“Jamaica Trade Desk News” Theme: Remapping export development in light of globalisation! Contact us at (868) 675-8862 Ext. 239 M O N T H L Y
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Email: tradeassist@ttma.com I S S U E
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SMEs: Breaking into the trade game…! With larger markets, the company benefits from economies of scale when they can purchase raw materials in larger quantities and at better price, than having to purchase their raw materials in smaller quantities. HIGHLIGHT FOREIGN TRADE
The next significant foreign trade benefit for SMEs is the knowledge gain. By entering the international market, a company can gain various experiences which can be used to improve both its local and foreign businesses. It can gain information on new technologies, new product and marketing ideas, and much more.
EXPOSURE & EXPORT ORIENTATION GROWTH: SMEs: Breaking into the trade game…. INSIDE THIS ISSUE:
Go beyond our barriers! How distinct are small States from larger ones?
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Doing business with Trinidad & Tobago... Make TT your next investment choice!
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Cost of doing business in TT!
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How to import meat products in Trinidad and Tobago?
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Mapping the creative industries! Caribbean Export 5 supports the creative industries...
TIC 2014: offering B2B matchmaking!
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Contact JA-T&T Trade Facilitation Desk NOW!!!
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In some ways, entrepreneurs have the perception that a SME does not export, but driving export is key to growing an SME. While many exciting business opportunities lie overseas, many SMEs are daunted by bureaucracy and regulations that are required by the foreign market, and usually put their export plans on the back burner. Entrepreneurs likely think that companies that are going international should be large, because of the perception that it requires huge capital expenditure. But in reality, a significant percentage of exporters are SMEs, therefore the size of the firm is not important. The success of a small business in the exporting industry is dependent on the quality, competitive pricing, the ability to supply products on a regular and timely basis. Despite the risks involved, which are actually part of any type of business, exporting brings significant benefits to SMEs. Most SMEs start with the local market first before going into exporting to develop their capacity. By achieving domestic success they will attain the background knowledge and experience needed to break into foreign markets. Without a good level of success in their home markets, firms will be unlikely to achieve success abroad. Exporting increases your market share and enables the company to earn better prices and foreign exchange. The additional profit earned from exports can be used to keep your plant and equipment updated to international standards. Another distinct advantage of exporting to a larger market is the lower cost of production. With the increase of raw materials needed for a wider target market, the cost of production per unit of product should decrease.
Diversifying risks is one more advantage of exporting. With the company's expansion to other countries, risks such as economic downfall and market changes are more evenly distributed. While domestic companies may be wholly affected if misfortune hits the domestic market, a company with foreign interests will not suffer such great losses. A small business can also benefit from selling its excess products internationally. If the company exports its goods, it does not have to give enormous discounts to its local market and excess products can be sold to other markets that are not so important to the long term future. And lastly, exporting can extend the life cycle of a product. A typical product has a life cycle of launch - growth - maturity - decline. An exporting business is able to extend these stages and the lifetime of its products by launching it to new export markets, while the domestic market is still maturing. As a result your entire product cycle becomes self-sufficient and reduces the financial strain on your business. With these benefits that are derived from exporting, owners of SMEs should consider tapping the regional and international market. The size of your business is irrelevant; what matters is the will to succeed in the export markets, high quality and useful products, and a good entrepreneur who is a strategic risk taker! Article by Naika Pichi-Ayers, TTMA Jamaica-TT Trade Facilitation Desk Officer. She can be reached at (868) 675-8862 Ext. 239 Email: tradeassist@ttma.com
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How distinct are small States from larger ones? Smallness and vulnerability have been linked to the Caribbean in both academic and political circles. In WTO negotiations, it has been argued that special and differential treatment (such as provisions requiring all WTO members to safeguard the trade interests of developing countries) be afforded by large states towards small and vulnerable economies. Such treatment would auger well for manufacturers in small states. However, there is the counter-argument that there is no reason for offering such treatment, as there is no distinction between small states and large states. This counter-argument begs the question – how distinct are small states from larger ones? Those which argue that there is little distinction, can reference the following arguments: In the Global Competitive Index 2013-2014, there were some small states which scored well (in excess of 5 out of a total of 7), and even more which ranked highly (within the top 25%). In the Human Development Index (HDI) 2012, there were several small states which were ranked within the top 25% (including Barbados). These states are defined as having “very high human development” by the UNDP. According to the World Bank, several small states are classified as either high income countries or upper middle income countries (this classification is based on the GDP per capita of the country). While some large states experienced negative growth over the past five years, several small states have experienced positive growth for the same period. However, one cannot deny the unique characteristics of small states. There are five characteristics of small states. These are openness, enclaveness, resilience, weakness and dependence. With specific reference to openness and dependence:
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The limited opportunities for trade in the domestic market, as well as the limited resources which are available, force small states to utilise international trade. In other words, the propensity to import in small states is much greater than in larger states. Additionally, these states only specialise in a limited number of goods (i.e. there is limited diversification). This openness renders small states to be vulnerable. Small states benefit greatly from foreign economies. There is a reliance on invisible income (such as remittances), development assistance (from bodies such as the International Monetary Fund), and preferential trade (as was granted via the Lomé conventions of the European Union, and is currently granted via the Caribbean Basin Economic Recovery Act of the United States of America).
