Manufacturing and Retail Distribution
October 26th, 2020
Trinidad and Tobago Manufacturers’ Association (TTMA) views the challenges brought by this pandemic as an opportunity to stabilise, strengthen and secure the position of the manufacturing sector.
What does COVID-19 mean for the future of the manufacturing and retail distribution industry?
2020 will be infamously remembered as the year of the COVID-19 pandemic which politically, economically and socially, rocked the world. However, Trinidad and Tobago Manufacturers’ Association (TTMA) views the challenges brought by this pandemic as an opportunity to stabilise, strengthen and secure the position of the manufacturing sector.
A Snapshot of the Economy before COVID-19
Some highlights of Trinidad and Tobago’s economy in 2019 are provided below:
- Non-energy manufacturing exports represented 5% (or $3.61 billion) of total exports.1
- 73% of those exports were sold in the CARICOM market.
- 48,900 persons were employed in the manufacturing sector, an increase of 600 persons from 2018 (Source: Central Bank)
- 1,853 STEM graduates, an increase of 109 persons from 2018 (Source: UTT and UWI Statistics)
- 44 manufacturing graduates, an increase of 11 persons from 2018 (Source: UTT Statistics)
COVID-19: The Teacher
A number of lessons from the pandemic can be identified, but several of those lessons revolved around the most important resource of any company – the human resource. Thus, there was a great emphasis on ensuring employee safety while maintaining the successful operations of the business. During the Government’s stay-at-home directive, several companies employed digital technologies which allowed employees to work from home.
Another lesson was adaptability. In response to the pandemic, various trade facilitation measures were implemented by State agencies to minimise the economic impact on companies, including the waiver of port rent and demurrage fees, and decreased clearance times by Customs and Excise Division for items deemed to be essential.
Additionally, the Government approved the injection of additional foreign exchange into the Export Import Bank of Trinidad and Tobago Limited (EXIMBANK) – for manufacturers and distributors –
so that there would be no shortage of essential items in the local market.
Clean Working Environments
One of the main lessons learnt was that business operations need to be kept clean in order to curb the spread of the virus. In summary, the following protocols must be adhered to:
- Physical distancing – employees and visitors must practise physical distancing at all times. To assist in maintaining this distance, markers should be used. Online meetings should be encouraged. The workstations of employees who interact with the public should be shielded.
- Office sanitisation – there should be a cleaning schedule for the office, especially for regularly touched surfaces, shared spaces, and shared vehicles.
- Personal hygiene – running water with soap and paper towels, and/or sanitisers should be provided by the company for employees and visitors. Companies should encourage hand washing and/or sanitisation via proper signage. Also, persons entering a company’s building should be encouraged to use masks.
Manufacturers that were deemed “essential” by the manufacturing sector were allowed to operate during the lockdown period while adhering to the health and safety guidelines. These companies accounted for over 200 companies in the TTMA’s membership. The fact that there were no additions to the number of cases of COVID-19 in the country from the manufacturing sector operating during this time, attests to the high standard of safety employed by the sector. This evidence assisted the TTMA in securing an earlier reopening for the rest of the manufacturing sector than was previously proposed by the Government.
Furthermore, to assist SMEs in their back-to-work preparation, the TTMA provided PPE to manufacturers – face shields, face masks, social distancing stickers, sanitising stations, hand sanitiser and proper signage.
Innovations Were Also Bred
One phrase that captures the response of manufacturers is ‘Breaking Boundaries’, the theme for the 2020 edition of the Trade and Investment Convention. Specifically, two highly demanded products were commercially produced in response to COVID-19 – face masks and face shields. These innovations complemented the already-existing local production of PPE, including hand sanitisers and disinfectants; garments; and gloves.
Investment in the Post-COVID Environment
The investment climate, as with other components of the economy, would have felt the effects of COVID-19. However, local and foreign-based investors would be pleased to know that the TTMA’s Manufacturing Strategy was launched in June 2020. The strategy is built on a foundation of private sector initiatives that are intended to strengthen the domestic market and to reverse the downward-moving export trend. The five-year plan is also intended to insulate Trinidad and Tobago from the cyclical shocks of the oil and gas industry.
This strategy is divided into three phases with the objectives of stabilising, strengthening, and securing the manufacturing sector. The following are the phases of the Strategy:
- Stabilising the domestic market through existing initiatives and working aggressively with the membership base, especially the SMEs, to get trade back to levels achieved in December 2019, valued at $3.2 billion.
- Strengthening the base. The manufacturing sector will seek to recapture and recover its pre-COVID-19 export market share through digital networking and connection with buyers, leveraging technology to build new relationships and facilitating the strengthening of existing relationships.
- Refocusing the manufacturing sector’s attention on growing exports by targeting and securing new markets. The objective is to grow exports in ways that reduce reliance on the public sector for foreign exchange, and which foster the diversification of the economy.
It is anticipated that the manufacturing sector will grow and flourish due to the initiatives of this strategy, which will greatly improve the investment climate of Trinidad and Tobago.
Embracing the New Normal
COVID-19 affected the local economy and business operations in different ways, but local businesses have responded and are adapting to the new normal. Manufacturers diversified their product offerings, and are ensuring that the workplace is safe. Economic development will continue, and the Government’s trade policy and new industrial parks are initiatives that investors can look forward to benefiting from. To conclude, the new normal is here, and Trinidad and Tobago’s businesses are embracing it.
1 The determination of the value for non-energy manufacturing exports starts with the total domestic exports value from CSO, followed by the removal of energy and primary products exports, including but not limited to pig iron, iron ore and concentrate, and non-ferrous metal, scrap.