Competitiveness in small, open, mineral-based economies : the case of Trinidad and Tobago

Abstract

This study recognises that small, open economies face an urgent need to achieve global competitiveness in the context of a rapidly globalizing 21 st century, given high import propensities and significant dependence on rapidly disappearing preferential markets. The chapter examines the links between the hydrocarbon and non-hydrocarbon sectors in the economy of Trinidad and Tobago and reviews empirical trends in both sectors in four periods between 1945 and 2003. One conclusion that emerges from the study is that there were negative impacts arising from a growing hydrocarbon sector on the rest of the economy. The study also describes current government policies aimed at promoting competitiveness in the non-hydrocarbon sector, intended to usher in a more balanced economy, and concludes that these do not go far enough in terms of recognition of the macroeconomic demands for realizing the desired diversification.