Issues such as a small market size, and a lack of human resources and financial resources, are hardly found in larger states, but are more frequently found in smaller states. The argument of vulnerability (whether economic, geographical or otherwise), has most certainly been used by small states. The term “small, vulnerable economies” has already been coined, and countries have been classified accordingly. Thus, it can be argued that while the small states are similar to large states, there are attributes that differentiate them from their larger counterparts. However, large states are yet to accept this classification as reality, since various indicators suggest that there is little difference between small states and large states. ___________________________________________
¹In the literature, six characteristics are identified (the 6th characteristic being “islandness”). However, such literature focuses on small island developing states, as opposed to small states. Thus, the islandness characteristic was removed.
Contribution from Mr. Christian George, TTMA Research Officer, Trade Unit. Mr. George can be reached at (868) 675-8862 Ext. 225 or via email at: trade@ttma.com
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Invest in Trinidad & Tobago… TOP 5 REASONS TO INVEST IN T&T 1. 8th lowest energy cost in the world 2. Strategic location as a trans-shipment hub
Trinidad and Tobago is a solid investment choice, offering any advantages and business support in Agri-Business, Clean Technology, Creative Industries, Financial Services, ICT, Maritime Industries and Tourism. Over 400 international operations are already established in our robust economy which has remained stable despite fluctuations in world markets. Trinidad and Tobago has a friendly business climate and a welcome that’s warmer thatn the Caribbean Sun.
3. Access to 1 billion regional and nearshore customers through trade agreements
Call InvesTT now. They are your first point of contact for seeking out investment opportunities and have the expertise to provide you with an efficient and rewarding business experience.
4. A highly developed communications infrastructure
Make Trinidad and next investment choice.
5. Educated, skilled and competitive labour force.
Visit www.investt.co.tt or call them at: +1 (868) 638-0038
Tobago your
Cost of doing business in T&T! Businesses in Trinidad & Tobago enjoy highly competitive operating costs, making the country an emerging market for e-business and technology firms. The strength of the nation’s energy industry makes it able to boast of some of the lowest energy costs in the world. Any person wishing to incorporate a company in Trinidad & Tobago is required by law to register the business as a sole proprietorship, partnership or limited liability company. All employees, sole traders, partnerships or companies are legally obligated to apply for a Board of Inland Revenue (BIR) file number to be used in payment of taxes or filing of returns. Corporation tax is fixed at a low rate of 25% and a Value Added Tax (VAT) of 15% is applied to both goods and services in Trinidad & Tobago. A foreign national wishing to work in the country must apply for a work permit through the Ministry of National Security. Tax & Wages Corporate Income tax rate – 25% Personal income tax rate – 25% Average wage earnings for high level occupation groupings - US$60,000 per annum Minimum wage - TT$12.50 per hour (approx. US$1.95)
Operational Costs Average cost of electricity (per kWh for businesses) 1. Commercial - US$0.09/TT$0.61 2. Industrial US$0.03/TT$0.22 3. Heavy Industrial - US$0.02/TT$0.15 ** Industrial customers are required to specify the planned Maximum Demand of their plant in kVA (the Reserve Capacity) when requesting a supply. Average cost of water for businesses Industrial and Commercial Unmetered - US$37.32/ TT$237 per month Industrial and Commercial Metered - 50% of water bill Average cost of Transportation Fuel - US$0.62/ TT$4.00 per litre Average cost per sq.ft, for office space in the central business district - US$3.91/TT$25.00 per sqft (Rented) Average cost per sq.ft, for industrial space in the central business district - US$2.34/TT$15.00sqft rented Average cost per sq.ft for land (zoned for commercial use) in/nearby central business district - US$23.44/TT$150.00 per square foot ***All charges are subject to 15% Value Added Tax.
