What makes a country competitive?
Well, according to the World Economic Forum's (WEF) Global Competitive Index (GCI), that's a question Trinidad and Tobago is still trying to figure out.
"To be competitive as a society, you have to have competitive firms. And to have competitive firms, you need an enabling environment that allows them to spread their wings to do what investors and entrepreneurs do best," said Dr Rolph Balgobin, independent senator and corporate turnaround specialist.
"If you can create that environment, while you can measure the performance of the whole economy as national entities, competitiveness, and global competitiveness in particular, really happens at the level of the firm," he added, noting that firms are competitive, not the country.
Dr Balgobin presented the latest results of the GCI last Wednesday at the Arthur Lok Jack Graduate School of Business at Mt Hope.
Trinidad and Tobago slipped three spots from last year, to come in at 84 out of 144 countries.
The annual ranking is based on the Global Economic Index developed by the WEF.
Rankings are calculated using publicly available data and an executive opinion survey.
The results showed the most problematic factors for doing business in Trinidad and Tobago were inefficient government bureaucracy; crime and theft; poor work ethic in the national labour force; corruption; and access to financing.
"Our institutions need strengthening. The scores reflect that our institutions are weak and our capacity for innovation and innovative processes is too low. We do not do well in starting a business and developing entrepreneurial conditions; the Customs burden is not very good. These are all policy issues Trinidad and Tobago has to address," he said.
Balgobin noted that in the last five years, the same problems that proved a deterrent for doing business have not changed.
"We can conclude that we need to make progress. These things may take time. But the most disturbing thing is policymakers may not be clear about the role of business in society because they have not clarified that in their minds. They do not understand business has a major role in societal and economic development to the extent that governments strangle business and allow them to operate on a fairly primitive level. They in fact stunt or preclude competitive development," he said.
Balgobin highlighted the fact that, in relative terms, even though T&T has had a fairly consistent average score of 4.0, the country's ranking is slipping.
"As fast as the survey has increased (participants) our ranking has steadily dropped. Since 2001 we've added 69 new countries and our ranking has dropped 46 places. A simplification is that out of the 69, 46 debuted above us," he said.
Balgobin noted that with a 4.0 score, Trinidad and Tobago is very firmly positioned in the middle.
The ranking placed Trinidad and Tobago as a transitioning economy moving from efficiency driven to innovation driven.
"Advanced economies put a major emphasis on innovation sectors. Extractive economies—like ours—have very low levels of innovation and a greater emphasis on basic requirements.
"Innovation in the more advanced economy is linked to higher incomes and higher standards of living. The level of econ activity we engage in is fairly basic— a lack of innovation," he said.
Citizens also appear to have a significant trust issue in terms of society engaging with the political class.
"The rankings show a clear sense that people don't trust in the government—any government. Trust in politicians is low and that is reinforced with the view that regarding competition, government makes decisions in a way that is not always transparent," he said.
"The promise that we had in 2001 (when T&T ranked 37 out of 75) ten years later has not manifested. There are many countries that started way behind us, particularly in Latin America, that have overtaken us—by leaps and bounds in fact," he added.