Navigating global and regional uncertainties

The next four years were always going to be challenging for the recently elected government based on the economy it inherited from the previous one.

Addressing the twin challenges of achieving steady economic growth and diversifying the export mix away from dependence on the energy sector is complex.

Compounding this already difficult situation is the instability of the geopolitical environment, which is affecting the local business climate.

This was evidenced by the results of the Business Outlook Index (BOI) for Q4 2025, which was published last week by the TT Chamber of Industry and Commerce in partnership with the Arthur Lok Jack Global School of Business.

Over half of executives reported financial performance challenges. Despite this, executives remained confident about the economic and investment prospects for both the next 6- and 12-month horizons.

This was a positive note and coincided with the announcement of a new Private Sector Organisation of Trinidad and Tobago to act as a single voice for business.

Its purpose is to drive export growth, attract capital and reverse the country’s chronic foreign exchange shortage. Its challenge is to provide a credible platform for a coordinated private sector approach working alongside the Ministry of Trade, Investment and Tourism.

A key task for PSOTT will be to get MTIT to address the persistent structural challenges which affect business confidence.

In contrast to these positive developments, President Trump’s pointed comment in an interview last Monday that Venezuela’s President Maduro’s days in office were numbered, and the seizure of an oil tanker points to increasing tensions.

On Friday, Reuters reported that oil tanker movements in and out of Venezuela had come to a virtual standstill after the US announced that it would seize more vessels as part of its military pressure on Venezuela’s President, which raises the risk of miscalculation by the US and Venezuela, with unknown consequences.

These are waters we must navigate ahead as we seek more foreign direct investment and earn more foreign exchange.

The Central Bank’s November monetary report noted that sales of foreign exchange had declined by US$295 million over the past year, confirming that the foreign exchange scarcity we have been experiencing for years continues.

On Friday, Moody’s Ratings (Moody’s) changed Trinidad & Tobago’s outlook to negative from stable, explaining that the change in outlook to negative reflected “rising external vulnerability,” as liquid foreign exchange reserves had declined by 24 per cent over the last year, falling short of its projections.

Addressing the distortions in the foreign exchange market requires meaningful policy changes and market-based solutions to address the structural issues.

These are no easy challenges for the Government to face, particularly since many of them were not of its own making.

There is little to suggest that the geopolitical climate would suddenly change for the better, particularly for countries like ours that are dependent on the right markets and prices for the sale of our natural resources.

What will ultimately matter, therefore, is not the absence of pressure but the presence of resolve.

Navigating an uncertain global landscape will demand resilience, prudent decision-making and a firm commitment to good governance, one that prioritises transparency, fiscal discipline and the long-term national interest over short-term expediency.

In such times, steady leadership and sound institutions are the country’s greatest safeguards, ensuring that even amid external shocks, progress remains possible and confidence in the future is sustained.