WORLD TRADE
ORGANIZATIONWT/TPR/M/49
15 December 1998
(98-5054)
Trade Policy Review Body
12-13 November 1998
TRADE POLICY REVIEW
TRINIDAD AND TOBAGO
Minutes of Meeting
Chairperson:  H.E. Mr. Ali Said Mchumo (Tanzania)
Page
I. INTRODUCTORY REMARKS BY THE CHAIRPERSON      3
II. OPENING STATEMENT BY THE REPRESENTATIVE OF
TRINIDAD AND TOBAGO      4
III. STATEMENT BY THE FIRST DISCUSSANT      7
IV. STATEMENT BY THE SECOND DISCUSSANT    10
V. STATEMENTS BY MEMBERS OF THE TRADE POLICY REVIEW BODY    11
VI. REPLIES BY THE REPRESENTATIVE OF TRINIDAD AND TOBAGO
AND ADDITIONAL COMMENTS    16
VII. CONCLUDING REMARKS BY THE CHAIRPERSON    20
ANNEX I    23
ANNEX II    29WT/TPR/M/49
Page 3
I. INTRODUCTORY REMARKS BY THE CHAIRPERSON
1. The first Trade Policy Review of Trinidad and Tobago was held on 12 and 13 November 1998.
The Chairperson welcomed the delegation of Trinidad and Tobago, led by the Honourable Mervyn
Assam, Minister of Trade and Industry, as well as  Chargé d'affaires Richards, and the discussants,
Mr. Andrew L. Stoler (United States) and Ms. Clau dia Orozco Jaramillo (Colombia).  As usual, both
discussants would speak in their personal capacities and not as representatives of their countries.  Inaccordance with the established procedures, the discussants had made available, in advance, an outline of
the main issues they intended to raise.
2. The Chairperson recalled the purpose of the Trade Policy Reviews and the main elements of the
procedures for the meeting.  The report by the Government of Trinidad and Tobago was contained in
document WT/TPR/G/49 and that of the WTO Secretariat in document WT/TPR/S/49;  the main issues to
be raised by the discussants were contained in document WT/TPR/D/27.  Copies of advance written
questions, submitted by five delegations Canada;  the European Union;  Hong Kong, China;  Japan;  andthe United States (Annex I) had been transmitted to the delegation of Trinidad and Tobago.  If full replies
could not be provided during the meeting, supplementary written replies could be provided later.WT/TPR/M/49
Page 4
II. OPENING STATEMENT BY THE REPRESENTATIVE OF TRINIDAD AND TOBAGO
3. The representative of Trinidad and Tobago expressed his satisfaction regarding the review of his
country's trade policies. The review provided an id eal opportunity to assess the effectiveness of these
policies, particularly in the wider context of the globalized economy, and to explain some of the domestic
imperatives which had informed those policies. Trinidad and Tobago had become a contracting party to
the General Agreement on Tariffs and Trade on 23 October 1962, and had participated in every round ofmultilateral trade negotiations since that date. Since 1990, within the context of a Structural Adjustment
Programme, and independently of the Uruguay Round negotiations, Trinidad and Tobago had pursued a
trade liberalization regime aimed at diversifying the economy and promoting improved efficiency in the
operations of local companies, expansion in export-oriented production in the manufacturing, services,
tourism and agricultural sectors, enhanced international competitiveness and increased export earnings.
4. Trinidad and Tobago's trade reform programme had been closely linked to initiatives to attract
foreign investment and facilitate the development of the domestic industrial base. Within this policyreform environment, the role of the Government had been redefined to that of a promoter and catalyst for
trade and industrial development while the private sector was to become the prime generator of economic
growth and development.  In pursuit of this goal, the development of the small business sector was
acknowledged to be an essential prerequisite fo r the balanced development of the local economy.
Regarding market access, Trinidad and Tobago had adopted a dual approach directed towards theexpansion of its market share for non-traditional products in traditional markets, particularly where
preferential market access arrangements were available, while seeking to penetrate non-traditional
markets.
5. The implementation of the programme of structural reform had impacted favourably on the
economy.  In 1997, the economy had recorded its fourth consecutive year of economic growth.  Realoutput had grown by an average of 3% since 1994 propelled by increased exploration and production
activity in the petroleum sector as well as expansion in the non-oil sector.  In 1997 strong performances
had been recorded in the manufacturing, construction, distribution and transport sub-sectors, while the
tourism industry had displayed increased vibrancy.
6. Trinidad and Tobago remained firmly committed to a rules-based multilateral trading system.
Within the context of the Uruguay Round, it had willingly assumed obligations disproportionate to its size
and assumed commitments in all areas includin g the services sector (financial services,
telecommunications, educational services, maritime services, professional services, medical services,
etc.).  Trinidad and Tobago had also done a great deal  within the last three years to bring its intellectual
property laws into compliance with the TRIPS Agreement.
7. The importance and success of the WTO/GATT was reflected in the fact that membership had
increased from 23 countries in 1947 to 132 countries in 1998, and average tariffs had been reduced to onetenth of the levels of 50 years ago.  However, the Organization would in the future be confronted with a
number of challenges including the widening gap between industrial and developing countries. The WTO
needed to address the particular interests and needs of developing country Members and to ensure that
sustained efforts were made towards balancing the obligations assumed by these states and the benefits
they derive from the system.  Against this background the WTO should formulate appropriatemechanisms designed to minimize any distorting effects of trade policies.
8. The WTO had ushered in a regime of stricter enforcement of trade regulations.  The tightening of
these regulations had to some extent restored the confidence of Member States as exemplified by the fact
that in the period 1995-1998 the WTO Dispute Settlement Body had considered 132 complaints,
compared to a total of 300 complaints in the 47 years of existence of the GATT.  However, it wasWT/TPR/M/49
Page 5
necessary to be aware of the effect that strict enforcement devoid of socio-economic considerations could
have on small economies with limited development options. The banana dispute was a case in point.  A
number of small Caribbean countries with a long hist ory of democratic and stable governance now saw
their prospects for development jeopardized by a legalistic approach to trade conflicts.
9. The ongoing global financial crisis presented another challenge to the WTO.  A key lesson to be
learned from this crisis was the importance of appropriately regulated financial sectors.  This was all themore critical in a world in which an increasing amount of capital was being intermediated through private
capital markets.  In order to avoid, in the future, a substantial negative fallout from similar crises, it was
important that countries put in place mechanisms to strengthen their domestic financial infrastructure to
allow them to: (a) exploit effectively the benefits of  open capital accounts; and (b) minimize the risks
associated with the high degree of volatility in capital flows.
10. The advent of electronic commerce would have a significant impact on world trade and some
countries had pressed for its inclusion in the agenda of the WTO.  Some experts had reached theconclusion that developing countries had much to gain from advances in electronic business and financial
transactions.  However, at this point in time the majority of developing countries were not equipped to
benefit fully from this new development.  The inte rnational community had an obligation to ensure that
these countries became part of this technological revolution in a manner which would be beneficial for
their societies.
11. In addition, developing countries had been subject to various trade actions such as anti-dumping
and safeguard measures applied by developed countries. He reiterated the issue raised by him at the
Ministerial Conference in Geneva in May 1998, that the WTO should ensure that the playing field and the
rules of the game were not detrimental to the majority of players.  He wondered whether the WTO was
equipped to have Members rights recognized in the context of an equitable multilateral trading systemwithout always having to resort to the dispute settlement mechanism. It was imperative that new and
imaginative approaches be devised for dealing with the issue of special and differential treatment within
the WTO context.
12. He drew attention to the issue of small economies introduced by the delegation of Mauritius and
co-authored by a number of countries including Trinidad and Tobago.  As a small developing island,Trinidad and Tobago fully supported the initiatives undertaken within a number of international bodies
and fora (Commonwealth, UNCTAD and FTAA) to address the issue of the vulnerability of small states
and to identify measures aimed at facilitating their integration into the global economy.  This group of
countries was more adversely affected by environmental factors including natural disasters, as witnessed
by the devastation wrought on the Central American countries by Hurricane Mitch and on St Kitts/Nevis
and Antigua and Barbuda by Hurricane George, deserved the special attention and support of the
international community.
13. New and imaginative approaches should be based on the need for a total package of assistance
and support to developing countries and should inter alia  include: (a) the provision of technical assistance
for instituting the necessary macro-economic and trade policy reforms essential for their effective and
meaningful participation in world trade; and (b) the development of mechanisms designed to promote the
transfer of technology and flows of investment into  developing countries. Developing countries should
examine the feasibility of establishing avenues of mutual cooperation in areas such as technology sharing,
joint utilization of human and material resources and joint industrial and developmental projects.  Seeking
methods to expand trade and investment flows among  developing countries might prove to be another
avenue for the development of these countries.WT/TPR/M/49
Page 6
14. His Government was firmly committed to trade liberalization  and had implemented a wide range
of measures including virtual elimination of the Im port Negative List in conjunction with the reduction of
the Common External Tariff, removal of foreign exchange controls and improvement in Customs
procedures.  These were all detailed in the documentation presented.
