An­drea Perez-Sobers

Se­nior Re­porter

an­drea.perez-sobers@guardian.co.tt

Fi­nance Min­is­ter Dav­en­dranath Tan­coo has dis­missed what he de­scribed as fear-mon­ger­ing over the lat­est rat­ings ac­tion from Stan­dard & Poor’s (S&P), say­ing that spread­ing alarm has long been a pas­time of PNM pup­pets and pup­peteers.

On Thurs­day, glob­al rat­ing agency Stan­dard & Poor’s (S&P) re­vised the coun­try’s out­look from sta­ble to neg­a­tive, while af­firm­ing its rat­ings on T&T at ‘BBB-/A-3’ long- and short-term for­eign and lo­cal cur­ren­cy sov­er­eign cred­it rat­ings.

In a news re­lease yes­ter­day, Tan­coo said too many cit­i­zens have been con­di­tioned to ex­pect the worst, when a more bal­anced and ob­jec­tive as­sess­ment of the sit­u­a­tion shows that Trinidad and To­ba­go con­tin­ues to hold firm in­ter­na­tion­al cred­i­bil­i­ty.

He ex­plained that the S&P rat­ing scale is one of the world’s most re­spect­ed sys­tems for eval­u­at­ing the cred­it­wor­thi­ness of gov­ern­ment debt, in­clud­ing bonds and oth­er fi­nan­cial oblig­a­tions. Rat­ings, which range from ‘AAA’ to ‘D,’ help in­vestors de­ter­mine the lev­el of risk in­volved. “S&P is in­ter­na­tion­al­ly re­spect­ed, and any de­ci­sion from the agency comes af­ter rig­or­ous as­sess­ment,” Tan­coo not­ed.

The min­is­ter in­di­cat­ed that for T&T, the out­come was clear and the na­tion’s BBB- rat­ing was up­held, con­firm­ing the coun­try’s con­tin­ued in­vest­ment-grade sta­tus. Ac­cord­ing to the min­is­ter, this is an en­vi­able bench­mark of qual­i­ty and re­li­a­bil­i­ty, sig­nalling that T&T main­tains a strong abil­i­ty to meet its fi­nan­cial com­mit­ments, with low risk of de­fault. This makes the coun­try de­sir­able to in­vestors world­wide.

The on­ly change, he point­ed out, was that the out­look shift­ed from “sta­ble” to “neg­a­tive,” which sig­nals that if cer­tain short­com­ings are not ad­dressed, risks may emerge in the fu­ture.

“Al­though this is a cau­tion­ary flag, it is not a rea­son to pan­ic,” Tan­coo stressed. “The neg­a­tive out­look re­flects da­ta from re­cent years, be­fore this Gov­ern­ment came in­to of­fice. It is proof of why our agen­da to re­store fis­cal dis­ci­pline, di­ver­si­fy the econ­o­my and re­build in­vestor con­fi­dence is both ur­gent and nec­es­sary.”

He point­ed to S&P re­port’s warn­ing: “We could low­er the rat­ings over the next six to 24 months if the gov­ern­ment fails to take time­ly cor­rec­tive steps to strength­en the sus­tain­abil­i­ty of pub­lic fi­nances, en­sure long-term bal­anced eco­nom­ic growth, and main­tain the coun­try’s strong ex­ter­nal pro­file.”

In plain terms, Tan­coo said, had the poli­cies of the pre­vi­ous ad­min­is­tra­tion con­tin­ued, a down­grade would al­ready have been in­evitable.

He added that the up­com­ing 2026 na­tion­al bud­get will be the launch­pad for re­forms and growth ini­tia­tives, in­tro­duc­ing mea­sures to re­in­force fis­cal dis­ci­pline, stim­u­late new sources of rev­enue and set the stage for sus­tain­able long-term pros­per­i­ty.

T&T Cham­ber wants bold re­forms

The Trinidad & To­ba­go Cham­ber of In­dus­try and Com­merce al­so weighed in on the rat­ings ac­tion. In a state­ment, the Cham­ber not­ed that S&P’s de­ci­sion to re­vise the out­look to neg­a­tive, while af­firm­ing the sov­er­eign rat­ing at BBB-, re­flects chal­lenges long felt by its mem­bers. These chal­lenges in­clude overde­pen­dence on the en­er­gy sec­tor, fis­cal im­bal­ances, for­eign ex­change short­ages, and slow progress on di­ver­si­fi­ca­tion.

The Cham­ber high­light­ed S&P’s cau­tion that there is at least a one-in-three chance of a down­grade with­in the next six to 24 months, cit­ing weak­en­ing fis­cal and ex­ter­nal buffers, low long-term growth, and de­clin­ing oil and gas out­put. It warned that a down­grade would raise bor­row­ing costs for both gov­ern­ment and busi­ness, while con­strain­ing ac­cess to in­ter­na­tion­al cap­i­tal mar­kets.

“Based on our in­ter­ac­tions with the Min­is­ter of Plan­ning, Eco­nom­ic Af­fairs and De­vel­op­ment, Sen­a­tor Kennedy Swarats­ingh, and the Min­is­ter of Trade, In­dus­try and Tourism, Satyaka­ma Ma­haraj, we are hope­ful that the strate­gies be­ing de­vel­oped will ad­dress these chal­lenges,” the Cham­ber said. It added that with the na­tion­al bud­get due in Oc­to­ber, it ex­pects bold re­forms to strength­en com­pet­i­tive­ness, at­tract for­eign di­rect in­vest­ment and build re­silience.

The Cham­ber al­so an­nounced that its post-Bud­get fo­rum, themed “Un­lock­ing Trinidad and To­ba­go’s Next Gen­er­a­tion Econ­o­my,” will pro­vide in­sights and so­lu­tions from busi­ness lead­ers to sup­port gov­ern­ment pol­i­cy.

“We will con­tin­ue to col­lab­o­rate with the Gov­ern­ment on be­half of the busi­ness sec­tor and all cit­i­zens to cre­ate an en­vi­ron­ment that fos­ters in­no­va­tion, re­silience, and com­pet­i­tive­ness,” it said.