Jun 2016 Financial News

RBL managing director: T&T not in economic crisis

Jun 20, 2016

A leading local bank says the challenges facing the local economy are not severe enough to classify this country as being in a crisis.

Nigel Baptiste, managing director, Republic Bank Limited (RBL), said while the dynamics in the energy sector were not as buoyant as they were more than a year ago, the economic environment remains stable. He explained that the Treasury was still earning revenue from oil and gas and growth in the manufacturing sector through exports was generating much needed foreign exchange.

In addition, he said, expansion of the services sector was providing Government with a lot more wiggle room. However, the attitude of T&T’s workforce needs to improve to ensure greater productivity and citizens should have no illusions about the length of time required to achieve economic diversification.

“Diversification cannot be rushed and diversification is never going to increase the share of the non-energy sector by more than four or five percentage points, so what we need to focus more on is productivity in our existing non-energy sector. We will get considerably more percentage points from that,” Baptiste said.

“I am really just talking about the existing operations of companies, looking to see how we can improve the efficiency of these operations, either through the use of technology or getting more out of our existing workforce. Those would be two of the prime areas I would look at initially.”

“Cultural change means different things to different people, but I certainly think if we look inward first and see how we can enhance our existing operations, how we can get more out of the employees that we have working with us right now—whether it is a cultural change, whether it is that we create an environment that enables them to do more with the resources which we are making available for them.”

Baptiste said foreign exchange challenges continued to affect individual and corporate customers and will be resolved anytime soon, although the situation has improved somewhat.

He said while customers are not getting all the foreign currency they wanted now, they are accessing more than was available to them previously and the tweaked system affords greater regularity as well as an ability to predict what is going to happen.

This allows businesses to rationalise their operations in accordance with what their expectations are.

“The greatest challenge to any business is uncertainty and the lack of information. Once you can improve that level of knowledge, people are then able to plan better; people are than able to organise their business better.

“So what we have now, we more or less know every two weeks this amount of US dollars will come in. Before, I wasn’t sure if it would come in…when it would come in.

“I wasn’t sure what to tell my suppliers, what to tell myself, what to tell my employees. Now I could tell them okay fine, in two weeks time I might get something,” Baptiste said.

“It wouldn’t be the US$100,000 which is what I wanted, but I know that I might get something, so that ability to reduce the uncertainty is what is going to help and what has been helping, I think, so far in the foreign exchange market and to the extent that we could reduce some of that uncertainty in the wider economy would also help.”

Source:
SEAN NERO
Trinidad Guardian
Monday June 20, 2016

http://www.guardian.co.tt/business/2016-06-20/rbl-managing-director-tt%E2%80%88not-economic-crisis