Trinidad & Tobago Country Risk Report

Providing comprehensive data and in-depth analysis of political, financial and economic risk.

Report includes: BMI's Core Views, 10-year Forecasts, BMI's Economic Risk Index, Political Stability and Risk Index, Long-term Political Outlook, Operational Risk Index, SWOT Analysis and Structural Economic Sections

Why you should buy this report

  • Understand and measure the political, business environment and operational risks to your company
  • Gain insight on emerging trends that could support, strengthen or disrupt your activities in the market
  • Benefit from 10-year macroeconomic forecasts and insight into the structural characteristics of the economy
  • Get the long-term political outlook and explore possible scenarios for change
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Trinidad & Tobago Country Risk Report
Product Price
$1,195.00

Core Views:

  • Trinidad & Tobago (T&T)'s economy will see weak economic activity growth in the coming years, as persistently weak oil prices weigh on consumption, investment and net exports. Low oil prices will compound the country's hydrocarbon sector poor production outlook, while non-oil industries will struggle to become competitive.

  • The government will post consistent fiscal deficits, as low oil prices weigh on revenue collection. Expenditure cuts will be limited, as the government seeks to support economic activity.

  • Lower oil prices will place depreciatory pressure on the Trinidadian dollar (TTD) over the coming quarters, resulting in a deterioration of the country's terms of trade and weaker investment inflows. Open market operations by the central bank will prevent a significant depreciation of the currency, although the bank will allow the unit to gradually depreciate in the coming quarters.

Major Forecast Changes:

  • We have downwardly revised our current account surplus forecast to 1.0% of GDP in 2016 and 1.7% in 2017 due to continued weakness in oil exports.

  • We have downwardly revised our fiscal deficit forecast to 7.6% of GDP in 2016 and 7.4% in 2017 due to our Oil & Gas team's downward revision of its forecast oil price.

Key Risks

  • The primary risks lie to the downside. Should oil prices remain at current levels through 2016, the recession in T&T could be more severe than currently anticipated. In such a scenario, the CBTT could allow the Trinidadian dollar to depreciate more quickly than forecast, precipitating rising inflation, falling imports and a risk of capital flight.

Macroeconomic Forecasts (Trinidad & Tobago 2014-2017)
Indicator 2014 2015e 2016f 2017f
e/f=BMI estimate/forecast; Source: National Sources/BMI
Real GDP growth, % y-o-y 1.9 -1.5 -0.2 2.7
Nominal GDP, USDbn 28.2 28.5 28.6 28.1
Consumer price inflation, % y-o-y, eop 8.5 3.3 3.9 5.3
Exchange rate TTD/USD, eop 6.36 6.42 6.50 6.75
Budget balance, % of GDP -2.7 -5.8 -7.6 -7.4
Current account balance, % of GDP 5.8 1.7 1.0 1.7
Executive Summary
5
Core Views
5
Major Forecast Changes
5
Key Risks To Outlook
5
Chapter 1: Political Outlook
7
SWOT Analysis
7
BMI Political Risk Index
7
Domestic Politics
8
Opposition Victory Ahead As Security Situation Deteriorates
8
Table: Political Overview
8
Chapter 2: Economic Outlook
11
SWOT Analysis
11
BMI Economic Risk Index
11
Economic Activity
12
Non-Energy Sector Will Drive Growth
12
table: GDP
12
Fiscal Policy
13
Election Will Keep Spending Elevated
13
table: Fiscal Policy
13
Monetary Policy
15
Further Rate Hikes Ahead Amid US Monetary Policy Normalisation
15
table: Policy Rate
15
Balance Of Payments
16
Narrower Current Account Surplus Ahead
16
table: Current Account
17
Exchange Rate Policy
19
TTD: Strength Through H215 Before Gradual Depreciation
19
table: BMI Currency Forecast
19
Chapter 3: 10-Year Forecast
21
The Trinidad & Tobago Economy To 2024
21
Structurally Lower Oil Prices To Drag On Long-Term Growth
21
table: Long-Term Macroeconomic Forecasts
21
Chapter 4: Operational Risk
25
SWOT Analysis
25
Operational Risk Index
25
Operational Risk
26
table : Caribbean - Operational Risk
26
table : Caribbean - Labour Market Risk
27
TABLE: Caribbean - Logistics Risk
28
TABLE: Caribbean - Trade And Investment Risk
29
Chapter 5: BMI Global Macro Outlook
33
Global Outlook
33
Assessing The Aftermath Of Three Key Events
33
Table: Global Assumptions
33
Table: Developed States, Real GDP Growth, %
34
Table: BMI VERSUS BLOOMBERG CONSENSUS REAL GDP GROWTH FORECASTS, %
34
Table : Emerging Markets , Real GDP Gro wth , %
35

The Trinidad & Tobago Country Risk Report helps businesses with market assessment, strategic planning and decision making to promote growth and profitability in Trinidad & Tobago. It is an essential tool for CEOs, Chairmen, Finance Directors/CFOs, Managing Directors, Marketing/Sales Directors with commercial interests in this emerging market.

