Trinidad and Tobago: Island Market for U.S. Exports

The tropical country of Trinidad and Tobago, a longtime market for U.S. grains and oilseeds, is now providing expanding opportunities for U.S. consumer-oriented exports.

Just northeast of Venezuela between the Caribbean Sea and Atlantic Ocean, this tiny two-island nation has more than proximity in common with its closest neighbor. A dependence on oil and gas revenues has left its economy vulnerable to the volatility of the petroleum marketplace.

In 1996, gas and oil sales accounted for roughly half of the country's total exports, with other petrochemical products contributing an additional one-fourth.

Though strong and growing, with a 3.1-percent gross domestic product in 1996, the government of Trinidad and Tobago has devised trade liberalization plans to lessen the country's reliance on oil and gas. Part of the diversification policy has included liberalizing the import regime.

Island government statistics for 1996 show agricultural imports of $221 million, which account for 13 percent of all island imports. During this year, the United States exported $137 million worth of agricultural, fish and forestry products to the islands.

Topping the list of island food imports from all sources were dairy products, cereals, cereal preparations, fruits, vegetables, oilseeds and miscellaneous food preparations.

Consumer-oriented agricultural products comprised 16 percent of all U.S. agricultural exports to Trinidad and Tobago in 1996. Posting biggest gains for U.S. exporters in this category: snacks, cereals, dairy and egg products and tree nuts.

Since domestic crops (and exports) are limited mainly to sugar cane and cocoa, the local economy has always had to import food products to meet consumer needs and the ingredients needed by a thriving food processing industry.

Because of the dependence on imports, the government has imposed few trade restrictions on consumer-ready food products. And with increasing liberalization, tariffs are being progressively lowered from the past average of 30 percent.

On Jan. 1, 1995, the government completely eliminated the tariff on many processed food products, thus putting more U.S. high-value products within financial reach of a large proportion of the islands' consumers.

U.S. beef and pork exports stand to benefit from the lower tariffs. Not much growth is predicted for poultry, as production is well developed in the islands. But domestic chickens do eat imported feeds.

U.S. consumer-ready products find ready acceptance and recognition for several reasons. Geographic nearness, the influence of U.S. popular culture and high-quality foods at a fair price combined with ongoing, good relations between the two countries add up to good trading partners and neighbors.

The islands' flourishing middle class includes many women who work outside the home, increasing the demand for consumer- ready and convenience foods.

The islands' two predominant ethnic groups--African and East Indian--have contributed to a cuisine that favors Caribbean and Asian foods. Religious traditions also influence certain food choices. Trinidadian popular culture exhibits a notable joie de vivre, which spills over into the foods eaten and how money is spent.

The government of the two islands would like to expand tourism, particularly on Tobago, which would greatly increase the demand for U.S. goods. Trinidad already has a small but stable restaurant sector that would increase with tourism growth. Diversification plans include expansion of the island's hotel infrastructure.

Domestic food processors lead the competition confronting U.S. exporters, followed by other Caribbean countries and Canada. Foods produced on the islands are typical Caribbean fare that include hot sauces and jams, chicken and pasta.

These local businesses also export a number of high-quality products: cereals, cereal preparations, sugar, sugar preparations, honey and beverages. They have been so successful that other Caribbean countries have taken protectionist measures to limit imports of these high-quality, price-competitive processed foods and beverages.

While Venezuela provides a quantity of fresh fruit and vegetables to the islands, it's not a significant competitor in consumer-ready or high-value product categories.

The distribution system in Trinidad and Tobago is well developed and easily meets the needs of sophisticated consumers. Products are flown in or shipped to the two maritime ports.

Modern supermarkets carry a wide variety of imported foods. Consumers purchase most of their food in supermarkets, although farmers markets still are popular, particularly in rural areas.

Agricultural imports	$221 million
Ag imports as percent of total imports	13 percent
U.S. market share of ag imports	$137 million
Total population	1.3 million
Population growth rate	0.08 percent
Percent of women employed	61 percent
Per capita income	$4,288

The author is agricultural counselor at FAS' Office of Agricultural Affairs in Caracas, Venezuela. Tel.: (011-58-2) 977-0015; Fax: (011-58-2) 977-1689; Email: AgCaracas_PO@fas.usda.gov.