Economists Urge Diversification To Solve Foreign Exchange Woes
As Trinidad and Tobago grapples with foreign exchange shortages and declining industries, economists are calling for a shift in mindset. With the 2026 National Budget on the horizon, experts gathered at UWI’s Institute of International Relations for a Pre-Budget Forum.
Financial Economist Dr. Dave Seerattan is urging policymakers to act with future generations in mind. He also praised the newly appointed Central Bank Governor, for truly beginning to understand how the foreign exchange market functions in an economy like ours, something Dr Seerattan has been advocating for over the past five years.
« But irrespective of whether oil and gas prices were high or low we had a problem in term of excess demand, so it tells you that irrespective of the administration in power, irrespective of the price that we get for our energy products and so on, this is something that long term, that is structural. This is something that you cannot fix in a year or a day or even five years. »
Development Economist Dr. Vanus James says Trinidad and Tobago has real potential to grow its economy by focusing on high-value services. He pointed to education, healthcare, financial services, and long-stay tourism as areas where the country can compete globally, and earn much-needed foreign exchange.
« For example, you bring a student to Trinidad and Tobago from abroad to spend six months and what that does is it elevates you domestic demand funded by foreign exchange. »
Economist Dr. Indira Sagewan emphasised that while hydrocarbons will remain a key part of Trinidad and Tobago’s economy, there is an urgent need to diversify by exploring other sectors, greening the economy, and reshaping existing industries to meet future demands.
« Whether it’s cocoa, whether it’s peppers, regardless of what it is, let us look at the entire value chain and see where we can operate and develop it to do so. I spoke to manufacturing, tourism I believe is a no-brainer, especially given our current forex situation but we need to rethink tourism, we need to rethink and reshape tourism, both in Trinidad and in Tobago and we have the capacity to do that. »
At Thursday’s Pre-Budget Forum, hosted by the University of the West Indies, St. Augustine’s Institute of International Relations, Chief Executive Officer of the Trinidad and Tobago Manufacturers’ Association, Dr. Ramesh Ramdeen, urged the government to maintain its leading role in driving growth in the manufacturing sector.
