AmChamTT: Reform needed to attract US investors

PRESIDENT of the American Chamber of Commerce TT (AmChamTT) Patricia Ghany says TT must make a greater effort to become investor-friendly and improve its ease of doing business if it is to capitalise on a strategy set out by the United States, its largest trade partner, to promote investment in the western hemisphere.

Ghany was speaking at the chamber’s annual post-budget forum at the Hilton Trinidad on Wednesday. Stakeholders from AmChamTT recently visited the US capital, Washington, DC, where they met with senior officials from a number of state arms, including the National Security Council, State Department, Senate, Congress and other arms of the US Government.

Ghany warned that the US, unlike other countries, has a strategy that rests on the ability of its private sector to be able “to find opportunities (overseas) and then access some support from government institutions, as opposed to the government cutting deals directly.”

She said the US has made its investment strategy a reality through reformatting and renaming the Overseas Private Investment Corporation – the US government’s development finance institution, which mobilises private capital in order to advance US foreign policy and national security objectives.

The corporation was recently recapitalised from US$30 billion to $60 billion, a development she said TT should take notice of.

“Why am I raising this in the context of our national budget? Well, to not be left behind, we must do more to become investor friendly and improve our ease of doing business. We also must have an underlying strategy and the will to make it a reality. So doing away with paper immigration forms is a great start but it’s just the tip of the iceberg. We need structural reforms. We need them now. We need them urgently,” said Ghany.

She also discouraged needless spending by the government, saying the idea that it will lift the economy is unsubstantiated. “Indeed, the opposite may be true. Continuing to fund non-productive sectors of the economy and inefficiencies in various parts of the value chain only makes it harder for productive activities to flourish.

“...simply put, by spending money on things that don’t generate revenue and by funding systems that are inefficient, it is harder for income-generating activities and initiatives to bear fruit.” She said it was imprudent to increase borrowing from $41.7 billion in 2008 to $84.1 billion in 2015 during a period of increased revenue.

“Just as that was not prudent, it is not prudent now to expand the budget by some $3 billion while revenue remains depressed. With some $5 billion of last year’s revenue coming from one-off sources,” Ghany added, “we encourage restraint on spending this year unless the revenue assumptions are realised.”

The chamber called on the government and opposition to develop and adopt a legislative framework to improve the ease of doing business locally and “to get it done in a manner that, as far as is possible, insulates the new institution from political interference and protects our rights to privacy.”

She said: “This is not an issue over which either party should be seeking to score cheap political points. We urgently need reform of our tax collection agency.”

Offering other solutions, Ghany added that the implementation of procurement legislation with regulations covering the disposal of government land and government-to-government contracts and an e-registry of public contracts will help fight corruption and improve the value derived from government spending.

There are many other factors to consider in terms of promoting ease of doing business in TT, according to Ghany, including the improvement of an effective justice system, a digital transformation of the public sector, a national open data policy to make government data available online, policies governing Blockchain, and adoption of crypto-currencies, among others.