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How to import meat products to Trinidad & Tobago?
Importers of meat and meat products, excluding poultry, are required to obtain a Meat Products Inspection Certificate prior to the importation of meat products. The Meat Products Inspection Certificate confirms that the product is suitable for consumption and allows for the importation of meat and meat products into Trinidad and Tobago with minimal risk to the animal and human populations. Poultry is not included under these regulations but importation guidelines can be found on: www.ttconnect.gov.tt. Persons importing meat or meat products in amounts classified as personal allowances do not have to apply for permits but must have evidence of the country of origin. Products should be in original packages, bearing inspection marks of the veterinary authority of the country of origin. What steps should I follow in order to import? The importer should: Obtain a Meat Products Inspection Certificate (import permit). Apply for a license to import from the Ministry of Trade, Industry & Investment (MTII). To apply for an Import Licence, please contact the Trade Licence Unit at 675-8242 or 638-9151 or TradeLicenceUnit@gov.tt Pay Customs and Excise duties on the meat product. Please contact the Customs and Excise Division of the Ministry Finance, at Tel. (868) 635-3311, for more information on paying Customs duties. Have the items inspected for wholesomeness by the Chemistry, Food and Drug Division (CFDD) of the Ministry of Health. Please see the information below on the CFDD. Chemistry Food and Drugs Division Ministry of Health 92 Frederick Street Port of Spain Trinidad, West Indies Tel: (868) 623-5242 Fax: (868) 623-2477 E-mail: cfdd@health.gov.tt Opening hours: 8:00 am to 4:00 pm, Monday to Friday except public holidays.
Are there any other requirements? The meat or meat product must be from a country that is free of any disease associated with the specific item. For example, beef can only be imported from a country free of Bovine Spongiform Encephalopathy (mad cow) and Foot and Mouth diseases. What documents do I need to apply for a permit? To apply for a permit, importers are required to submit the invoices and health certificate from the country of origin. First time applicants should provide a company letter along with the application form for the import permit. How do I apply for an import permit? Application forms for a Meat Products Inspection Certificate can be obtained from: The Office of the Chief Veterinary Officer Animal Production and Health Division Ministry of Food Production 80 Abercromby Street Port of Spain Trinidad, West Indies Tel. (868) 625-5997/1473 Fax. (868) 625-5993 E-mail: aphmalmr@tstt.net.tt Opening hours: 8:00 am to 4:00 pm, Monday to Friday, except public holidays
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Caribbean Export supports the creative industries... English speaking Caribbean that not only features writers from the Caribbean and around the world, but also musicians and provides a market for carefully selected artisans to sell their products to the large attending audience over the 3 days. Caribbean Export has partnered with the organizers of Calabash to leverage this established platform of the arts for CARIFORUM artisans that are seeking to enter new markets and be part of a Design Caribbean stand at the festival. Calabash provides an opportunity for regional artisans to network with international and Caribbean attendees who visit the festival in order to generate further interest in their products. Caribbean Export Pamela Coke Hamilton, Executive Director, Caribbean Export speaking at the recognizes that regional artisans are seeking launch event. new avenues and opportunities for market The Caribbean Export Development Agency (Caribbean entry and penetration and it is therefore envisaged that Export), got CREATE-ive when it launched its latest pub- Calabash will provide an outlet for the achievement of lication, aptly titled ‘CREATE’, a publication which ap- this goal which is scheduled to take place from May, 30 plauds the successes of entrepreneurs in Caribbean crea- – June 1, 2014 at Jakes in Treasure Beach, Jamaica. tive industries. Appropriately, the launch of the publication occurred in synergy with the CALABASH International As part of the launch event, patrons were entranced by Literary Festival Launch at the Red Bones Blues Cafe, the captivating rhythms of Xiomara Fortuna, a recording Jamaica on Thursday March 20th, 2014. artist from the Dominican Republic who features in the CREATE publication. Fortuna’s music is a unique fuThe creative industries continues to be recognised as a sion of various Caribbean indigenous forms which, in its significant contributor to growth and development in the essence, encapsulates the vision of a unified region world economy and can become a pillar for economic di- which Caribbean Export upholds. versification and catalyst for export growth in the Caribbean. The creative industries