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TRADE POLICY REVIEWS: SECOND PRESS RELEASE AND CHAIRPERSON'S  CONCLUSIONS
Trinidad and Tobago: November 1998

“ Members congratulated Trinidad and Tobago on its recent liberalization and economic reforms, which had resulted in steady growth rates, low inflation and had attracted substantial foreign investment.”

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Summary of Secretariat report
  > Summary of Government report


PRESS RELEASE
PRESS/TPRB/90
13 November 1998

TRADE POLICY REVIEW BODY: REVIEW OF TRINIDAD AND TOBAGO
TPRB'S EVALUATION
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The Trade Policy Review Body of the World Trade Organization (WTO) concluded its first review of Trinidad and Tobago's trade policies on 12 and 13 November 1998. The text of the Chairperson's concluding remarks is attached as a summary of the salient points which emerged during the discussion. The review enables the TPRB to conduct a collective examination of the full range of trade policies and practices of each WTO member country at regular periodic intervals to monitor significant trends and developments which may have an impact on the global trading system.

The review is based on two reports which are prepared respectively by the WTO Secretariat and the government under review and which cover all aspects of the country's trade policies, including its domestic laws and regulations, the institutional framework, bilateral, regional and other preferential agreements, the wider economic needs and the external environment. A record of the discussion and the Chairperson's summing-up together with these two reports, will be published in due course as the complete trade policy review of Trinidad and Tobago and will be available from the WTO Secretariat, Centre William Rappard, 154 rue de Lausanne, 1211 Geneva 21.

Since December 1989, the following reports have been completed: Argentina (1992), Australia (1989, 1994 & 1998), Austria (1992), Bangladesh (1992), Benin (1997), Bolivia (1993), Botswana (1998), Brazil (1992 & 1996), Cameroon (1995), Canada (1990, 1992, 1994 & 1996), Chile (1991 & 1997), Colombia (1990 & 1996), Costa Rica (1995), C˘te d'Ivoire (1995), Cyprus (1997), the Czech Republic (1996), the Dominican Republic (1996), Egypt (1992), El Salvador (1996), the European Communities (1991, 1993, 1995 & 1997), Fiji (1997), Finland (1992), Ghana (1992), Hong Kong (1990 & 1994), Hungary (1991 & 1998), Iceland (1994), India (1993 & 1998), Indonesia (1991 and 1994), Israel (1994), Jamaica (1998), Japan (1990, 1992, 1995 & 1998), Kenya (1993), Korea, Rep. of (1992 & 1996), Lesotho (1998), Macau (1994), Malaysia (1993 & 1997), Mauritius (1995), Mexico (1993 & 1997), Morocco (1989 & 1996), New Zealand (1990 & 1996), Namibia (1998), Nigeria (1991 & 1998), Norway (1991 & 1996), Pakistan (1995), Paraguay (1997), Peru (1994), the Philippines (1993), Poland (1993), Romania (1992), Senegal (1994), Singapore (1992 & 1996), Slovak Republic (1995), the Solomon Islands (1998), South Africa (1993 & 1998), Sri Lanka (1995), Swaziland (1998), Sweden (1990 & 1994), Switzerland (1991 & 1996), Thailand (1991 & 1995), Trinidad and Tobago (1998), Tunisia (1994), Turkey (1994 & 1998), the United States (1989, 1992, 1994 & 1996), Uganda (1995), Uruguay (1992), Venezuela (1996), Zambia (1996) and Zimbabwe (1994).

TRADE POLICY REVIEW BODY:   REVIEW OF TRINIDAD AND TOBAGO
CONCLUDING REMARKS BY THE CHAIRPERSON
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The first Trade Policy Review of Trinidad and Tobago was conducted by the TPR Body on 12-13 November 1998. These remarks, prepared on my own responsibility, are intended to summarize the main points of the discussion; they are not intended as a full report. Further details of the discussion will be fully reflected in the minutes.

The discussion developed under three main themes: (i) economic environment; (ii) trade policy measures; and (iii) sectoral policies.

Economic environment

Members congratulated Trinidad and Tobago on its recent liberalization and economic reforms, which had resulted in steady growth rates, low inflation and had attracted substantial foreign investment. However, challenges remained, including dependency on the energy sector, high unemployment and a still sizeable participation of the State in key sectors. Also, the traditional trade surplus had turned to deficit in 1997, primarily as a consequence of a surge in imports. There was also concern about the effect of lower oil prices on export earnings and government revenue. Members welcomed the steps taken by Trinidad and Tobago to develop a legal framework for competition policy and encouraged its prompt implementation. There was some worry about the range, cost and coherence of the various incentive schemes, particularly with respect to investment, for which procedures were also sometimes cumbersome. Members encouraged Trinidad and Tobago to continue to seek the diversification of economic activity and to accelerate the process of privatization, particularly in the agriculture and energy sectors.

Members commended Trinidad and Tobago on its commitments to the multilateral trading system particularly as seen by the implementation of WTO agreements in some cases ahead of schedule. They acknowledged the importance of Trinidad and Tobago's role within CARICOM.

