OVER the last nine years, Trinidad and Tobago has witnessed a steady unravelling of its economy, a collapse of key industries, and the slow but sure erosion of its social and economic fabric. The People’s National Movement (PNM) government, in power for this period, has presided over a declining state that once thrived on the riches of oil and gas.
However, what has transpired is a classic case of missed opportunities, delayed reforms, and a devastating dependence on a dying industry. This is the recipe for a failed state, as seen through the PNM’s governance.
Dependency on oil and gas
Trinidad and Tobago’s heavy reliance on oil and gas has been its Achilles’ heel. For decades, the economy was built around these industries, accounting for over 80% of export revenue. However, between 2015 and 2024, the country saw a sharp decline in oil production, dropping by more than 50%. Natural gas output, which was once the backbone of the economy, also declined from 4.3 billion cubic feet per day in 2010 to just 2.7 bcf/d in 2023.
Instead of pivoting toward other sectors, the PNM government failed to accelerate economic diversification effortsAs a result, revenue streams dwindled, and the government has struggled to plug budgetary gaps.
Oil prices
The global shift towards renewable energy and volatile oil prices have wreaked havoc on T&T’s public finances. From 2015 onwards, as oil prices dropped and production fell, government revenues plunged by $2.5 billion. The PNM, however, seemed woefully unprepared for this inevitable shift. Budget shortfalls became common, and while debt levels have stabilised at 67% of GDP, the lack of fiscal space crippled the government’s ability to invest in necessary reforms
The country’s dependence on the energy sector made it vulnerable, and the government failed to buffer the economy with alternative revenue sources.
Diversification
While the PNM made lofty promises of economic diversification, the reality has been different. In 2023, non-energy sectors like manufacturing accounted for a mere 10% of GDP.
The tourism industry, which many Caribbean nations have relied on for economic resilience, contributed just 3% of GDP, lagging far behind countries like Jamaica and Barbados. The agricultural sector, another potential growth area, remained neglected. Nine years into PNM governance, these industries remain underdeveloped and underfunded.
Public Debt
By 2024, Trinidad and Tobago’s public debt stood at 67% of GDP, driven by repeated fiscaln deficits that averaged 7.5% of GDP between 2020 and 2022. The government’s reliance on energy revenues, without significant reforms to its spending habits or revenue generation methods, has strained public finances.
The lack of innovative fiscal policies and the failure to control public spending during revenue downturns is emblematic of the PNM’s approach to governance—short-term fixes with long-term consequences
Unemployment
Official statistics show that the unemployment rate stood at 3.2% in 2023, a seemingly positive figure. However, this hides the larger issue of underemployment and job insecurity, particularly in non-energy sectors. Youth unemployment remains at a staggering 12%, with many unable to find stable, long-term employment. As the energy sector continues to shrink and other sectors fail to expand, T&T’s youth are left without viable opportunities.
Foreign direct investment
Under PNM rule, foreign direct investment has dried up, falling from $800 million a decade ago to just $250 million in 2022. Investors are deterred by the slow business environment, bureaucratic inefficiencies, and the over-reliance on an unstable energy sector. The PNM has failed to implement necessary reforms to make the country more attractive to investors, particularly in emerging sectors like renewable energy and high-tech manufacturing.
Bureaucracy
T&T ranks 105th out of 190 countries in the World Bank’s “Ease of Doing Business” index, a reflection of the cumbersome and slow bureaucracy. Under the PNM, regulatory hurdles have worsened. It can take 140 days to secure a construction permit, almost double the global average. This inefficiency has stifled entrepreneurial initiatives and deterred business expansion, further compounding the country’s economic woes.
Bleak future
After nine years of PNM governance, T&T faces a bleak future. The mismanagement of the country’s natural resources, the failure to diversify the economy, fiscal irresponsibility, and a crippling bureaucracy have all but guaranteed a near-failed state.
As the country grapples with these issues, the people are left wondering if the once-vibrant economy can ever recover or if the PNM has led them down an irreversible path to failure.
This is a sole PNM saga of missed opportunities, negligence, and a disregard for the realities of the global economy—a recipe for a failed state.
Shiva Ramnarine, founder of Mobius Solutions Consultancy, has over 25 years of experience as an executive and finance business leader. He is also a former chief financial officer of the Telecommunications Authority of Trinidad and Tobago. The views and opinions expressed in this guest commentary does not necessary reflect that of AZP News, a Division of Complete Image Limited
Commentary: T&T – A Recipe for a Failed State
Guest Commentary
OVER the last nine years, Trinidad and Tobago has witnessed a steady unravelling of its economy, a collapse of key industries, and the slow but sure erosion of its social and economic fabric. The People’s National Movement (PNM) government, in power for this period, has presided over a declining state that once thrived on the riches of oil and gas.
