The Trinidad and Tobago Manufacturers’ Association (TTMA) said yesterday that it is dissatisfied with the continued struggle faced by member companies in accessing foreign exchange for business operations.
“The situation is further exacerbated, as the association and the general public were advised that this anomaly would have been regularised by the end of February 2014. TTMA is informed by its members that the situation continues unabated, with commercial banks maintaining a queuing system and, even then, banks are only able to supply a small percentage of the requirements of local manufacturers’ needs,” the TTMA said in a release.
The unavailability of foreign exchange has resulted in the inability of manufacturers to meet their financial obligations to foreign suppliers, it said, and if the situation continues it will adversely impact manufacturers’ credit ratings with suppliers, as well as overall competitiveness, and, ultimately, business employment levels, since not being able to secure foreign exchange to procure raw material will negatively impact production, the association said.
“Such a situation cannot persist, as it will destroy the non-oil manufacturing sector, which serves as the catalyst for the diversification of the economy of Trinidad and Tobago,” the TTMA said.
The TTMA said it noted that the International Monetary Fund (IMF) recently concluded an Article IV Consultation in Port of Spain, with sound warnings that uncertainty in the local foreign exchange market encourages hoarding.
The IMF stated that “the foreign exchange market has been relatively tight recently. Despite significant dollar injections from the Central Bank of T&T (CBTT), recent reports suggest that foreign exchange shortages, while temporary, have been fairly widespread”.
This “warning” by the IMF should be taken since it corroborates the findings of the TTMA where these very concerns are raised and voiced almost on a daily basis, the Association said.
“The TTMA has communicated repeatedly with the Ministry of Finance and the Economy, the Central Bank of Trinidad and Tobago and the Bankers’ Association on this matter in 2014, however, the problem prevails. We are again calling on the relevant authorities to evaluate the root cause of this problem so as to ensure the development of predictable long-term solutions in the best interest of the Trinidad and Tobago economy,” the TTMA concluded.