15. He had been honoured to present Trinidad and Tobago's trade policies for review and expressed
his country's commitment to the principles and objectives of the WTO, which were geared towards theenhancement of economic growth and the improvement of living standards.WT/TPR/M/49
Page 7
III. STATEMENT BY THE FIRST DISCUSSANT
16. The first discussant Mr. Andrew L. Stoler stated that the Government of Trinidad and Tobago,
like many other Governments which had found themselves the beneficiaries of unexpectedly large
sources of revenue in the days before oil prices collapsed, sought to build an economy with strong State
intervention where the State owned the lion's share of the country's economic assets.  The temptation to
embark on such policies was widespread in those years and was entirely understandable, particularly inthe case of a small island country.  What came across in this review very clearly was that the changed
macroeconomic environment had brought on the need to change those earlier policies and the
Government had both recognized and embraced that need.
17. When the balloon had burst in the early 1980s, much of what had been achieved in the strong
growth years had been lost and in 1988 the Govern ment had introduced an important structural reform
and liberalization programme.  For a variety of reasons, the positive impact of the programme had taken
some time in coming and the Secretariat's report suggest ed that the period of higher growth in the post
1994 period was probably directly related to the greater degree of openness in the economy in this period.
18. Most recently, higher growth rates spurred in part by increases in foreign direct investment, had
also engendered a big rise in imports.  After consiste ntly having realized trade surpluses in every year
since 1989, the trade account for 1997 had gone into a sizeable deficit as a result of a big increase in
imports from the United States.  The discussant had so far been unable to locate reliable statistics on thecomposition of trade by destination and source for 1997, so he could not say whether the increased
imports were capital goods perhaps destined for the energy sector, or consumer goods encouraged by
rising incomes. If the visiting government team from Trinidad and Tobago could shed some light on the
nature of the 44% growth in imports in 1997, it  would make an important contribution to his
understanding of the current macroeconomic context.
19. While the trade balance had swung into a large deficit in 1997, other macroeconomic indicators
were in pretty good shape. Net foreign exchange reserves had grown steadily since 1992.  Inflation had
fallen to only 3.7% in 1997. There had been a big increase in the percentage of GDP accounted for by
private consumption and a fall in government c onsumption as a percentage of GDP.  The economy
overall had grown steadily at a rate of more than 3% in recent years and for a variety of the right reasons,the Government had been able to post a budget surplus since 1995.
20. In line with the other structural reforms introduced  since 1988, it was clear that the Trinidad and
Tobago Government had re-thought the role of the State in the economy. The Government report stated
that it had redefined its role as a promoter and catalyst of trade and industrial development, while it now
saw the private sector as the prime generator of economic growth and development.  That seemed to be
reflected in the big increase in private consumption as a percentage of GDP.
21. There had been a programme of privatization ongoing in Trinidad and Tobago now since the late
1980s.  Both the Secretariat report and the Governme nt submission detailed the divestment policies
followed by the Government of Trinidad and Toba go. Government ownership in enterprises was much
reduced from what it had been at the beginning of the decade; however, the Government of Trinidad and
Tobago's commitment to divestiture seemed to be tempered by a desire to maintain effective management
control of many of the enterprises where private investment had now been permitted. He wonderedwhether it was really either necessary or desirable for the Government of Trinidad and Tobago to
maintain a controlling interest in so many commerci al enterprises such as the Iron and Steel Company andWT/TPR/M/49
Page 8
the National Flour Mills. He asked whether the Government would proceed to divest its interest in
Caroni, the only producer of sugar in the country, after reorganizing its management and operations.
22. From both the Government submission and the report prepared by the Secretariat, he got the
strong feeling that the Government of Trinidad and Tobago was interested in encouraging important
changes in the structure of the economy. However, for a variety of good reasons, it would seem that the
desired changes were not going to be easy to bring about.
23. He described the agricultural sector as the smallest and least "healthy" sector of the domestic
economy, accounting for only 3% of GDP and dominated by the sugar industry where the Government
was the owner of the monopoly enterprise, Caroni, which had accumulated sizeable deficits over the
years. International trade in sugar had created circumstances in which exports of the product provided an
important international subsidy to the islands' economy.  Sugar sales to the European Union and the
United States at quota prices well above world market prices were so important that sugar was actually
imported into Trinidad and Tobago when domestic production was insufficient to meet both export quotasand domestic demand.  It seemed curious that a Government-owned and operated enterprise would act to
satisfy export quotas before satisfying domestic demand and still would lose large amounts of money in
the process.
24. The Secretariat report indicated that the Government of Trinidad and Tobago saw "great potential
for income, employment and foreign exchange generations in the agricultural sector".  He wondered howrealistic such aspirations were when farmers and growers in nearly every agricultural subsector sold their
production at Government guaranteed prices and where identified constraints to production included
inadequate water supply, high cost of inputs, inadequa te facilities, poor market organization and poor soil
management.  He asked the Trinidad and Tobago delegation to comment on how it would reconcile the
apparent inconsistencies between its declared objectives for the agriculture sector and the evidentproblems facing this sector.
25. Three quarters of the Trinidad and Tobago's labour force worked in the services sector, which
accounted for 61% of GDP.  More than twice as many people worked in the financial services industry
than in the hydrocarbons sub-sector.  So far, only one 1% of GDP was generated by the tourism industry,
so this seemed to be an area of potential growt h. Given the limited reserves of hydrocarbons, it would
seem that the services sector was destined to increase in importance. The financial services sector,
accounting for 11.5% of GDP and employing over 8%  of the labour force, was the most important
services sector. He worried about the long-term health of the financial services sector in the globalizing
economy as the Secretariat report indicated that there could be a capacity for monopolistic pricing that
had created larger than expected profits.  He noted that if the growth of the sector and its relative
importance in the economy had come about through a lack of effective competition then the sectors long
term prospects might not be too good.
26. The documents provided for this review indicate d that the Government of Trinidad and Tobago
was considering adopting a competition policy framework as part of a proposed "Fair Trading Act".  He
asked the delegation whether the introduction of competition policy was in part motivated by the
prevailing situation in the financial services sector.
27. The energy sector (oil and gas production) dominated goods production and was the principal
reason for the important inflows of foreign investment. The Government was rightly concerned about
over-reliance on this sector, particularly given the finite reserves of oil and gas. ln its submission, the
Government indicated that its industrial policy was focussed mainly on the development of the non-oil
manufacturing sector with a view to diversify economic activity. He wondered why, notwithstanding theWT/TPR/M/49
Page 9
introduction of diversification strategies, the share of petroleum-related manufacturing had increased from
41.5 % to 66.4 % of total manufacturing GDP in the 1992-96 period.
28. The Government of Trinidad and Tobago appeared to have embarked on a significant
modernization of economic policy-making.  Starting with the 1988 policy reforms and including the more
recent moves to divest State interests in commerc ial enterprises, Trinidad and Tobago was clearly
bringing its economy more into line with the market-oriented policies that were at the base of the WTOAgreements.  Other areas deserving mention and study by participants in this review included reduced
reliance on price controls, the establishment of a venture capital fund and special measures to assist small
businesses, and the establishment in April 1997 of the Securities and Exchange Commission.  He felt that
the Government of Trinidad and Tobago should be encouraged to move forward with the planned Fair
Trading Act as a way of guaranteeing that the economy developed in a competitive manner.
29. He invited WTO Members to congratulate the Government of Trinidad and Tobago on these
initiatives, all of which had pointed Trinidad and Tobago in a healthy direction for the future. He wouldbe interested in learning of the fruits of these efforts when Trinidad and Tobago next came before WTO's
Trade Policy Review Mechanism.WT/TPR/M/49
Page 10
IV. STATEMENT BY THE SECOND DISCUSSANT
30. The second discussant (Ms. Claudia Orozco Jaramillo) commended Trinidad and Tobago for its
positive implementation of its WTO commitments,  evidence of an open trade policy. Applied tariffs were
below bound levels, with an average of 7% for industrial products, and 19% for agricultural goods. She
noted that the TRIPS Agreement had been implemented and incorporated in domestic legislation.
Commitments undertaken in various services sub-sectors were being implemented. She would like tohave the delegation of Trinidad and Tobago's view on the contribution of the implementation of the WTO
agreements to the modernization and diversification effort undertaken by the Government.
31. In parallel to its participation in the WTO, Trinidad and Tobago was an active member of
CARICOM, had signed bilateral agreements with Colombia and Venezuela and participated in regional
agreements negotiations. Trinidad and Tobago acc ounted for 20% of CARICOM trade flows; exports to
other CARICOM members represented a quarter of total exports. Trinidad and Tobago was also the
beneficiary of various schemes of preferences. Both  the European Union and the United States granted
preferential treatment to their imports of sugar from Trinidad and Tobago. Notwithstanding this, it was
noted that Trinidad and Tobago had to import sugar to fully utilize its quota under both preferential
arrangements. She would like to know what the reasons were for this deficit in domestic production.
