Trinidad and Tobago: Economic Outline
For the latest updates on the key economic responses from governments to address the economic impact of the COVID-19 pandemic, please consult the IMF's policy tracking platform Policy Responses to COVID-19.
Trinidad and Tobago is heavily dependent on the production of energy and hydrocarbon exports. According to updated IMF forecasts, GDP grew by an estimated 2.5% in 2022, mainly driven by petrochemical exports and rising tourist arrivals. In 2023, growth should continue to be supported by elevated energy prices, although it may be somewhat tempered by inflation and fiscal prudence. The IMF estimates that growth should pick up to 3.2% in 2023 before slowing down to 2.3% in 2024. The country will have to put in place a big effort to diversify its economy, as existing sites saw their production level decline, while the unfavourable situation in Venezuela is impacting the refining industry.
The IMF calculated 2022 gross debt at 53.8%, with 53.9% and 54.2% forecasted for 2023 and 2024, respectively. It is mainly denominated in TTD and around four-fifths of it are held domestically. The public balance is historically negative, although it has been reducing in recent years as the rise in energy exports has increased government revenues, and it reached -0.2% in 2022. Looking ahead, the government's planned tax reforms, including the creation of a new property tax, should reduce fiscal deficit. Inflation stood at 5.8% in 2022, and should decrease to 5.6% in 2023 and to 3.4% in 2024, due to the tightening of monetary policy and extended fuel subsidies, according to the latest World Economic Outlook of the IMF. The twin island state of Trinidad and Tobago is a small but high-income country with one of the highest per capita incomes in Latin America and the Caribbean. Trinidad and Tobago has a sophisticated economy for a country of its size, embracing mineral extraction, agriculture, industry, tourism and services, but it is underpinned by a single commodity: oil. Petroleum and petrochemical industries account for about 35% of GDP while ores and mineral account for over 80% of exports. The country has also become a major financial centre in the Caribbean. Diversifying the economy remains the main challenge the country will have to face in the next years. A host of other factors, including low labour productivity, inefficient government bureaucracy and corruption have hampered economic development.
According to the last available data, the IMF estimated the country's unemployment rate around 4.5% in 2021. However, the informal sector is still developed. Social issues include an ageing population, low labour participation rate, insufficient job creation, low labour productivity, difficulties to open a business and unmanaged migration, as well as poverty (20% of the population is living below the poverty line), inequality and one of the highest crime rates in the world.
| Main Indicators | 2020 | 2021 | 2022 (E) | 2023 (E) | 2024 (E) |
|---|---|---|---|---|---|
| GDP (billions USD) | 21.06 | 24.46 | 27.88 | 28.22 | 29.49 |
| GDP (Constant Prices, Annual % Change) | -7.7 | -1.0 | 2.5 | 3.2 | 2.3 |
| GDP per Capita (USD) | 15,048 | 17,387 | 19,718 | 19,858 | 20,649 |
| General Government Gross Debt (in % of GDP) | 60.0 | 59.9 | 53.8 | 53.9 | 54.2 |
| Inflation Rate (%) | 0.6 | 2.1 | 5.8 | 5.6 | 3.4 |
| Current Account (billions USD) | -1.36 | 2.90 | 5.26 | 1.87 | 2.11 |
| Current Account (in % of GDP) | -6.4 | 11.9 | 18.9 | 6.6 | 7.1 |
Source: IMF – World Economic Outlook Database - October 2021.
Note: (e) Estimated Data
| Monetary Indicators | 2016 | 2017 | 2018 | 2019 | 2020 |
|---|---|---|---|---|---|
| Trinidad and Tobago Dollar (TTD) - Average Annual Exchange Rate For 1 GBP | 9.00 | 8.73 | 9.03 | 8.50 | 8.66 |
Source: World Bank - Latest available data.
| Breakdown of Economic Activity By Sector | Agriculture | Industry | Services |
|---|---|---|---|
| Employment By Sector (in % of Total Employment) | 3.0 | 26.6 | 70.3 |
| Value Added (in % of GDP) | 1.0 | 42.2 | 54.0 |
| Value Added (Annual % Change) | -16.5 | -1.0 | -2.0 |
Source: World Bank - Latest available data.
| 2018 | 2019 | 2020 | |
|---|---|---|---|
| Labour Force | 669,487 | 668,956 | 636,888 |
Source: International Labour Organization, ILOSTAT database
| 2017 | 2018 | 2019 | |
|---|---|---|---|
| Total activity rate | 68.85% | 68.73% | 68.59% |
| Men activity rate | 79.53% | 79.42% | 79.26% |
| Women activity rate | 58.28% | 58.15% | 58.04% |
Source: International Labour Organization, ILOSTAT database
The Economic freedom index measure ten components of economic freedom, grouped into four broad categories or pillars of economic freedom: Rule of Law (property rights, freedom from corruption); Limited Government (fiscal freedom, government spending); Regulatory Efficiency (business freedom, labour freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom). Each of the freedoms within these four broad categories is individually scored on a scale of 0 to 100. A country’s overall economic freedom score is a simple average of its scores on the 10 individual freedoms.
Economic freedom in the world (interactive map)
Source: Index of Economic Freedom, Heritage Foundation
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The Indicator of Political Freedom provides an annual evaluation of the state of freedom in a country as experienced by individuals. The survey measures freedom according to two broad categories: political rights and civil liberties. The ratings process is based on a checklist of 10 political rights questions (on Electoral Process, Political Pluralism and Participation, Functioning of Government) and 15 civil liberties questions (on Freedom of Expression, Belief, Associational and Organizational Rights, Rule of Law, Personal Autonomy and Individual Rights). Scores are awarded to each of these questions on a scale of 0 to 4, where a score of 0 represents the smallest degree and 4 the greatest degree of rights or liberties present. The total score awarded to the political rights and civil liberties checklist determines the political rights and civil liberties rating. Each rating of 1 through 7, with 1 representing the highest and 7 the lowest level of freedom, corresponds to a range of total scores.
Political freedom in the world (interactive map)
Source: Freedom in the World Report, Freedom House
The world rankings, published annually, measures violations of press freedom worldwide. It reflects the degree of freedom enjoyed by journalists, the media and digital citizens of each country and the means used by states to respect and uphold this freedom. Finally, a note and a position are assigned to each country. To compile this index, Reporters Without Borders (RWB) prepared a questionnaire incorporating the main criteria (44 in total) to assess the situation of press freedom in a given country. This questionnaire was sent to partner organisations,150 RWB correspondents, journalists, researchers, jurists and human rights activists. It includes every kind of direct attacks against journalists and digital citizens (murders, imprisonment, assault, threats, etc.) or against the media (censorship, confiscation, searches and harassment etc.).
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Latest Update: September 2023
