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With commercial production of crude oil dating back to 1908, T&T’s long history in the energy industry has helped the country punch above its weight in regional and global terms. In 2013 T&T produced 1.5trn cu feet of natural gas, making it the world’s sixth-largest LNG exporter and largest LNG supplier to the US. T&T is also the world’s largest exporter of ammonia and second-largest exporter of methanol. In recent years natural gas has overtaken oil in importance, with crude oil production declining from a high of 144,674 bpd in 2005 to 81,278 bpd in 2013, reflecting maturing oilfields and operational challenges. Even so, the oil and gas sector remains a key pillar of T&T’s economy, accounting for 42% of GDP in 2014, 80% of exports from April 2013 to May 2014, and 34.8% of fiscal revenues for the period from October 2013 to September 2014. This chapter contains interviews with Kevin Ramnarine, Minister of Energy and Energy Affairs; Norman Christie, Regional President, BP Trinidad and Tobago (BPTT); and Indar Maharaj, President, National Gas Company (NGC).

The commercial banking sector is one of the many sources of stability in T&T’s economy. With eight long established banks, backed by major international groups or the government, T&T’s banking system is well capitalised, well regulated and conservative in its lending practices. According to the Central Bank of T&T, at the end of October 2014 the eight banks had total assets within the country of $20.2bn, with deposits and lending (except for mortgage loans) growing at single-digit rates. Though the system is awash with liquidity, efforts by the central bank to encourage a reduction in excess reserves have already had an impact in the first half of 2015. At the same time, downward pressure on net interest margins will continue to be an issue, with banks likely to remain focused on boosting fee income and/or controlling costs to maintain growth.

Conditions in T&T’s capital markets continue to be shaped by the central bank’s tightening of monetary policy. In line with the expectations of the financial sector, the central bank moved ahead with a fifth consecutive increase in its repo rate of 25 basis points to 4% in late May 2015. The increases have begun to have an impact on domestic money market rates, or commercial banks’ prime lending rate, which rose to 8% in May 2015, up from around 7.5% before the repo rate hikes. Activity in the primary and secondary markets was moderate in the first nine months of 2014, with four issuers raising $639.93m through six separate securities in the primary market. In the secondary market, government bonds with a total value of $140.2m were traded. With the exception of government bonds with short to medium tenors, yields generally moved in an upwards direction.

In global terms, T&T ranks as a small but well established market for insurance. According to figures from the Association of T&T Insurance Companies, general insurers wrote gross premiums of around $494.1m in 2013, while life and health insurers wrote gross premiums of about $524.3m. Over the previous five years, the general trends in profitability have been favourable. Life insurance companies’ expense ratio declined from 40.6% in 2009 to 36.4% in the period to September 2013, while return on equity for general insurance firms increased from 16.7% to 18.6%. At 3.7% in 2013, insurance penetration in T&T is broadly in line with regional averages, suggesting further room for growth. A new insurance bill set to be passed in the near term will incorporate a minimum continuing capital and surplus requirement regime, and contribute to the strengthening of the industry’s legal framework. This chapter contains an interview with Ravi Tewari, Group CEO, Guardian Holdings.

Though tourism plays a significant role in T&T’s economy, unlike other Caribbean economies, it is not the most important sector. Its total contribution to GDP in 2013 was $1.26bn, or 3.1%, and the industry directly and indirectly employed 27,500 people, or 4.5%. In the past decade, arrivals have fluctuated between a low of 388,000 in 2010, reflecting the global slump in 2008-09, and a high of just over 460,000, achieved in 2004-05, before the financial crisis. In 2014 a total of 461,267 visitors came to T&T, down 1.2% from the previous year. Even so, tourism remains the top services sector revenue earner, generating $1.29bn worth of receipts in 2013, equivalent to 4.8% of total exports. In the light of the recent rapprochement between the US and Cuba, the larger Caribbean tourism industry could be set to see some realignment in the coming years. This chapter contains an interview with Keith Chin, CEO, Tourism Development Company (TDC).

An important contributor to T&T’s economy, the construction industry accounted for an estimated 5.2% of GDP in 2014 and 15.6% of the labour force, according to T&T’s Central Statistical Office. 2014 was a particularly good year for the sector, which grew by 7.1%, outperforming the wider economy for a second consecutive year. In 2015, the energy-related construction sector is expected to feel the effects of the downturn in oil and gas prices, though public sector building and demand for infrastructure works are likely to remain strong. Meanwhile, in the real estate sector, the political uncertainty arising from the forthcoming election is likely to put a damper on the volume of transactions and have a slight effect on prices, while the supply of affordable housing for low- and middle-income families is expected to remain below pent-up demand through 2015 and 2016. This chapter contains an interview with Roodal Moonilal, Minister of Housing and Urban Development.