The representative of Trinidad and Tobago expressed his country's firm adherence to a rule-based multilateral trading system. His country had willingly assumed the obligations resulting from the Uruguay Round. However, he felt that the WTO needed to address the particular interests and needs of developing country members and to ensure that sustained efforts were made towards balancing the obligations assumed and the benefits derived from the system. He stressed the need for new approaches to deal with the special treatment and differential treatment for developing countries in the WTO, for example through the provision of technical assistance and through technology transfer. As a small island economy, Trinidad and Tobago fully supported initiatives in international fora to identify measures to integrate small states into the global economy.

On the issues raised by Members, the representative of Trinidad and Tobago said his Government had undertaken a trade reform programme to diversify the economy away from the petroleum sector and to improve employment opportunities. Unemployment had already declined significantly. On the trade deficit, capital imports had been an important factor. He identified several sectors with the potential for sustainable export-led growth, including financial services, agro-processing, software development, specialty chemicals, engineering goods and services, and cultural tourism. Future economic strategies would include continued efforts to attract foreign investment and to foster the development of small businesses, tourism and light manufacturing sectors. The representative noted that the process of amending investment legislation would lead to a simplification of procedures and enhance transparency.

Trade policy measures

Members welcomed Trinidad and Tobago's trade liberalization, including a lowering of tariffs, virtual elimination of quantitative restrictions and a reduction in the scope of import licensing. In encouraging Trinidad and Tobago to continue with these efforts, Members raised a number of questions particularly with respect to: the gap between applied and bound tariff rates; high import surcharges on agricultural products; import licensing; notification of legislation dealing with anti-dumping and countervailing measures; standards and technical regulations; tax allowances for exports; and intellectual property rights, especially with respect to enforcement of copyrights.

In reply, the representative of Trinidad and Tobago stated that the maximum tariff rate had been reduced from 45% to 20% over five years, and that there were no immediate plans to lower tariffs further. Any alteration of the Common External Tariff would require approval from the CARICOM Heads of Government. With regard to the gap between applied and bound tariffs for agricultural products, the Government intended to re-examine bindings upon completion of a review of agricultural policies. The representative noted that only a few items were currently subject to licencing, mainly for public safety and national security reasons, as well as under CARICOM Treaty obligations. Trinidad and Tobago had amended its anti-dumping legislation to ensure conformity with its WTO obligations; a notification in this respect would shortly be submitted to the WTO. Apart from anti-dumping, Trinidad and Tobago had amended its legislation and procedures in a number of areas, including TRIPS and customs valuation, and was in the process of drafting or revising legislation in other areas. The procedure for setting standards was also explained.

With regard to export allowances, involving a tax credit based on certain export earnings, the representative of Trinidad and Tobago said that, in accordance with the Budget Speech of 1998, they would be eliminated in 2002. Trinidad and Tobago was addressing the problem of enforcement of intellectual property rights, particularly regarding video and audio cassette piracy. The representative of Trinidad and Tobago stressed the need for technical assistance to strengthen the capacity of small trading partners to meet reporting obligations under the WTO and to fully exercise their rights.

Sectoral policies

Members acknowledged Trinidad and Tobago's efforts to diversify its economy, reducing its dependency on the energy sector by facilitating activity in non-petroleum manufacturing and services. On agriculture, Members posed questions with regard to issues such as: high import surcharges, quantitative restrictions applied to imports of live poultry, and the role of state-owned enterprises in the sector. Regarding the energy sector, Trinidad and Tobago was encouraged to implement a more transparent pricing structure for natural gas. On services, Members welcomed Trinidad and Tobago's commitments in the GATS and encouraged a broadening of their scope, particularly in financial services. A number of questions were raised on specific issues, including "exclusive rights" provisions in telecommunications; banking sector regulations and licensing requirements; transparency in the work permits regime; and licensing and cargo handling in both maritime and airline services.

The representative of Trinidad and Tobago stated that the high surcharges applied to the agricultural sector would be reviewed before 2004 with a view to ensuring compliance with WTO commitments. Regarding maritime transport services, the Government was considering a proposal for the restructuring of port operations. On financial services, national treatment was accorded to foreign providers, and the Government was finalizing an offer on banking to be presented by January 1999. The Government was pursuing the matter of exclusive rights on basic telecommunication services with the provider, with a view to advancing liberalization in this sector. Amendments were being made to the Telecommunications Act; these were expected to be approved by June 1999, allowing Trinidad and Tobago to meet its GATS obligations. Detailed answers were also provided regarding civil aviation and the issuance of work permits.

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In conclusion, Members expressed appreciation for Trinidad and Tobago's liberalization efforts, and prompt compliance with their obligations under the WTO. Members strongly welcomed the many steps that Trinidad and Tobago had already taken in becoming a more open and outward-oriented economy that was integrated into the multilateral system; they acknowledged the challenges faced by Trinidad and Tobago as a small resource-based economy and appreciated the reform programme to diversify the economy. It was felt that a continuation of Trinidad and Tobago's trade-opening efforts would consolidate the basis for economic diversification and for steady, sustainable growth; in this respect, the support of Trinidad and Tobago's trading partners would also be important.