo­rum. This is a good sign that the Ex­im Bank’s ex­e­cu­tion of pol­i­cy is work­ing and man­u­fac­tur­ers are in fact ex­port­ing.”

He said the T&T Man­u­fac­tur­ers’ As­so­ci­a­tion (TTMA) is pur­su­ing a tar­get of dou­bling ex­ports by 2025 us­ing the base year of 2019 and the trade body is op­ti­mistic that this goal will be achieved.

“There has been a sharp rise in chem­i­cal pro­duc­tion of things like de­ter­gent, dish wash­ing liq­uids and hand san­i­tiz­ers which maybe the re­sult of de­mand jumps dur­ing the COVID pan­dem­ic pe­ri­od and new habits formed. Dou­bling 2019 ex­ports by 2025, which is a five-year pe­ri­od, would be a sig­nif­i­cant achieve­ment.”


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