Life after covid19 will involve a return to some degree of normalcy, but improvements can be made. It was with this in mind that the TTMA launched its Manufacturing Export Strategy 2025 on June 17.
TTMA president Franka Costelloe, speaking at the virtual launch, said the strategy was built on seven key factors including advocacy for an enabling business environment; identification of demand regionally and internationally; developing the supply capacity of local suppliers; facilitating access to fit-for-purpose manufacturing infrastructure, including shared production and distribution mechanisms; labour; technology and innovation; and access to capital and financing.
She said the implantation of the plan in 2020 would involve three phases to stabilise, strengthen and secure the manufacturing sector. She said there had been a 60 per cent drop in the export figure between January – April 2020 compared to the same period in 2019.
The unavailability of foreign exchange has been a driving force behind the development of strategy so that businesses can become sustainable on this front. Costelloe said, through the Exim Bank facility, 53 companies had received foreign exchange (forex) and had a 15 per cent increase in exports from 2017 to 2020. She said the increase showed that availability of forex drives manufacturing. She urged businesses to procure locally to reduce demand for forex.
Costelloe said it was an ideal time for companies to transition to digital 4.0 which involved increasing business efficiency through digital and contactless manufacturing. She said the transition was not limited to equipment but included software and e-commerce. She said small and medium enterprises (SMEs) were best able to adapt to digital 4.0 and the association would be offering SMEs a webinar and training during the upcoming trade and investment conference (TIC).
While SMEs have been most at risk for closure during the lockdown, there have been an upsurge in SMEs signing up for membership. Costelloe said many SMEs had sought ways to become more efficient during the stay-at-home period, and there had been a spike in the number of businesses manufacturing personnel protective equipment such as masks and face shields.
Speaking at the launch, Trade and Industry Minister Paula Gopee-Scoon said Government was working on several initiatives to improve the ease of doing business, guided by the 12 indicators in the World Bank’s Doing Business 2020 report. She said those included the single electronic window, the Automated Construction Permitting System (ACPS), branding DevelopTT, upgrading of the Asycuda system, a thrust towards e-government and others.
She said given the potential of the manufacturing sector to drive further economic transformation, the Ministry of Trade and Industry has recently developed a National Manufacturing Policy for TT for the period 2020-2025, which was shared with the TTMA for inclusion in their strategic plan.
“Essentially, what we have now done, is harmonise the private and public sector approaches unifying us in purpose, with the end result being a Strategic Framework for the Expansion of the Manufacturing Sector.”
Gopee-Scoon said the major objectives of the Strategic Framework are to expand export growth and create more knowledge-intensive industries; development of new and higher value added products; enhance human resource capacity in the sector; improve production capacity through research, development and innovation; improve access to finance, particularly for micro, small and medium enterprises (MSMEs) in the sector; and strengthen administrative and institutional mechanisms.
She said Government was focused on revamping the Exim Bank to become the main bank for manufacturers, particularly for SMEs. Government wants the bank to offer more than support for raw materials.
Gopee-Scoon said her ministry was also exploring having exporTT offer co-financing arrangements for smaller manufacturers, improved pricing and involvement in grant funding for products.
Costelloe said SMEs were the next generation of business and bigger companies need to partner in the thrust for a stronger, sustainable non-energy sector. Currently 20 of 1,154 companies represent $2.9 billion or 80 per cent of exports. The TTMA believes the manufacturers among its 890 SMEs can increase that number. So by 2025, there should be 40 companies contributing $4 billion in export.
Costelloe said the TTMA would continue to push hard for digitisation of government systems including improving access to capital for SMEs through the support of angel investing, venture capital, private equity, and junior stock exchange for manufacturing entities that allow investors to have exit strategies.
She said the TTMA would be investing in an online platform for MSME members to be exposed to interested investors.