GEISHA KOW­LESSAR-ALON­ZO

Se­nior Re­porter

geisha.kow­lessar@guardian.co.tt

To­ba­go’s con­struc­tion and quar­ry­ing sub-sec­tor record­ed a sharp con­trac­tion in 2025, with ce­ment sales plung­ing by 41.4 per cent year-on-year, sig­nalling a sig­nif­i­cant slow­down in build­ing ac­tiv­i­ty and do­mes­tic in­vest­ment, ac­cord­ing to the Cen­tral Bank’s An­nu­al Eco­nom­ic Sur­vey 2025 re­leased on Tues­day.

The de­cline in ce­ment sales was ac­com­pa­nied by a 13.9 per cent re­duc­tion in ve­hi­cle reg­is­tra­tions, point­ing to weak­ened con­sumer spend­ing on durable goods and in­fra­struc­ture. To­geth­er, these trends un­der­scored broad­er in­dus­tri­al con­trac­tion across the is­land.

At the same time, in­fla­tion­ary pres­sures in­ten­si­fied, in­creas­ing the cost of liv­ing for res­i­dents. Head­line in­fla­tion av­er­aged 2.2 per cent in 2025, up from 1.0 per cent in 2024. This was dri­ven by faster price in­creas­es in both food and core cat­e­gories. Food in­fla­tion rose to 2.5 per cent from 1.3 per cent a year ear­li­er, as sev­er­al es­sen­tial items record­ed no­table price re­ver­sals or ac­cel­er­at­ed in­creas­es.

De­spite these chal­lenges, To­ba­go’s trans­port and lo­gis­tics sec­tors showed re­silience. Car­go ac­tiv­i­ty grew by 2.1 per cent in 2025, sup­port­ed by an in­crease in heavy-du­ty ve­hi­cles trans­port­ing goods and a high­er fre­quen­cy of in­ter-is­land car­go trips.

This mo­men­tum ex­tend­ed to trav­el and tourism. Do­mes­tic trav­el, mea­sured over the first three quar­ters of 2025, rose by 1.5 per cent. Vis­i­tor ar­rivals al­so in­creased mod­est­ly, with Caribbean Air­lines re­port­ing a 1.3 per cent rise in air ar­rivals, while fer­ry ar­rivals grew by 1.9 per cent. These gains high­light­ed the im­por­tance of con­nec­tiv­i­ty and vis­i­tor flows in sus­tain­ing eco­nom­ic ac­tiv­i­ty amid de­clines in heavy in­dus­try.

Labour mar­ket da­ta pre­sent­ed a more com­plex pic­ture. To­ba­go’s un­em­ploy­ment rate im­proved to an av­er­age of 1.2 per cent over the first three quar­ters of 2025, down from 3.1 per cent in the cor­re­spond­ing pe­ri­od of 2024. How­ev­er, this was large­ly due to a con­trac­tion in the labour force rather than ex­pand­ed job cre­ation.

The labour force de­clined to 31.7 thou­sand from 33.4 thou­sand in the pre­vi­ous year, re­flect­ing a drop in both em­ployed and un­em­ployed per­sons. The labour force par­tic­i­pa­tion rate al­so fell to 65.1 per cent from 68.5 per cent, in­di­cat­ing that a grow­ing num­ber of in­di­vid­u­als ex­it­ed the job mar­ket en­tire­ly.

Look­ing ahead, the out­look re­mains mixed. The bank not­ed that car­go ser­vices are ex­pect­ed to im­prove in 2026 with the ac­qui­si­tion of the Blue Wave Har­mo­ny, which re­placed the Cabo Star. The up­grad­ed ves­sel of­fers in­creased car­go and pas­sen­ger ca­pac­i­ty, which could sup­port trade and mo­bil­i­ty.

Ad­di­tion­al­ly, in­creased bud­getary al­lo­ca­tions may strength­en the To­ba­go House of As­sem­bly’s (THA) de­vel­op­ment strat­e­gy, fo­cused on tourism, agri­cul­ture, in­fra­struc­ture, ed­u­ca­tion and dig­i­tal in­no­va­tion.

How­ev­er, the bank cau­tioned that in­fla­tion­ary pres­sures may per­sist in the short to medi­um term. It warned that the re­cent im­po­si­tion of tax­es and added penal­ties could dri­ve up prices for al­co­hol and trans­porta­tion, while on­go­ing cost pres­sures linked to To­ba­go’s re­liance on port fa­cil­i­ties in Trinidad are like­ly to keep prices above the na­tion­al av­er­age.