32. It was clear from both the Government and the Secretariat's reports that Trinidad and Tobago was
seeking to complement its trade policy with an ade quate investment policy. To this end, Trinidad and
Tobago had signed international agreements for the pr otection of investment, both at the bilateral and at
the multilateral level, and was in the process of reviewing its domestic legislation to enhance the
transparency of its decision-making process and of its system of incentives. The main goal was to attract
foreign investment in order to enhance economic diversification and shift production to export markets.
This was already the case in the natural gas sector. She cautioned, however, against the wide array offiscal incentives for investments in tourism and petrochemical products, and against the extensive use of
free zones.
33. Trinidad and Tobago's implementation of it s WTO commitments was, in general terms,
satisfactory. She was concerned, however, about the level and coverage of  surcharges applied on certain
agricultural imports. Although levels had come down, they were still high. Moreover, certain productswere subject to quantitative restrictions, and others to non-automatic import licensing. She wondered
whether the delegation of Trinidad and Tobago could explain the need for the use of the previously
mentioned measures, especially since applied tariff levels were below bound levels, and whether it could
provide information regarding their use in the future.
34. Noting that exports of certain agricultural products, such as coffee and cocoa, had declined, she
sought clarification regarding the reasons for this decline. Regarding services, she would be interested in
knowing why tourism had not contributed more to the sector's development. She noted the efforts
displayed by the Government to diversify production and exports through free zones, investment
promotion, promotion of small and medium-size enterpri ses, and a redefinition of the role of the State.
However, programmes to attract investment included an array of fiscal incentives, including tax
exemptions for a period of up to ten years, import duty concessions,  and tax credits for expenses. She
wondered if the delegation of Trinidad and Tobago could elaborate on the possible effects of theseincentives on government revenue and on whether it thought they might be hindering the public sector
investment needed to create an adequate framework for private investment.WT/TPR/M/49
Page 11
V. STATEMENTS BY MEMBERS OF THE TRADE POLICY REVIEW BODY
35. Members appreciated Trinidad and Tobago's strong commitment to the WTO, its continuing
efforts to diversify and open its economy, and to improve the investment climate, particularly in view of
the recent crisis in its financial sector.
36. The representative of Hong, Kong, China noted that the bilateral trade between Hong Kong,
China and Trinidad and Tobago had amounted to US$15.8 million in 1997, and had observed an
increasing trend in recent years.  In the first 8 months of 1998, total bilateral trade had increased by 18.6%
over the same period in 1997.  Goods exported from Hong Kong, China had included textile yarn, fabrics,
makeup articles, food products, apparels and machinery, while imported products from Trinidad and
Tobago had included fish, cotton, wood, textile yarn, fabrics amd makeup articles.  Hong Kong, China
appreciated Trinidad and Tobago's recent effort to liberalize and encouraged it to continue its efforts,
especially in diversifying its product base and opening up its services sector.  Hong Kong, China had
submitted written questions on tariffs and additional duties, standards and technical regulations, services,including financial services, telecommunications services, maritime transport and civil aviation services.
37. The representative of Canada noted that Trinidad and Tobago and Canada enjoyed a longstanding
and multi-faceted bilateral relationship with a strong tradition of cooperation. Trade between Canada and
Trinidad and Tobago could be traced back nearly 400 years.  In 1997, two-way merchandise trade had
totalled Can$129 million, excluding trade in services. Canada also had significant investment interests inTrinidad and Tobago, particularly in the energy and banking sectors, which stood now at over
Can$1 billion.
38. Under CARIBCAN, Trinidad and Tobago enjoyed preferential access to the Canadian market for
most products.  Under legislation passed by Canada earlier this year, the list of duty-exempt products
under CARIBCAN had been expanded and now included travel bags, methanol, and lubricating oils; thelatter two products were of particular importance to Trinidad and Tobago.
39. In Canada's view, Trinidad and Tobago had been a solid proponent and player in efforts to
liberalize international trade and commercial exchanges,  had played a leadership role in the formation and
evolution of CARICOM, including the implementati on of the CET, and was an active participant in
initiatives to develop a FTAA.  The Government of Trinidad and Tobago was to be commended for thevery considerable progress achieved over the past decade in liberalizing its trade policies and import
regime to bring them into conformity with its CARICOM and WTO commitments.
40. Canada encouraged the ongoing efforts of Trinidad and Tobago to create "a more
investor-friendly climate in the local economy" and tr usted that, in amending its Foreign Investment Act.
the Government would not reduce its protection of foreign investors. Canada also welcomed Trinidad and
Tobago's continued efforts "to reduce the number and complexity of bureaucratic procedures involved in
investment and business transactions" and its stated objective of making these procedures "as simple andtransparent as possible. Canada encouraged the Govern ment to set a more transparent pricing structure in
the natural gas sub-sector, which would make it even more attractive to foreign investors.
41. Another area where more consistency and transparency would enhance Trinidad and Tobago's
attractiveness to Canadian and foreign investors was in the issuance of work permits.  While Canada
appreciated that Trinidad and Tobago wished to ensure high quality employment for its many well-trainedworkers, the uncertainty surrounding the issuance and renewal of work permits, and the lack of a
mechanism to appeal negative decisions, presented great difficulties for foreign investors. Canada wouldWT/TPR/M/49
Page 12
also welcome more transparency regarding quantitative restrictions applied to the import of live poultry,
both at the level of relevant WTO notifications and at the level of public dissemination of trade
regulations.
42. Canada encouraged Trinidad and Tobago to update and streamline its legal, regulatory and
administrative framework with respect to trade and investment, and to increase transparency in the
procedures and practices of certain government ministries and agencies.
43. Canada welcomed the important steps taken by Tr inidad and Tobago to liberalize its trade and
investment regimes in recent years, which were reflected in the sustained current economic growth, and
strongly encouraged Trinidad and Tobago to continue the process of privatization and of public sector
modernization and reform. Canada believed that these initiatives would make an important contribution to
maintaining Trinidad and Tobago's continuing drive towards full market liberalization and long-term
economic growth.
44. The representative of the United States noted that  trading relations between the United States and
Trinidad and Tobago were rich in tradition and extensiv e due in part to the geographical proximity of the
two nations. The United States was Trinidad and Tobago's largest trading partner, importing almost half
of its exports, while supplying more than one-third of its imports. The investment relationship between
the two countries was equally close: the United States was the largest investor in Trinidad and Tobago
with extensive U.S. private sector investment in hydrocarbons and related downstream industries.
Trinidad and Tobago was second only to Canada in the hemisphere in per capita U.S. direct foreign
investment.
45. The United States congratulated Trinidad and Toba go's efforts in the process of liberalization and
deregulation, which had produced sustained growth with low inflation in recent years.  Growth had
continued to accelerate largely because of inve stment in the country's petrochemical sector.
46. With respect to the WTO, Trinidad and Tobago's efforts to bring its legislation into accord with
its WTO commitments would help ensure that the en vironment for trade and investment continued to be
positive. Trinidad and Tobago had started applying the WTO Agreement on Customs Valuation,
although, as a developing country, it had until end 1999 to bring its valuation system into conformity with
the Agreement.
47. However, further actions could be taken to improve the trade and investment environment. He
noted that a number of loss-making state-owned en terprises remained; he also noted the continued
existence of licensing procedures as well as import surcharges on a number of products, particularly in the
agricultural area.  These appeared to be vestiges of earlier policies which could be further liberalized.
Government revenues had weakened because of the dr op in world oil prices.  Divestment of loss-making
state enterprises and improved, simplified tax administration could help to offset this trend.
48. The United States believed Trinidad and Tobago had made tremendous progress in liberalizing its
trade regime and urged it to continue down this track.
49. The representative of the European Union stated that the relations between the European Union
and Trinidad and Tobago were governed by the revised Lomé IV Convention, which had been signed in
Mauritius on 4 November 1995 and which expired in February of the year 2000.  Trinidad and Tobago
benefitted from the trade and services provisions of the Convention as well as from special arrangementsfor sugar, rum and other commodities.  The Conventi on granted preferential access to the EU market on a
non-reciprocal basis to goods from Trinidad and Tobago. The trade provisions of the Lomé Convention
were the most valuable part of the agreement fo r many ACP countries. The new EU-ACP Convention, toWT/TPR/M/49
Page 13
enter into force in March 2000, should take into a ccount the limitations of the current Lomé provisions
based on preferential market access and the developments resulting from the conclusion of the Uruguay
Round. The European Union had recently commenced negotiations with its ACP partners for the new
Convention, which would take into account the relevant WTO rules and the sustainable development of
the ACP economies, by preparing them for an era of services and new technologies and by encouraging
them to move away from trade protection to open comp etitive trade. Trinidad and Tobago needed to take
account of such forthcoming changes and to continue to pursue its policy of economic diversification.
