An­drea Perez-Sobers

Se­nior Re­porter

an­drea.perez-sobers@guardian.co.tt

T&T’s econ­o­my is flash­ing red, and de­ci­sive lead­er­ship is ur­gent­ly need­ed.

That was the mes­sage from EY ex­ec­u­tive chair­man Wade George dur­ing the T&T Man­u­fac­tur­ers’ As­so­ci­a­tion (TTMA) post-bud­get fo­rum at the Hy­att Re­gency on Tues­day.

George paint­ed a sober pic­ture of the coun­try’s fi­nan­cial po­si­tion dur­ing his con­tri­bu­tion, not­ing that the econ­o­my re­mains un­der strain with GDP down 2.1 per cent in the first quar­ter; the All-TT Stock In­dex slip­ping eight per cent for the year, and for­eign re­serves falling to US$4.6 bil­lion in Au­gust, the low­est in decades. The debt-to-GDP ra­tio, he added, has climbed to 84.6 per cent.

“These are not just emp­ty num­bers,” George said. “They are flash­ing red lights. The time for bold, ac­count­able fis­cal lead­er­ship is now.”

Still, he ac­knowl­edged that the gov­ern­ment has tak­en sev­er­al long-de­layed but nec­es­sary steps, de­scrib­ing the 2026 bud­get as “a re­al­is­tic re­sponse to our eco­nom­ic re­al­i­ty.”

Among the ma­jor ini­tia­tives he high­light­ed were Na­tion­al In­sur­ance re­form, call­ing the de­ci­sion to raise con­tri­bu­tion rates and the re­tire­ment age “coura­geous,” and the phas­ing out of the Com­mu­ni­ty-Based En­vi­ron­men­tal Pro­tec­tion and En­hance­ment Pro­gramme Com­pa­ny Ltd (CEPEP) and the Un­em­ploy­ment Re­lief Pro­gramme (URP) in favour of more sus­tain­able em­ploy­ment pro­grammes as ap­pro­pri­ate.

George al­so com­mend­ed the gov­ern­ment’s re­newed fo­cus on in­ter­na­tion­al tax re­form, in­clud­ing long-await­ed trans­fer-pric­ing leg­is­la­tion, and ap­plaud­ed plans for state-backed re­al es­tate in­vest­ment trusts as a way to deep­en cap­i­tal mar­kets and give cit­i­zens greater ac­cess to na­tion­al wealth cre­ation.

At the same time, he ex­pressed con­cern over the as­set levy on banks and in­sur­ance com­pa­nies, de­scrib­ing it as a prac­ti­cal but po­ten­tial­ly coun­ter­pro­duc­tive mea­sure.

“We should be philo­soph­i­cal­ly op­posed to tax­ing as­sets in­stead of in­come,” he ex­plained, not­ing that sim­i­lar poli­cies in oth­er Caribbean economies have proven dif­fi­cult to re­verse.

The ex­ec­u­tive chair­man al­so de­scribed the elec­tric­i­ty sur­charge and the new rental in­come tax as mea­sured fis­cal tools that can help close the deficit if prop­er­ly struc­tured.

On the for­eign ex­change sys­tem, George said main­tain­ing the fixed ex­change rate of­fers short-term sta­bil­i­ty but does not ful­ly ad­dress struc­tur­al im­bal­ances in sup­ply and de­mand. If those con­di­tions per­sist, he said, a grad­ual shift to­wards a more mar­ket-based mech­a­nism could even­tu­al­ly be­come nec­es­sary.

De­scrib­ing the 2026 bud­get as “a bold step to­ward restor­ing eco­nom­ic fair­ness and fis­cal sus­tain­abil­i­ty,” George out­lined that the re­al test will lie in how ef­fec­tive­ly the state can fos­ter growth and re­build con­fi­dence.

He em­pha­sised that sus­tained progress would de­pend on im­prov­ing the busi­ness en­vi­ron­ment, re­mov­ing bu­reau­crat­ic bar­ri­ers, and boost­ing ex­port per­for­mance.

“If we ap­proach this mo­ment with clar­i­ty and courage,” George con­clud­ed, “we won’t just sta­bilise the econ­o­my, we’ll re­de­fine it.”

TTMA wel­comes land al­lo­ca­tion

The TTMA stat­ed that the Gov­ern­ment’s de­ci­sion to al­lo­cate 25 acres of land at the old Ca­roni horse rac­ing track for the cre­ation of a world-class Trade and Con­ven­tion Cen­tre rep­re­sents a sig­nif­i­cant step to­ward po­si­tion­ing Trinidad and To­ba­go as the man­u­fac­tur­ing hub of the Caribbean.

TTMA pres­i­dent Dale Par­son de­scribed the ini­tia­tive as a strong ex­am­ple of pub­lic-pri­vate part­ner­ship, not­ing that col­lab­o­ra­tion be­tween the state and the busi­ness com­mu­ni­ty is vi­tal for na­tion­al de­vel­op­ment.

He al­so high­light­ed sev­er­al bud­get mea­sures that sup­port non-en­er­gy growth, in­clud­ing in­creased fund­ing for Na­tion­al Se­cu­ri­ty, the To­ba­go House of As­sem­bly, and In­fra­struc­ture, with $1.1 bil­lion ear­marked for road works, along with new con­struc­tion in­cen­tives.

Par­son stressed, how­ev­er, that the suc­cess of these plans de­pend on time­ly im­ple­men­ta­tion, say­ing that de­lays could un­der­mine their im­pact. “We can­not af­ford pro­cras­ti­na­tion,” he said. “Man­u­fac­tur­ers know how to make things hap­pen as time is mon­ey.”

He ac­knowl­edged the coun­try’s cur­rent eco­nom­ic head­winds, in­clud­ing neg­a­tive growth in the first quar­ter, and the neg­a­tive out­look by Stan­dard & Poor’s. But he said this pe­ri­od presents an op­por­tu­ni­ty for trans­for­ma­tion through pro­duc­tiv­i­ty and part­ner­ship.

Ac­cord­ing to Par­sons, the man­u­fac­tur­ing sec­tor con­tributes 16.4 per­cent of GDP and em­ploys more than 60,000 peo­ple, sup­port­ed by ini­tia­tives such as the Ex­im­bank Forex Fa­cil­i­ty and Ex­port Boost­er Pro­gramme, which have helped ex­ports grow 18 per cent year-on-year since 2020.