An influential new analysis of Trinidad & Tobago's economic, political and financial prospects through end-2019, just published by award-winning forecasters, BMI Research.

Key Uses

  • Forecast the pace and stability of Trinidad & Tobago's economic and industry growth through end-2019.
  • Identify and evaluate adverse political and economic trends, to facilitate risk mitigation.
  • Assess the critical shortcomings of the operating environment that pose hidden barriers and costs to corporate profitability.
  • Contextualise Trinidad & Tobago's country risks against regional peers using BMI's country comparative Risk Index system.
  • Evaluate external threats to doing business in Trinidad & Tobago, including currency volatility, the commodity price boom and protectionist policies.

The Trinidad & Tobago Country Risk Report by BMI Research includes three major sections: Economic Outlook, Political Outlook and Operational Risk.

Economic Outlook:

How will the Trinidad & Tobago' economic policy-making and performance impact on corporate profitability over 2015-2019?

BMI provides our fully independent 5-year forecasts for Trinidad & Tobago through end-2019 for more than 50 economic and key industry indicators. We evaluate growth, and also forecast the impact of economic management.

Economic Outlook Contents

The Trinidad & Tobago Country Risk Report features BMI's forecasts with supporting analysis for 2015 through to end-2019, set against government views and BMI's evaluation of global and regional prospects.

Key Areas Covered:

Data:

  • Full 10-year forecasts with data - for key macroeconomic variables including GDP (real growth and per capita), population, inflation, current account balance and the exchange rate.
  • BMI's comprehensive Risk Index system - rates each country worldwide for economic and political risk, and rates the business environment, within a global and regional context.

Written Analysis:

  • Economic Activity - real GDP growth, employment, inflation, consumption (retail sales and confidence).
  • Balance of Payments - trade and investment, current and capital account.
  • Monetary Policy - interest rate trends (bank lending and deposit rates) and inflation (producer price and consumer price).
  • Exchange Rate Policy - currency controls, foreign investment flows, exchange rates and foreign exchange reserves.
  • Fiscal Policy - macroeconomic strategy and policies, government finance and tax reforms.
  • Foreign Direct Investment - approvals, inflows and climate.
  • External Debt - debt profile (short and long-term plus public and private sector obligations).
  • Global Assumptions - forecasts for each year to end-2019 covering: major commodities, growth in key regions, inflation, and interest and exchange rates, in the United States, Japan, China and the eurozone.

Key Benefits

  • Rely upon BMI's 100% independent forecast scenarios for Trinidad & Tobago and underlying assumptions - we take no advertising and are privately-owned.
  • Exploit the benefits of BMI's comprehensive and reliable macroeconomic database on Trinidad & Tobago, sourced and fully maintained by BMI from an extensive network of private sector, government and multilateral contacts.
  • Gain key insights into the current and future direction of government economic policy, which could significantly affect your company's business prospects, from BMI's team of analysts and economists.

Political Outlook:

What are the political risks to doing business in Trinidad & Tobago over the next 5-years?

BMI's Trinidad & Tobago country Risk Index evaluates the short- and medium-term threats to political stability.

Political Outlook Contents

  • SWOT Analysis for the Trinidad & Tobago Market - Political Strengths, Weaknesses, Opportunities and Threats facing Trinidad & Tobago.
  • Political Stability and Risk Assessment - BMI's Risk Index assesses explicit short- and long-term risks to political stability; latest positioning and trends for Trinidad & Tobago's risk are compared with regional and global averages.
  • Current Administration and Policy-making BMI assesses the threats to the continuity of economic policy, and likely changes to the business operating environment.
  • Long-Term Political Outlook BMI examines the structural risks to the stability of Trinidad & Tobago’s political system and the dominant public policy issues likely to affect decision-makers, and outlines scenarios for how the state could evolve in the medium to long term.

Key Benefits

  • Benchmark Trinidad & Tobago's risk profile against its neighbours, the global and regional average, allowing easy comparison of risks between key business markets.
  • Identify, evaluate and anticipate political and security risks to the business environment, and to your company's current operations and future plans.
  • Gain valuable insights into government and policy-making, through BMI's specialist team of analysts and economists, and their network of private and public sector sources.

Operational Risk

What are the current operational risks and difficulties associated with doing business in Trinidad & Tobago?

The Operational Risk section gives an evaluation of current risks and difficulties associated with operating in the market. It also provides a brief overview of the regional Operational Risk Index which benchmarks Trinidad & Tobago against its neighbours.

Operational Risk Contents

The chapter provides a summary of the main threats in the country, within:

  • Labour Market Risk (Education; Availability of Labour; and Labour Costs)
  • Logistics Risk (Market Size and Utilities; Quality and Extent of the Transport Governance)
  • Trade and Investment Risk (Economic Openness; Government Intervention; and Legal Risks)
  • Crime and Security Risk (Crime; Terrorism; and Interstate Conflict risks).