50. Trinidad and Tobago was a small country, with a small population and internal market. Despite
these constraints, it had been diversifying and opening its economy, in order to respond to the new
requirements of global competitiveness and regional integration, with remarkable results.
51.  The Government had achieved a good record of political stability and stable macro-economic
performance.  The energy sector in particular had shown great dynamism, and the financial sector
continued to perform well, although interest rates remained high.  Tourism activities had expanded, butthe agricultural sector had performed unsatisfactorily, in particular the sugar industry. Lower oil prices
would have a negative impact on budget revenues in 1998. Another point of concern was the high
unemployment rate.
52. The European Union welcomed the Government of Trinidad and Tobago's commitment to a
coherent poverty reduction programme; the European Union was fully prepared to reinforce thisprogramme with suitable projects funded under the National Indicative Programme (NIP). These projects
could be targeted to develop infrastructure, tourism capacity and export promotion with a view to
contributing to economic diversification.
53. The European Union recognized the efforts of the Government of Trinidad and Tobago to comply
with WTO rules, to improve competition and the investment climate and to liberalize its economy.
Concern was expressed, however, with regard to the ra nge, costs and coherence of the various investment
incentives offered by the Government in energy, manufacturing and in some services activities. The
European Union would continue providing for economic diversification and employment creation as
agreed in 1997 under the NIP.
54. The representative of Japan stated that Trinidad and Tobago's economy relied heavily on
production and export of oil and natural gas.  After the decline in oil prices in the mid 1980s the
Government of Trinidad and Tobago had introduced measures to restructure its economy by reducing
customs duties and promoting privatization.  Trinidad and Tobago had succeeded in attracting foreign
investment, particularly in the energy sector, as a result of stabilization policies and an increased openness
of the economy, and since 1994 the economy had recorded positive growth. Trinidad and Tobago's
economy was expected to continue to show a positive gr owth as a result of high foreign direct investment
in the energy sector and growth in non-petroleum activities.  However, in order to achieve sustainableeconomic growth and social development, as well as to promote foreign trade, further measures were
required such as further diversification of economic activity, the restructuring of the public sector and the
development of  infrastructure.  Japan expected Trinidad and Tobago to implement policies to meet such
objectives and to achieve economic development as well as to contribute to strengthening multilateral
trading system through further liberalizing its trade regime.  He appreciated that Trinidad and Tobago hadmade commitment in various services sectors during the Uruguay Round and also had participated
actively in negotiations on financial services and ba sic telecommunications services.  However, sectors on
which Trinidad and Tobago had made commitments were still limited.  Japan expected Trinidad and
Tobago to further liberalize its services regimes including sectors which had not been committed, and toWT/TPR/M/49
Page 14
consider to make commitments in these fields during the coming negotiation.  Japan noted that it had
posed written questions on tariffs, other duties and taxes, standards and technical regulations, competition
policy, banking, telecommunications and maritime transport services.
55. The representative of Mauritius stated that her country and Trinidad and Tobago had a number of
things in common: they were both small island states, small economies and net food importers. She noted
that although Trinidad and Tobago was an exporter of agricultural products, it imported some 75% of itsdomestic food requirements.  This was the case for many small island states for whom food security
remained of paramount importance.  Trinidad and Tobago was a clear example of how food security was
not necessarily linked to production capacity but to the ability of a country to generate sufficient foreign
currency to import its food requirements.
56. She stated that while Trinidad and Tobago was endowed with oil and gas, unlike most other small
islands, strong reliance on the production and export of these two resources was a matter of concern,
particularly bearing in mind that proven reserves were estimated at 12 years' supply for oil and at 55 yearsfor natural gas at the current rate of output.  She welcomed the initiative of the Government to diversify
the economy away from the energy sector.  She noted th at the Secretariat report made reference to the
development of the services sector, particularly transhipment activities.  She felt that it would be
interesting to know which other sectors had been identified as alternative and reliable sources of revenue.
57. Mauritius had noted with interest the introduction by Trinidad and Tobago of a Trade Reform
Programme that was closely linked with the objectives of attracting foreign investment and of facilitating
the development of the domestic industrial base. She cautioned that the competitiveness of Trinidad and
Tobago as an investment center could be hindered by the erosion of preferences and the uncertainty about
the future of the Lomé Convention.  She, therefore,  expressed her understanding of the reasons that had
led Trinidad and Tobago to introduce initiatives aimed at attracting foreign investment.
58. The representative of Costa Rica noted the effort by Trinidad and Tobago to implement its WTO
commitment through the amendment of domestic legislation, particularly regarding anti-dumping and
intellectual property. Furthermore, it would seem th at Trinidad and Tobago was planning to dismantle its
system of export incentives in 2000, although, as a developing country it had until 2003 to meet is
obligations under the Agreement on Subsidies and Countervailing Measures. He understood that one ofthe goals of the Government was to diversify foreign investment and to this end a new Foreign
Investment Act would be put in place. In this respect, he would be grateful to the delegation of Trinidad
and Tobago if it could identify the main changes included in the new legislation as compared to the
previous law. Costa Rica would also be interested in receiving more information regarding the
expropriation and compensation regime, regulations regarding the transfer of capital and rules related to
senior management. It would be interesting to know  whether the definition of foreign direct investment
included intangible goods, such as TRIPS or other rights. Costa Rica wondered what kind of investmentpromotion scheme would be adopted by Trinidad and Tobago after the dismantlement of the current
system of incentives, and on which key elements it would rely.
59. The representative of India stated that he believed that the documents provided for the review set
out clearly the problems and concerns of small economies in harnessing the dynamics of market access
opportunities as they sought to grow and develop. The authorities of Trinidad and Tobago had made
explicit in their trade policy initiatives that growth and expansion of their local productive base could only
be realized by the penetration of foreign markets. Trinidad and Tobago's policies were based on the
recognition that constraints posed by limited size and financial and economic resources could be offset
through the openness of the domestic market.WT/TPR/M/49
Page 15
60. The dual approach taken by the authorities was a pointer to the role of diversification of products
and markets in achieving an expanding market share in a sustained and aggressive manner. In this
context, India would like to commend the authorities for the reach of their country's external trade policy
and the plan of action that had been formulated for facilitating a meaningful integration of the local
economy with the globalized trading environment.
61. India noted that the process of liberalization and deregulation initiated by Trinidad and Tobago in
the mid 1980s had led to the elimination of a number of restrictions to trade, but that a complex system of
investment initiatives and high tariffs in some sectors remained. Previous speakers had noted the
beneficial aspect of the restructuring programme which envisaged the diversification of the economy
away from its dependence on the petroleum sector, by developing non-oil manufacturing activities as well
as services. This programme had envisaged a redefinition of the role of the Government itself. However,
he noted that a number of goods and services were subject to price controls and that tax concessions,
export allowances in the form of tax credits, and customs duty concessions underpinned the incentivesstructure for a wide range of manufacturing activities.  It would be useful to discuss the manner in which
the authorities proposed to address these aspects in their plan of action.
62. The representative of Barbados noted her country's close trade relationship with Trinidad and
Tobago, and stated that both countries shared similar experiences and faced the same challenges. Within
CARICOM, Trinidad and Tobago was Barbados' larges t trading partner; Barbados' exports to Trinidad
and Tobago accounted for 19% of total exports to CARICOM countries, and imports from Trinidad and
Tobago accounted for 72% of  total imports from CARICOM. Barbados welcomed Trinidad and Tobago's
effort to liberalize its economy as well as its WTO participation.
63. The representative of Australia congratulated Trinidad and Tobago on its effort to implement
economic reform and on amending domestic legislation to comply with WTO commitments. She
encouraged Trinidad and Tobago to continue on the path of further integration into the world trading
system.
64. The representative of Jamaica congratulated Trinidad and Tobago's on its impressive achievement
in economic development, in particular with regard to the role played by trade in its economy.  He praised
the international competitiveness achieved by the ener gy-related manufacturing sector in Trinidad and
Tobago as well as for light manufacturers.  This was a good example indicating that a small island
economy had not necessarily been constrained by its size "marginalized" in the global economy.  In this
regard, he recognized the important role played by the Government of Trinidad and Tobago in attracting
foreign investment in the energy and energy-related sectors.  Notwithstanding these achievements, he also
felt that there was a need for more sensitive treatment in some areas where neither Government nor the
private sector by itself could overcome the constraints of a small economy.  He also expressed concerns
about the impact of anti-dumping or other trade-restricting measures imposed on Trinidad and Tobago'seconomy imposed by its largest neighbour.WT/TPR/M/49
Page 16
VI. REPLIES BY THE REPRESENTATIVE OF TRINIDAD AND TOBAGO AND
ADDITIONAL COMMENTS
65. The replies by the representative of Trinidad and Tobago were divided into three main themes:
(i) economic environment;  (ii) trade policy measures;  and (iii) sectoral policies.  Written responses to
specific questions were circulated to members (Anne x II).  Trinidad and Tobago would provide further
answers in written form within the time allowed under the TPRM. Following the replies, the Chairpersonopened the floor to TPRB members for further comments and questions.
