Our comprehensive assessment of Trinidad & Tobago's operating environment and the outlook for its leading sectors are formed by bringing together a wealth of data on global markets that affect Trinidad & Tobago, as well as the latest industry developments that could impact Trinidad & Tobago's industries. This unique integrated approach has given us an impeccable track-record for predicting important shifts in the markets, ensuring you’re aware of the latest market opportunities and risks in Trinidad & Tobago before your competitors.
Trinidad & Tobago Country Risk
Trinidad & Tobago (T&T)'s economy will see weak economic activity growth in the coming years, as structurally lower oil prices weigh on consumption, investment and net exports. Low oil prices will weigh on the hydrocarbon sector's 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. Tight control over foreign exchange sales by the central bank will prevent a significant depreciation of...
Trinidad & Tobago Industry Coverage (6)
Food & Drink
Trinidad & Tobago Food & Drink
BMI View: We are turning more positive regarding economic growth in the Caribbean, as structural and financial reforms take hold in the region, tourism numbers pick up and growth becomes stronger in key markets like the US. The Dominican Republic and Jamaica will outperform other regional markets over the next five years. Nonetheless, small consumer bases will limit long-term investment opportunities.
|Dominican Republic The Regional Outperformer|
|Select Countries - Food Sales Growth (% chg y-o-y, USD terms)|
Trinidad & Tobago Insurance
BMI View: Currency weakness will continue to plague the dollar terms returns of many of the Caribbean insurance sectors covered in this report. Offshore business in Barbados and the Cayman Islands, amounting to around USD45bn annually, dwarf the domestic sectors in the region. Health insurance, an underdeveloped line of business, is likely to outperform in many of these markets over the five-year forecast period.
The insurance markets of the Caribbean, particularly offshore business in Barbados and the Cayman Islands, but also domestic sectors, are heavily tied to the economic fortunes of the United States and, to a lesser extent, Canada. The ongoing recovery in both major North American markets should boost the fortunes of the region's insurers, driving demand for offshore reinsurance and captives, as well as boosting domestic economies. On the whole, regulation...
Trinidad & Tobago Insurance
BMI View: Trinidad & Tobago is one of the more developed insurance markets in the Caribbean region, with high penetration and density levels a reflection of the country's relatively high income levels and standards of living. At USD360 per capita, life insurance gross premiums are nearly three times higher than those of Jamaica, for example, and this relatively high level of maturity is likely a constraint in terms of future expansion. While we expect both life and non-life premiums to record positive growth over the forecast period, this will be constrained by economic headwinds, including falling energy revenues, further contraction in GDP in 2016 and sluggish consumer spending.
Meanwhile, the weakness of the Trinidadian dollar will further dent revenues in USD terms. Given these constraints, we see relatively few opportunities for investors or new entrants to the sector over the...
Oil & Gas
Trinidad & Tobago Oil & Gas
BMI View: Shortages of natural gas are expected to persist at least until the start of the Juniper field in late 2017. These supply challenges will continue to disrupt gas exports and comes amid government concerns over the profitability of liquefied natural gas exports. The government has also called for operators to fully exploit existing acreage, suggesting the emergence of tensions between officials and upstream players. While a series of major wells are planned in 2016, investment has already been delayed due to the current market conditions, underscoring the impact of the current low oil price on the sector.
Trinidad & Tobago Telecommunications
BMI View: Haiti and Cuba represent the largest organic growth opportunities in the region, as both are significantly underdeveloped compared to their peers. However, the risks associated with business in these two markets mean that a mobile subscription boom is far from likely.
Cayman Islands has the highest mobile penetration, at 153.4% in 2015, while Cuba's penetration rate remains below the regional average, at 28.9%.
The number of mobile lines in Cuba reached the 3mn mark in Q215, up from 2.4mn lines at the start of 2015, according to data published by state-owned telecoms operator Empresa de Telecomunicaciones de Cuba (ETECSA). The increase was mainly owing to a promotion, called Si activas ganas 30, wherein new users obtained USD30 in credit for activating a...
Trinidad & Tobago Tourism
BMI View: Arrivals growth in the Caribbean will pick up to 2.3% in 2016, reflecting improved visitor numbers from Europe and North America. The Dominican Republic, St Eustatius and Cuba are expecting the highest rate of arrivals growth, but all tourism markets will experience growth in 2016. However, the outbreak of the Zika virus from late 2015 could pose downside risks to 2016 arrivals forecasts.
We currently expect arrivals to the Caribbean to grow by 2.3% in 2016, to 33.5mn, reflecting an improvement from growth of only 0.6% in 2015. We expect the Dominican Republic, Cuba, St Eustatius and St Lucia to post the highest level of arrivals growth in 2016, at around 6%, but we note the positive sign that all Caribbean countries except St Vincent will experience arrivals growth in 2016, for the first time since the downturn....