(PRESS RELEASE) – The rise of exports in the agro-processing sector unlocks exciting opportunities for economic diversification in Trinidad and Tobago (T&T).
This, according to the latest policy brief published by the Economic Commission for Latin America and the Caribbean (ECLAC), entitled `Policy actions to facilitate upgrading of the agricultural sector in Trinidad and Tobago’. According to the brief, there is room for T&T to expand productive capacity and diversify exports in the agro-processing industry to improve foreign exchange earnings.
The Government of T&T has articulated in its National Development Strategy for 2016-2030 and in its 2018 Midyear Budget Review the intention to transition towards a more diversified economy, which produces a broad spectrum of export competitive, high-value products and services. In this context, the government has identified agro-processing as one of the seven economic areas for the establishment of new business clustering. This stems from fulsome discussions on the viability of developing and diversifying domestic primary agricultural production to boost exports and supply inputs into the local agro-processing industry.
The empirical findings of ECLAC’s new policy brief suggest that Trinidad and Tobago does in fact have a comparative advantage in the input and processing segments. This is due in part to its capacity for intra-industry trade with Central and South America, and the wider Caribbean, when compared with its other trading partners.
The brief takes a look at the structure and performance of the agriculture industry across the country, and considers policy action to facilitate upgrading of the sector where necessary to improve its competitiveness and participation in global and regional value chains. In this regard, the brief highlights that there is room to expand productive capacity and diversify exports in the agro-processing industry to improve foreign exchange earnings. However, this would require transforming the country’s export specialization through vertical integration, to ensure that the country increasingly produces goods in these segments that western hemispheric and other global economies are increasingly demanding.
Upgrading the attendant economic, financial, research and development infrastructure, as well as facilitating an entrepreneurial self-discovery process – which does not veer too far from the existing areas of comparative advantage – are crucial for inducing this structural shift.