(i) Economic environment
66. The representative of Trinidad and Tobago appreciated delegations' interventions and comments.
He stressed that the various policy initiatives undertaken by Trinidad and Tobago were all consistent with
its WTO obligations. Referring to the role of the State in the economy, he stated that divestment had been
going on for some time, and the main problem now was how to treat successor companies. The Board of
Directors of all remaining enterprises comprised representatives from the private sector.
67. Trinidad and Tobago was a net food importer, importing around 75% of food requirements.
Recognizing the need for reform in the agricultural  sector, the representative of Trinidad and Tobago
noted that agricultural policies were under review, pa rticularly regarding import surcharges, sugar, and
the role of the state enterprise Caroni, Ltd. The case of this enterprise was special and a Ministerial
committee had been appointed to deal with its problems. A possible strategy would be to shift theactivities of Caroni away from sugar into industrial activities and services and to divide it into several
companies.
68. Virtually all price controls had been eliminated, except on three items:  sugar, pharmaceutical
products and school text books. Prohibited goods included in the Import Negative List were limited to a
few items, such as arms and ammunitions, drugs, left-hand drive vehicles and poultry parts, which wereconsidered to compete unfavourably with local production. The list included also cigarette paper, certain
pesticides, ships and boats under 250 TT, and oils and fats due to an agreement within CARICOM. Most
prohibitions were for safety or public health reasons.
69. Trinidad and Tobago had made considerable progress in the past 15 years in reducing its
dependency on the oil sector, as evidenced by the shift from oil to natural gas production. Natural gas wasused both as a final product and as a feedstock for downstream industries. The development of the latter
might result in Trinidad and Tobago becoming the la rgest exporter of methanol in the world in the near
future. Another evidence of diversification was the si gnificant increase in tourism experienced in recent
years.
70. The large number of projects undertaken in the energy sector in 1997 and 1998  had resulted in a
substantial increase in imports of construction material and capital equipment, and this had resulted in a
trade deficit, which was expected to be redressed in the near future. The fiscal and monetary policy mixapplied by the Government, combined with the application of incentive schemes had resulted in a
significant reduction in unemployment, from 19% in November 1995, to 13.5% in November 1998. The
Government hoped to reach single-digit unemployment levels by 2000. This would be aided by the
implementation of a large-scale tourism programme, the opening of an aluminium smelting plant, and the
creation of new down-stream natural gas industries. Regarding investment, existing legislation was beingamended and the new Investment Pr omotion Act would incorporate national treatment as one of its
features.WT/TPR/M/49
Page 17
71. The first discussant commended the representative of Trinidad and Tobago for his complete
answers. He thought that the rise in imports due to  an increase in investment flows was impressive. He
was also impressed by the economic reforms undertaken and the commitment to privatization.
72.  The second discussant noted that Trinidad and Tobago's investment regime had shown positive
achievements; she applauded the legal measures applied and the large investment inflows obtained. She
noted that the system of tax incentives applied was wide and ran across sectors. With respect toagricultural products, she expressed concern  regarding the high ratio of imports to domestic demand for
some products.
73. The representative of Haiti congratulated Trinidad and Tobago for their trade policy performance.
Haiti recognized the problems and constraints faced by Trinidad and Tobago as a small island. Haiti was
interested in being integrated in the group of Tr inidad and Tobago's trading partners. Trinidad and
Tobago was a model for Haiti.
74. The representative of Trinidad and Tobago  thanked Haiti for the remarks and advised that
Trinidad and Tobago was already Haiti's trading partner. He admitted that agriculture was the weak point
of Trinidad and Tobago's economy, but expected things would improve in the sector.
(ii) Trade policy measures
75. The representative of Trinidad and Tobago stat ed that his country would promptly notify its
anti-dumping legislation to the WTO.  Trinidad and Tobago did not apply any direct export subsidies,
since the Export Trade Administration facility had expired a few years before. The system of incentives
currently applied was mainly comprised of tax exemptions on income generated outside of Trinidad and
Tobago, and although WTO-consistent would be dismantled before 2003.  His country was making
efforts towards the enforcement of copyrights, including the introduction of the Banderole system.
Trinidad and Tobago was one of the few developing countries to have introduced wide-ranging TRIPSlegislation. He noted that Trinidad and Tobago had chosen not to delay the application of the WTO
Agreement on Customs Valuation as was its prerogative as a developing country.
76. Trinidad and Tobago had implemented the tariff reductions included in Phase IV of the
CARICOM schedule of reductions of  the CET; the maximum applied tariff on industrial products was
20%. Reductions on import surcharges on agricultural products had been implemented on a acceleratedschedule of five years, in accordance with what had been agreed in the Uruguay Round, with only a few
products scheduled for reductions over ten years. Import quotas had virtually been eliminated; the few
remaining quotas were applied for national security reasons, safety considerations, or to meet CARICOM
obligations. Items subject to quantitative restrictions represented a small share of Trinidad and Tobago's
imports, of between 5 and 10%.  The representative of Trinidad and Tobago noted that some local
standards had been developed, using international standards, basically to protect consumers and for public
health reasons. Standards were not meant to be non-tariff barriers to trade.  In cases where local standardsdid not exist, international standards were used.
77. The second discussant noted Trinidad and Tobago's effort in reducing import surcharges.
However, the accelerated implementation of reductions in the agricultural sector resulting from the
tariffication of quantitative restrictions in the Uruguay Round referred to tariffs and not to surcharges. The
problem in the case of Trinidad and Tobago was that in addition to tariffs there were surcharges andtogether these were well above bound rates in the WTO.WT/TPR/M/49
Page 18
78. In response, the representative of Trinidad and Tobago stated that surcharges had been used as
part of tariffication, and that they were being reduced to achieve compliance with bindings.
79. The representative of the United States noted Trinidad and Tobago's economic progress.  The
trade deficit registered in 1997 was due mainly to an increase in capital goods imports.  He expressed his
satisfaction with Trinidad and Tobago's implemen tation of the Agreement on Customs Valuation.  His
Government would appreciate a prompt notification of Trinidad and Tobago's anti-dumping law to the
WTO.  He noted that while Trinidad and Tobago had until 2003 to eliminate the indirect subsidies
provided by the incentives system, consideration should be given to an earlier phasing-out, to give
breathing space to the domestic industry. There was a lack of transparency regarding the assignation of
work permits. Referring to the list of products subject to licensing, as provided by the delegation of
Trinidad and Tobago, and the justifications presented, he recalled that obligations under the CARICOM
Treaty could not be used as a justification for licensing under the WTO. Similarly, national security could
not be used as a justification for the licensing in the case of cigarette paper.  With regard to importsurcharges, he encouraged Trinidad and Tobago to reduce them to their bound level of 15%.
80. In response, the representative of Trinidad and Tobago stated that his country would be working
to address the comments made by the United States.
81. The representative of Japan  noted that while most import surcharges had been reduced, Trinidad
and Tobago was still bound by its WTO commitment to lower them further to 15%. He asked whether
any import surcharges were applied on industrial pr oducts. He would also like to know whether all
standards were published and submitted to public comment in accordance with Article 2.9 of the
Agreement on Technical Barriers to Trade.
82. In response, the representative of Trinidad and Tobago noted that information regarding a
standard was made public before the standard was adopted, and that all standards used by his country
were WTO consistent.  He also noted that Trinidad and Tobago did not apply import surcharges on
industrial products, but only on a few agricultural products. Surcharges had been put in place as
temporary measures to remove the quantitative restrictions that existed under the Import Negative List,
and were now subject, except for sugar, icing sugar and poultry, to an accelerated phasing-out.
83. The representative of Canada sought clarification regarding the quantitative restrictions applied
on live poultry. He recalled that, under the Agreement on Agriculture, quantitative restrictions were no
longer allowed. He enquired whether the measures applied were in fact quantitative restrictions, or if they
were tariff quotas and noted the lack of transparency evidenced by the fact that the size of the quota was
not made public.
84. The representative of Trinidad and Tobago responded that the quantitative restrictions were
applied to comply with the Agreement on Sanitary and Phyto-Sanitary Measures and were not hidden
tariff quotas.
(iii) Sectoral policies
85. The representative of Trinidad and Tobago noted that his country had made substantial progress
toward production diversification, and that the eco nomy was undergoing a transformation, moving away
from oil to natural gas as well as to down-stream petroleum manufacturing, and services.  The energy
sector accounted now for 25% of GDP, although export earnings were still mainly dependent on thesector. Trinidad and Tobago had not as yet presented an offer regarding banking services but was working
on a position which would be submitted  to the WTO before the deadline agreed, in January 1999.
