Glob­al­i­sa­tion is in full re­treat, mak­ing the geopo­lit­i­cal and eco­nom­ic space more com­plex every day. In the emerg­ing mul­ti­po­lar world, the Unit­ed States is us­ing its eco­nom­ic pow­er to re­verse the trade link­ages that fa­cil­i­tat­ed eco­nom­ic in­ter­de­pen­dence be­tween coun­tries and made faster world eco­nom­ic growth pos­si­ble.

In this new re­al­i­ty, puni­tive tar­iffs (50 per cent) are levied on In­dia’s ex­ports to the USA as long as it con­tin­ues to buy Russ­ian oil. Sim­i­lar­ly, un­der Pres­i­dent Don­ald Trump, the US Com­merce De­part­ment re­voked ex­port con­trol waivers for Ko­re­an firms, which al­lowed them to send US-ori­gin semi­con­duc­tor equip­ment to their fac­to­ries in Chi­na with­out US ex­port li­cences. The same is true for Japan. Al­so, both coun­tries were “en­cour­aged” to pledge sig­nif­i­cant in­vest­ments in the US to ob­tain low­er tar­iffs on their US ex­ports.

Sim­i­lar­ly, Trinidad and To­ba­go is not “free” to de­vel­op the en­er­gy li­cence it ne­go­ti­at­ed with Venezuela in De­cem­ber 2023 with­out an OFAC li­cence from the US State De­part­ment. Re­cent de­vel­op­ments sug­gest that the new “six-month” OFAC li­cence is de­signed to fa­cil­i­tate a rene­go­ti­a­tion of the 2023 agree­ment with Venezuela to make that agree­ment more palat­able to US in­ter­ests.

Gas and oil pro­duc­tion are in sec­u­lar de­cline. With­out sig­nif­i­cant dis­cov­er­ies, the long-term sur­vival of the en­er­gy sec­tor—LNG and petro­chem­i­cals in par­tic­u­lar—is de­bat­able. The known de­vel­opable fields are the cross-bor­der fields. Man­a­tee is ex­pect­ed to come on stream by the sec­ond quar­ter of 2027. This is the sce­nario in which the GORTT must craft eco­nom­ic pol­i­cy for the fore­see­able fu­ture. To as­sume that a new or dif­fer­ent US pres­i­dent would bring a pol­i­cy change would be fool­hardy. The Oba­ma ad­min­is­tra­tion sig­nalled a “Piv­ot to Asia” as a gam­bit to blunt Chi­na’s rise to world pow­er sta­tus.

Trump 1.0 ini­ti­at­ed a tar­iff war with Chi­na, which Biden con­tin­ued. Trump 2.0 in­ten­si­fied the trade war with Chi­na. A new pres­i­dent may soft­en the US ap­proach but is un­like­ly to change the strate­gic di­rec­tion. The same ap­plies to the US ap­proach to Venezuela.

These de­vel­op­ments have broad­er im­pli­ca­tions for T&T’s strate­gic trade poli­cies. Al­though the en­er­gy sec­tor is not a large em­ploy­er, its con­tri­bu­tion to the econ­o­my has been sig­nif­i­cant, ac­count­ing for most of this coun­try’s for­eign ex­change earn­ings (35–40 per cent). Tax­a­tion and roy­al­ty rev­enue from the oil and gas sec­tor and its de­riv­a­tives have pro­vid­ed a sig­nif­i­cant share of tax rev­enues. The de­cline in ex­port prices in 2014 trig­gered a de­pres­sion that last­ed un­til 2022. The re­vival was short-lived due to en­er­gy sec­tor price in­creas­es caused by the war in Ukraine. The Cen­tral Bank re­port in June 2025 sig­nals that we have re­turned to a neg­a­tive growth path.

Oil and gas prices are soft, as are petro­chem­i­cal prices. The new US 15 per cent tar­iffs will af­fect the com­pet­i­tive­ness of the petro­chem­i­cal com­pa­nies’ ex­ports to the US. Tax rev­enues from this sec­tor are like­ly to de­cline fur­ther. Many pub­lic sec­tor wage ne­go­ti­a­tions are not yet up to date. When these are con­clud­ed, they will add to ex­pen­di­ture growth. In 2025, the deficit is ex­pect­ed to be close to $10 bil­lion. With de­clin­ing tax rev­enues in 2026 or an in­crease in ex­pen­di­ture, the deficit will ex­ceed $10 bil­lion.

There is al­so a tick­ing time bomb that the Gov­ern­ment has not dis­closed. GORTT pen­sion fund oblig­a­tions are chal­lenged by the same de­mo­graph­ic trends that com­pro­mise the fi­nan­cial vi­a­bil­i­ty of the Na­tion­al In­sur­ance Fund. These pub­lic ser­vice pen­sion oblig­a­tions are a di­rect charge to the con­sol­i­dat­ed fund and re­quire no con­tri­bu­tion from pub­lic ser­vants. In 2009, these un­fund­ed oblig­a­tions amount­ed to $30 bil­lion. Af­ter 16 years, these un­fund­ed oblig­a­tions have in­creased sig­nif­i­cant­ly, as has the Se­nior Cit­i­zens Grant. As ex­pen­di­ture on these oblig­a­tions bal­loons, few­er re­sources are avail­able to be di­rect­ed to oth­er pri­or­i­ties.

Em­ploy­ees are more com­mit­ted to their tasks when their em­ploy­er meets agreed com­mit­ments, pro­vides a re­li­able health care plan, and ful­fils pen­sion oblig­a­tions. Health in­sur­ance claims for gov­ern­ment em­ploy­ees suf­fer long de­lays be­cause gov­ern­ment em­ploy­ee health care plans are in deficit due to non-pay­ment of em­ploy­er con­tri­bu­tions. The same is true of gov­ern­ment pay­ments to T&TEC and WASA for ser­vices ren­dered. The point is that the GORTT must ful­fil its le­gal oblig­a­tions, as an ex­em­plar, if it ex­pects every­one else to meet theirs.

The same is true of the for­eign ex­change scarci­ty. Blam­ing non-ex­is­tent car­tels or ac­cus­ing cred­it card hold­ers of abus­ing their en­ti­tle­ments fails to ad­dress the root cause of the sys­temic is­sues. The largest user of for­eign ex­change is nei­ther phar­ma­ceu­ti­cals nor food im­ports nor car im­ports; it is fu­el, which is con­trolled by a state en­ter­prise. The re­al­i­ty is that for­eign ex­change is in short sup­ply for every­one.

Fac­ing the chal­lenges re­quires dis­ci­pline, or­gan­i­sa­tion, and co­her­ent, con­sis­tent poli­cies. Blus­ter­ing, bluff­ing, and be­moan­ing the past do not over­come the chal­lenges, nor do they con­struc­tive­ly en­gage cit­i­zens. S&P’s neg­a­tive out­look is an ob­jec­tive as­sess­ment of the chal­lenges fac­ing the coun­try. There have been fail­ings, and mis­takes will be made, but the chal­lenges must be ad­dressed con­struc­tive­ly. This re­quires clear poli­cies and guide­lines, and the pub­lic must un­der­stand how they will be im­pact­ed.

Mar­i­ano Browne is the Chief Ex­ec­u­tive Of­fi­cer of the UWI Arthur Lok Jack Glob­al School of Busi­ness.