represents a dynamic sector “We see our role, made possible by the 10th European that encompasses disciplines ranging from traditional arts Development Fund as giving structure and support and crafts to multimedia. through opportunities and exposure in publications like CREATE and at events such as Calabash, and for creaThe CREATE publication showcases only a microcosm, tive talent across the region to become strong exportable albeit impressive collection, of entrepreneurs from the products for the rest of the world to embrace” commusic, film, fashion and creative design industries. The mented Pamela Coke-Hamilton, Executive Director, Agency’s Executive Director Pamela Coke-Hamilton set Caribbean Export. the tone for the publication at the event with an engaging and unconventional speech which spoke to the vision be- More information about Caribbean Export can be found hind the publication and the impetus for the partnership at www.carib-export.com. between Caribbean export and CALABASH. Contact: JoEllenLaryea, PR and Communications, Caribbean Export Development Agency, Tel: +1(246) 436Since 2001, the Calabash International Literary Festival 0578, Fax: +1(246) 436-9999, Email: jlaryea@caribhas become the premier international literary festival in the export.com
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TIC 2014: Offering Unparalleled B2B Matchmaking! One of the best features of the annual Trade and Investment Convention (TIC) is its outstanding ability to effectively matchmake relevant business to business meetings. In other words, being at the Caribbean’s largest trade and investment convention as a business buyer or exhibitor is a cost effective opportunity for expanding your product line, markets, investment opportunities and networks. The Trinidad & Tobago Manufacturers Association (TTMA) has built a reputation of delivering a top quality convention over the 15 years it has been hosting the show. TIC is the region’s pre-eminent trade promotion event which holds the reputation of helping businesses succeed in the ever-evolving realm of marketing and exhibiting. Business presence at the TIC 2014 is a sure sign that your company is a serious and significant resource.
Post-event surveys have revealed that attendees generate highly qualified leads with key decision makers and purchasers from across the region through their presence at TIC. It is also seen as an opportunity to strengthen relationships with existing customers Exhibitors have earmarked TIC as being the place to highlight new capabilities and establish a presence in the TT market as well as non-English speaking markets in the wider region with bigger markets. Some two hundred exhibitors will see hundreds more of qualified buyers all converging at Macoya in Trinidad, 2 5 July, 2014. Every business sector and industry will be represented and with comprehensive marketing support and unique advertising and sponsorship opportunities provided by the host, there is no doubt that exhibitors and buyers will both report a successful TIC 2014. To be present at this year’s Trade and Investment Convention 2014 as an exhibitor or buyer, now is the time to register. Contact the TIC Secretariat at ticbuyers@ttma.com or call (868) 675 8862 ext. 247.
Have you ever wanted to do business with T&T? The Jamaica– T&T Trade Facilitation Desk can assist you with the following:
Inform Jamaican businesses (among others) about import regulations & entry requirements into the Trinidad and Tobago’s market, as well as representing their interests; Assist Jamaican companies with regulatory agencies’ relations in complying with TT regulatory standards, and offer strategic input and technical guidance on requirements; Assess Jamaican firms’ potential in the local market, provides market intelligence and value added advice on the opportunities and challenges of doing business in TT; Advice on upcoming events such as trade fairs, conferences, workshops, seminars and trade missions; Encourage networking and facilitating business match-making with TT companies to boost investment and trade; Undertake consultations with prospective exporters, business support organizations and representatives of the public sector institutions that play key roles in the export process in TT and Jamaica; Address main areas of concern and key issues to the relevant trade institutions & regulatory agencies in T&T and Jamaica (intermediating with such arms as customs, the standards authorities, and helping with negotiating the bureaucracy) and offering support solutions; Assist in the coordination of visits and trade missions to TT (planning, ground support and follow up). Proactively build networks and alliance between parties to facilitate trade relations and foster partnerships between Jamaican institutions and local counterparts. If you have additional questions or if we can be of any assistance, please feel free to contact: Mrs. Naika Pichi-Ayers, Jamaica-TT Trade Desk Officer & Editor of the Newsletter at: (868) 675-8862 Ext. 239 Email: tradeassist@ttma.com