Regarding telecommunications, a committee had been appointed to review the operations of the sector.WT/TPR/M/49
Page 19
The review should be completed by December 1998 and implemented before mid-1999. In civil aviation,
Trinidad and Tobago was committed to an open-skies policy; operations would be expanded upon
completion of the new airport, currently under construction. Trinidad and Tobago had a special interest in
developing tourism activities, particularly in the area of integrated resorts, where development had been
lagging. A Tourism Development Bill was about to be submitted to Parliament.
86. The first discussant asked whether any actions had been taken at the CARICOM level to
liberalize financial services.
87. The representative of Trinidad and Tobago replied that two Trinidad ad Tobago banks were
already operating in CARICOM and other countries of the region, such as Venezuela. Trinidad and
Tobago insurance companies were also operating in the CARICOM area.WT/TPR/M/49
Page 20
VII. CONCLUDING REMARKS BY THE CHAIRPERSON
88. The first Trade Policy Review of Trinidad and Tobago was conducted by the TPR Body on 12-
13 November 1998.  These remarks, prepared on my own responsibility, are intended to summarize the
main points of the discussion;  they are not intended as a full report.  Further details of the discussion will
be fully reflected in the minutes.
89. The discussion developed under three main themes:  (i) economic environment;  (ii) trade policy
measures;  and (iii) sectoral policies.
(i) Economic environment
90. Members congratulated Trinidad and Tobago on its recent liberalization and economic reforms,
which had resulted in steady growth rates, low inflation and had attracted substantial foreign investment.
However, challenges remained, including dependency on the energy sector, high unemployment and a
still sizeable participation of the State in key sectors.  Also, the traditional trade surplus had turned to
deficit in 1997, primarily as a consequence of a surge in imports.  There was also concern about the effectof lower oil prices on export earnings and government revenue. Members welcomed the steps taken by
Trinidad and Tobago to develop a legal framework for competition policy and encouraged its prompt
implementation.  There was some worry about the range, cost and coherence of the various incentive
schemes, particularly with respect to investment, fo r which procedures were also sometimes cumbersome.
Members encouraged Trinidad and Tobago to continue to seek the diversification of economic activityand to accelerate the process of privatization, particularly in the agriculture and energy sectors.
91. Members commended Trinidad and Tobago on its co mmitments to the multilateral trading system
particularly as seen by the implementation of WTO agreements in some cases ahead of schedule. They
acknowledged the importance of Trinidad  and Tobago's role within CARICOM.
92. The representative of Trinidad and Tobago expressed his country's firm adherence to a rule-based
multilateral trading system.  His country had willingly assumed the obligations resulting from the
Uruguay Round. However, he felt that the WTO needed to address the particular interests and needs of
developing country members and to ensure that sustained efforts were made towards  balancing the
obligations assumed and the benefits derived from the system. He stressed the need for new approaches to
deal with the special and differential treatment for developing countries in the WTO, for example throughthe provision of technical assistance and through technology transfer. As a small island economy,
Trinidad and Tobago fully supported initiatives in in ternational fora to identify measures to integrate
small states into the global economy.
93. On the issues raised by Members, the representative of Trinidad and Tobago said his Government
had undertaken a trade reform programme to diversify the economy away from the petroleum sector and
to improve employment opportunities.  Unemployment had already declined significantly.  On the trade
deficit, capital imports had been an important factor.  He identified several sectors with the potential forsustainable export-led growth, including financia l services, agro-processing, software development,
specialty chemicals, engineering goods and services, and cultural tourism. Future economic strategies
would include continued efforts to attract foreign in vestment and to foster the development of small
businesses, tourism and light manufacturing sectors.  The representative noted that the process of
amending investment legislation would lead to a simplification of procedures and enhance transparency.WT/TPR/M/49
Page 21
(ii) Trade policy measures
94. Members welcomed Trinidad and Tobago's trade liberalization, including a lowering of tariffs,
virtual elimination of quantitative restrictions and a reduction in the scope of import licensing.  In
encouraging Trinidad and Tobago to continue with these efforts, Members raised a number of questions
particularly with respect to:  the gap between applied and bound tariff rates; high import surcharges on
agricultural products;  import licensing; notification of legislation dealing with anti-dumping andcountervailing measures;  standards and technical regulations;  tax allowances for exports; and intellectual
property rights, especially with respect to enforcement of copyrights.
95. In reply, the representative of Trinidad and Tobago stated that the maximum tariff rate had been
reduced from 45% to 20% over five years, and that there were no immediate plans to lower tariffs further.
Any alteration of the Common External Tariff w ould require approval from the CARICOM Heads of
Government. With regard to the gap between applied and bound tariffs for agricultural products, the
Government intended to re-examine bindings upon completion of a review of agricultural policies. Therepresentative noted that only a few items were currently subject to licencing, mainly for public safety
and national security reasons, as well as under CARICOM Treaty obligations. Trinidad and Tobago had
amended its anti-dumping legislation to ensure conformity with its WTO obligations; a notification in this
respect would shortly be submitted to the WTO. Apart from anti-dumping, Trinidad and Tobago had
amended its legislation and procedures in a number of areas, including TRIPS and customs valuation, andwas in the process of drafting or revising legislation in other areas.  The procedure for setting standards
was also explained.
96. With regard to export allowances, involving a tax credit based on certain export earnings, the
representative of Trinidad and Tobago said that, in accordance with the Budget Speech of 1998, they
would be eliminated in 2002. Trinidad and Tobago was addressing the problem of enforcement ofintellectual property rights, particularly regarding video and audio cassette piracy.  The representative of
Trinidad and Tobago stressed the need for technical as sistance to strengthen the capacity of small trading
partners to meet reporting obligations under the WTO and to fully exercise their rights.
(iii) Sectoral policies
97. Members acknowledged Trinidad and Tobago's efforts to diversify its economy,  reducing its
dependency on the energy sector by facilitating activity in non-petroleum manufacturing and services. On
agriculture, Members posed questions with regard to issues such as: high import surcharges, quantitative
restrictions applied to imports of live poultry, and the role of state-owned enterprises in the sector.
Regarding the energy sector, Trinidad and Tobago was encouraged to implement a more transparent
pricing structure for natural gas. On services, Members welcomed Trinidad and Tobago's commitments in
the GATS and encouraged a broadening of their scope, particularly in financial services.  A number of
questions were raised on specific issues, including "exclusive rights" provisions in telecommunications;
banking sector regulations and licensing requirements; transparency in the work permits regime;  and
licensing and cargo handling in both maritime and airline services.
98. The representative of Trinidad and Tobago stated that the high surcharges applied to the
agricultural sector would be reviewed before 2 004 with a view to ensuring compliance with WTO
commitments. Regarding maritime transport services, the Government was considering a proposal for the
restructuring of port operations. On financial services, national treatment was accorded to foreign
providers, and the Government was finalizing an offer on banking to be presented by January 1999. The
Government was pursuing the matter of exclusive rights on basic telecommunication services with theWT/TPR/M/49
Page 22
provider, with a view to advancing liberalization in this sector.  Amendments were being made to the
Telecommunications Act; these were expected to be approved by June 1999, allowing Trinidad and
Tobago to meet its GATS obligations. Detailed answers were also provided regarding civil aviation and
the issuance of work permits.
Conclusions
99. In conclusion, Members expressed appreciation for Trinidad and Tobago's liberalization efforts,
and prompt compliance with their obligations under the WTO.  Members strongly welcomed the many
steps that Trinidad and Tobago had already taken in becoming a more open and outward-oriented
economy that was integrated into the multilateral system;  they acknowledged the challenges faced by
Trinidad and Tobago as a small resource-based economy and appreciated the reform programme to
diversify the economy.  It was felt that a continuation of Trinidad and Tobago's trade-opening efforts
would consolidate the basis for economic diversific ation and for steady, sustainable growth;  in this
respect, the support of Trinidad and Tobago's trading partners would also be important.WT/TPR/M/49
Page 23
ANNEX I
ADVANCE WRITTEN QUESTIONS
QUESTIONS BY CANADA
Telecommunications
In the area of basic telecommunications services supplied through mode 1, we understand that
Trinidad and Tobago has committed to not impose any market access limitations, provided that the
supplier uses the network of the exclusive operator (qualification valid until 2010).  Para. 101 states,
"While basic telecommunications services are in the hands of the Trinidad and Tobago Limited (TSTT),
there are no restrictions on the provisions of value-added services using the network of the exclusive
service provider …".  Please clarify the phrase "in the hands of" TSTT as this seems to imply that
provision of basic telecom services is exclusively TSTT's.
According to Trinidad and Tobago's Schedule of Commitments, there will be no market access
limitations.  However, para. 102 states that "… Those who wish to provide the public terrestrial-based
mobile services, internet and internet access and teleconferencing for private use through cross-border and
commercial-presence modes must negotiate with TSTT …".  There appears to be an inconsistency
between its WTO commitments and this statement.  Kindly clarify.
QUESTIONS BY THE EUROPEAN UNION
Secretariat Report (WT/TPR/S/49)
Are the import surcharges on meat and milk going to be eliminated on schedule in 1998/99?