However, what has transpired is a classic case of missed opportunities, delayed reforms, and a devastating dependence on a dying industry. This is the recipe for a failed state, as seen through the PNM’s governance.
Dependency on oil and gas
Trinidad and Tobago’s heavy reliance on oil and gas has been its Achilles’ heel. For decades, the economy was built around these industries, accounting for over 80% of export revenue. However, between 2015 and 2024, the country saw a sharp decline in oil production, dropping by more than 50%. Natural gas output, which was once the backbone of the economy, also declined from 4.3 billion cubic feet per day in 2010 to just 2.7 bcf/d in 2023.
Instead of pivoting toward other sectors, the PNM government failed to accelerate economic diversification effortsAs a result, revenue streams dwindled, and the government has struggled to plug budgetary gaps.
Oil prices
The global shift towards renewable energy and volatile oil prices have wreaked havoc on T&T’s public finances. From 2015 onwards, as oil prices dropped and production fell, government revenues plunged by $2.5 billion. The PNM, however, seemed woefully unprepared for this inevitable shift. Budget shortfalls became common, and while debt levels have stabilised at 67% of GDP, the lack of fiscal space crippled the government’s ability to invest in necessary reforms
The country’s dependence on the energy sector made it vulnerable, and the government failed to buffer the economy with alternative revenue sources.
Diversification
While the PNM made lofty promises of economic diversification, the reality has been different. In 2023, non-energy sectors like manufacturing accounted for a mere 10% of GDP.
The tourism industry, which many Caribbean nations have relied on for economic resilience, contributed just 3% of GDP, lagging far behind countries like Jamaica and Barbados. The agricultural sector, another potential growth area, remained neglected. Nine years into PNM governance, these industries remain underdeveloped and underfunded.
Public Debt
By 2024, Trinidad and Tobago’s public debt stood at 67% of GDP, driven by repeated fiscaln deficits that averaged 7.5% of GDP between 2020 and 2022. The government’s reliance on energy revenues, without significant reforms to its spending habits or revenue generation methods, has strained public finances.
The lack of innovative fiscal policies and the failure to control public spending during revenue downturns is emblematic of the PNM’s approach to governance—short-term fixes with long-term consequences
Unemployment
Official statistics show that the unemployment rate stood at 3.2% in 2023, a seemingly positive figure. However, this hides the larger issue of underemployment and job insecurity, particularly in non-energy sectors. Youth unemployment remains at a staggering 12%, with many unable to find stable, long-term employment. As the energy sector continues to shrink and other sectors fail to expand, T&T’s youth are left without viable opportunities.
Foreign direct investment
Under PNM rule, foreign direct investment has dried up, falling from $800 million a decade ago to just $250 million in 2022. Investors are deterred by the slow business environment, bureaucratic inefficiencies, and the over-reliance on an unstable energy sector. The PNM has failed to implement necessary reforms to make the country more attractive to investors, particularly in emerging sectors like renewable energy and high-tech manufacturing.
Bureaucracy
T&T ranks 105th out of 190 countries in the World Bank’s “Ease of Doing Business” index, a reflection of the cumbersome and slow bureaucracy. Under the PNM, regulatory hurdles have worsened. It can take 140 days to secure a construction permit, almost double the global average. This inefficiency has stifled entrepreneurial initiatives and deterred business expansion, further compounding the country’s economic woes.
Bleak future
After nine years of PNM governance, T&T faces a bleak future. The mismanagement of the country’s natural resources, the failure to diversify the economy, fiscal irresponsibility, and a crippling bureaucracy have all but guaranteed a near-failed state.
As the country grapples with these issues, the people are left wondering if the once-vibrant economy can ever recover or if the PNM has led them down an irreversible path to failure.
This is a sole PNM saga of missed opportunities, negligence, and a disregard for the realities of the global economy—a recipe for a failed state.
Shiva Ramnarine, founder of Mobius Solutions Consultancy, has over 25 years of experience as an executive and finance business leader. He is also a former chief financial officer of the Telecommunications Authority of Trinidad and Tobago. The views and opinions expressed in this guest commentary does not necessary reflect that of AZP News, a Division of Complete Image Limited