What is the rationale retaining the surcharges on sugar, icing sugar and poultry cuts? (paras. 16 and 29)
What steps are being taken to bring the customs valuation system formally into line with WTO
rules? (para. 17)
What is the purpose of retaining the licensing system for certain imports, now that QRs are no
longer applied?  Does the Government have plans for abolishing these residual controls? (para. 21)
Does the Government have any plans to eliminate residual price "controls"? (para. 25)
There is a large gap between the tariff bindings for agricultural products and the actual applied
tariffs.  Does the Government envisage lowering the bindings? (para. 28)
Given the excessive dependence on the energy sector, what strategy does the Government have
for economic diversification and employment creation?  Does the Government have a strategy for
reducing the persistently high levels of unemployment and pockets of poverty which exist in certain parts
of the country?
Government Report (WT/TPR/G/49)
Does the Government have a strategy for diverting itself of its holding in loss-making enterprises
such as Caroni? (para. 34)WT/TPR/M/49
Page 24
Does the Government envisage the need to revise the rules applying to the banking sector, for
example in terms of reserve asset ratios, in order to reduce the relatively high cost of capital in Trinidad
and Tobago, particularly for small enterprises? (paras. 13-15)
How does the Government reconcile its objective of pursuing integration efforts within the wider
Caribbean, particularly in the context of the FTAA negotiations, with the parallel initiative which has
recently begun in the post-Lomé context, to develop a CARIFORUM FAA with the EU? (paras. 51
and 58)
QUESTIONS BY HONG KONG, CHINA
Tariffs and additional duties
We note that while 44.9% of tariff lines are duty free, 19.2% are still subject to a tariff rate
between 15% and 20% after the implementation of  Phase IV of the CARICOM CET on 1 July 1998.
Moreover, more than 8% of items being exceptions of the CARICOM CET, are subject to a rate above
25%.  We would like to know if Trinidad and Tobago has any plan to further reduce and, as far aspossible, eliminate the tariffs (WT/TPR/S/49, pp. 34-35, para. 12 and Chart III.1).
We note that Trinidad and Tobago has put in place a scheduled, gradual reduction of import
surcharges, for some items, the surcharge will be reduced to 86% by 2004 under the reduction schedule.
We are interested to know whether Trinidad and Tobago has any plan to further reduce or eliminate such
surcharge as well as other duties and charges (WT/TPR/S/49, p. 43, para. 31).
Standards and technical regulations
We note that under the Standards Act 18 of 1997, the Bureau of Standards may recognize a
foreign standard for certification and label verification and may accept certificates from laboratories
outside the country.  We would like to know how many foreign standards/certificates have been so
recognized.  Are they done unilaterally or on the basis of MRAs? (WT/TPR/S/49, p. 52, para. 59)
Services overview
In Trinidad and Tobago's schedule, its horizontal commitments provide that the acquisition of
more than 30% of equity of publicly traded companies is subject to approval.  Will the Government
consider relaxing this limitation? (WT/TPR/S/49, p. 92, para. 81)
Financial services
We note that at the end of 1997, there were only five commercial banks and one of which is
wholly foreign owned.  Would like to know the general criteria for awarding licences.  Are local and
foreign services suppliers subject tot he same requirements? (WT/TPR/S/49, pp. 92-93, para. 85)
Telecommunications
We note that the exclusive rights on basic telecommunication services are given to
Telecommunication Services of Trinidad and Tobago  Ltd. (TSTT) which will expire by 2009 (Summary
Observations, para. 36).  Will the Government consider advancing the liberalization of this sector?(WT/TPR/S/49, p. 98, para. 99)WT/TPR/M/49
Page 25
We note that the Telecommunications Act is currently under revision to include changes
necessary to meet GATS obligations.  What is the expected timeframe for completion and approval by the
Parliament and the President? (WT/TPR/S/49, pp. 98-99, para. 100)
Maritime transport
It is mentioned that there are plans to commercialize cargo handling and marine services and that
the shares of the Port Authority will be sold to local and foreign investors.  Would like to know moreinformation on the plans including timeframe for im plementation and any limitations on foreign investors'
participation (WT/TPR/S/49, p. 100, para. 108).
Civil aviation
We note that air cargo handling services and airline facilities and repair services are open to
foreigners.  What are the general requirements for the provision of these services?  Are local and foreign
investors subject to the same requirements? (WT/TPR/S/49, p. 101, para. 113)
QUESTIONS BY JAPAN
Tariffs
It is reported that Trinidad and Tobago adopted the CARICOM CET on 1 January 1991 and put
in place the tariff reductions called for in Phase IV of the CET implementation process.  Have the tariff
reductions called for in Phase IV which is to reduce the CARICOM CET to 20% already been achieved?
If not, please explain the prospect for the reduction to 20% (paras. 11-12, p. 34 of the Secretariat report).
Other duties and taxes
It is reported that import surcharges of 60% on sugar, 75% on icing sugar, and 100% (or 86%
expected in 2004) on some poultry which are considerably exceeding the 15% level bound for "other
duties" during the Uruguay Round and included in Trin idad and Tobago's schedule of concessions.  Does
not this measure lack conformity with Article II of the GATT 1994?  (p. 43, para. 31)
Please provide information on whether there remains any other products, including industrial
products, on which "other duties" are levied.  Please also provide the rate of the "other duties", if any.
Standards and technical regulations
Are all the local standards created by the Trinidad and Tobago Bureau of Standards?  If not,
please explain on which products or in which field local standards are created by other organizations(p. 51, para. 56).
It is reported that standards, developed by a specifications committee, are published for comment
prior to adoption.  Is this publication made in addition to the procedures provided in Article 2.9 of the
TBT Agreement?  If so, please explain if such comment is open for foreign governments or foreign public
and private organizations (p. 51, para. 56).WT/TPR/M/49
Page 26
Competition policy
It is reported that a proposal for a Fair Trading Act was presented to Parliament in 1997.  Please
explain the present situation of the deliberation in the Parliament (para. 99, p. 62).
Banking services
Trinidad and Tobago has made no commitment in banking services.  Is there any regulation in the
Financial Institutions Act of 1993 which limits Market Access (Article XVI of the GATS) or NationalTreatment (Article XVII of the GATS)? (p. 93, para. 86)
Does Trinidad and Tobago intend to make any commitment in this field in the coming
negotiations?
Telecommunications Services
It is reported that the Telecommunications Act of 1991 is not in effect since it has yet to be
assented by the President and that the law currently under revision including changes necessary to meet
GATS obligations.  The Fourth Protocol entered into force on 5 February 1998 (p. 98, para. 100).  Pleaseprovide information on when the 1991 Act or the law which meets the GATS obligation is expected to be
in effect.
Trinidad and Tobago has committed to eliminate the monopoly of TSTT by 2010 and not to limit
on Market Access nor National Treatment as of 2010 in its Schedule of Specific Commitments.  Please
explain the schedule for the elimination of the monopoly status of the TSTT and the liberalization of thesector to meet this Commitment.
Maritime transport
It is reported that vessels wishing to engage in  coastal trade between the islands of Trinidad and
Tobago are required to obtain a licence and that this requirement is applied to both local and foreign
operators.  Please provide criteria to obtain the above-mentioned licence.  Do the same criteria applyequally to local and foreign operators? (p. 100, para. 106)
QUESTIONS BY THE UNITED STATES
Export Incentives
According to the report, Trinidad and Tobago applies no export taxes, no direct subsidies and no
export performance requirements.  An export allowance in the form of a tax credit is granted tocompanies exporting processed or manufactured products (excluding petrochemical and certain other
products) to non-CARICOM markets.  The tax credit covers the profits on the proportion of export sales
to total sales so that profits on exports are effectively tax exempt.  Other forms of export promotion to
extra-regional markets include assistance on a 50/50 cost-sharing basis to eligible exporters to assist them
with the cost of entering and competing in export markets.  Local tax law also allows for a deduction of
150% of expenses incurred in promoting the expa nsion into non-CARICOM markets.  Could Trinidad
and Tobago provide a list of all exporters who currently benefit from these programs?  Also could moreinformation be provided regarding how the tax credit is determined and what the eligibility requirements
are for the 50/50 cost-sharing program?  Finally, are there deadlines for the termination of any of the
programs?  The report indicates that the Foreign Investment Act of 1990 is expected to be replaced by aWT/TPR/M/49
Page 27
new investment Promotion Act which seeks to diversif y export-related foreign investment.  How will the
new law differ from the current Act?
Intellectual property rights
What is the status of Trinidad and Tobago's  efforts to sign the WIPO Copyright Treaty?
Trinidad and Tobago's 1997 Copyright Act became effective 1 October 1997.  While the Act
offers protections equivalent to those available in the United States, enforcement remains a concern.  TheCopyright Organization of Trinidad and Tobago has stepped up its enforcement of unauthorized use of
locally produced products, in particular audio cassettes and CDs of local artists such as Calypso artists.
However, at the same time, pirated foreign videos, especially U.S. movies and audio cassettes, are rented
and sold openly in the street and in stores.  What is the status of Trinidad and Tobago's enforcement
efforts on video piracy?
Agriculture
According to the report, import surcharges are currently applied on a number of agricultural
products.  For example, import surcharges of 60% on sugar, 75% on icing sugar, and 86% on some
poultry cuts are expected to remain in place beyond 2004, considerably exceeding the 15% level bound
during the Uruguay Round and included in Trinidad and Tobago's schedule of concessions.  What plans
does the GOTT have to bring these charges into line with bound duties?
Licences
Does Trinidad and Tobago plan to liberalize its licensing procedures?  Items on the Import
Negative List still require import licences and include a broad range of products:  livestock, meat, fish,
sugar, oils and fats, motor vehicles, cigarette papers, small ships and boats, and pesticides.
Anti-dumping/countervailing duties
The report states that Trinidad and Tobago substantially amended its Anti-Dumping and
Countervailing Duties law in 1995, but has not yet notified the WTO of this change.  When will the
formal notification occur?
Services
Telecommunications remains closed to new fore ign investment in key areas.  Local and
international telephone service is provided by a state-owned TSTT (51%) and Cable and Wireless (49%)monopoly.  We understand that Trinidad and Tobago maintains that its agreement with Cable and
Wireless does not guarantee a monopoly, but the Government's policy is, nonetheless, not to issue
licences to operate in this field to other providers.   Since the February 1996 commitment by Trinidad and
Tobago to allow open access and national treatment for basic (local and long-distance) services by 2010,
there has been some discussion of licensing other basic service providers within the next few years.
When does Trinidad and Tobago plan to begin to issue licences for additional basic service
telecommunication providers?  The Government has recently announced opening the cellular telephonemarket to competition by the end of the year.  This is in advance of Trinidad and Tobago's WTO
liberalization commitments.  Do you still expect to meet this announced date?  What are the
Government's plans to liberalize other segments of this sector?WT/TPR/M/49
Page 28
Work permits
Foreign firms have occasionally complained about inconsistencies and a lack of transparency in
the issuance of renewal of work permits, particularly for foreign executive level personnel.  The U.S./TT
BIT, which entered into force in 1996, contains a commi tment by the Parties which in spirit addresses this
issue.  The implication is that nationals of one party should be permitted to enter and remain in its
territory for purpose of establishing, developing, administering, or advising on the operation of an
investment to which they, or a company of the other Party that employs them, have committed (or are in
the process of committing) a substantial amount of capital or other resources.  it also permits covered
investments to engage top managerial personnel of their choice, regardless of nationality.  How is
Trinidad and Tobago addressing this continuing issue?
Civil aviation
Trinidad and Tobago has expressed interest in liberalizing its air transportation services and, in
the recent past, has indicated an interest in signing an Open Skies agreement with the United States.  Can
you tell us if such an agreement is still being contemplated?WT/TPR/M/49
Page 29
ANNEX II
RESPONSE TO QUESTIONS
I. ECONOMIC ENVIRONMENT
Macro-economic Stabilization
European Union
Does the Government envisage the need to revise the rules applying to the banking sector, for example in
terms of reserve asset ratios, in order to reduce the relatively high cost of capital in Trinidad and
Tobago, particularly for small enterprises? (paras. 13-15 of the Government Report).
The monetary authorities are committed to the reduction in the high reserve ratio in the banking
sector to more prudential levels over the medium term.
First Discussant, Andrew Stoler
If the visiting government team from Trinidad and Toba go could shed some light on the nature of the 44%
growth in imports in 1997, it would make an impo rtant contribution to our understanding of the current
macroeconomic context.
Imports of construction materials and machinery and transport equipment for the construction of
plants in the petrochemical sector were primarily responsible for the increase in imports in 1997.  These
new plants include an LNG, ammonia and methanol plants.  Increased investment in infrastructure
projects by the Government was also partly responsible for the increase in imports.
Mauritius
Could the visiting team from Trinidad and Tobago comment on whether other sectors have been
identified as alternate sources of foreign exchange?
The Government of Trinidad and Tobago has undertaken a trade reform programme which is
designed to diversify the economy away from it’s de pendence on petroleum.  In this regard the
government has identified the following sectors fo r the generation  of sustainable export-led growth.
These include:  (a) Financial services;  (b) agro-proce ssing;  (c) software development;  (d) speciality
chemicals e.g. essential oils;  (e) engineering goods and services e.g. design, maintenance and repair,
fabrication of parts;
India
We note that a number of goods and services are subject to price controls and that tax concessions,
export allowances in the form of tax credits and customs duty concessions underpin the incentives
structure for a wide range of manufacturing activities.  It would be useful to discuss in this Body the
manner in which the authorities propose to address these aspects in their plan of action.
In keeping with its objective of liberalizing and deregulating the local economy, Government
maintains price controls on only three items.  Howe ver, an incentive scheme has been implemented inWT/TPR/M/49
Page 30
order to foster the development of the private sector, which is another major objective of Trinidad and
Tobago’s industrialization thrust.  In addition, Government has removed import restrictions, exchange
rate controls and has divested its shareholdings in a number of state companies.  Future economic
strategies include continued efforts to attract foreign investors and promotion of the development of the
small business, tourism and light manufacturing sectors.
Structural Adjustment
Costa Rica
Can you provide additional information on the following: expropriation and compensation regimes;
transfer of capital; rules on senior management? Does FDI (its concept) include non-tangible goods like
Intellectual Property or any other rights?
Trinidad and Tobago’s Investment Regime is investor-friendly.  Bilateral Investment Treaties
(BITs) have been signed with the USA, France, the United Kingdom, Canada and the Dominican
Republic.  These agreements and national practice provide for prompt, adequate and fair compensation inthe event of expropriation and  free transfer of capital.  The Government admits senior personnel
necessary for the conclusion of an investment according to its work permit and immigration laws.  The
definition of investment used is a broad one involving both tangible and intangible property.
What type of investment promotion scheme is Trin idad and Tobago to use to promote growth of other
sectors ?  (In relation to reducing dependency from the oil sector), and what will be the cornerstone ofsuch a policy for attracting investments to Trinidad and Tobago?
Refer to previous answers on duty concession, tax incentives and the like.
First Discussant, Andrew L. Stoler
The documents provided for this review indica te that the Government of Trinidad and Tobago is
considering adopting a competition policy framework as  part of a proposed “Fair Trading Act”.  Would
the visiting Government team care to comment on the competitive situation prevailing in the financial
services sector and whether this situation might be, in part, a motivation for the introduction of
competition policy?
The origin of the competition policy was a logical sequence of the liberalization process instituted
by successive Governments following the structural adjustment program in the late 1980s.  The reformprocess included trade reform, financial reform and the de-monopolization of certain sectors.  The
financial services sector in Trinidad and Tobago is highly competitive.  Since the early 1990s the
financial system has been restructured and deregulated.  These changes have included the elimination of
selective credit controls, the elimination of capital controls and the strengthening of the supervisory and
regulatory framework.
Would the visiting Government team like to comment on why it feels the necessity to maintain
management control in partially privatized entities such as the Iron and Steel Company and the National
Flour Mills?
Government no longer has management control in the Iron and Steel Company, which is now
wholly-owned by the private sector.  With respect to the National Flour Mills and other companies in
which Government has some shareholding, the Board of Directors comprises appointees of the
Government along with appointees from the private sector which in turn appoints the managers.WT/TPR/M/49
Page 31
Caroni, the only producer of sugar in the country is 100% state-owned.  On page 9 of the government
submission, the Government of Trinidad and Tobago seems to suggest that it might be willing to divest its
interest in Caroni after reorganizing its management and operations.  Does the Government plan to
eventually sell off its interest in the sugar company?
A Ministerial Committee has been appointed to address the issues of restructuring and possible
divestment of Caroni (1975) Ltd.
Japan
It is reported that a proposal for a Fair Trading Act was presented to Parliament in 1997.  Please explain
the present situation of the deliberation in the Parliament (para. 99, p. 62).
The Fair Trading Bill is presently being reviewed by the Chief Parliamentary Counsel before
being presented to Cabinet.  It will then be placed before Parliament for its consideration.
European Commission
Does the Government have any plans to eliminate residual price “controls”? (para. 25)
Price controls remain only on certain basic pharmaceuticals, school text books and sugar.
Given the excessive dependence on the energy sector, what strategy does the Government have for
economic diversification and employment creation?  Does the Government have a strategy for reducing
the persistently high levels of unemployment and pockets of poverty which exist in certain parts of the
country?
The Government has defined its economic policy objectives in the following documents:  (a) The
Medium Term Policy Framework 1999-2001;  (b) The Industrial Policy 1996-2000;  (c) The Trade Policy
for Trinidad and Tobago 1997-2001;  (d) Creating A Nation of Entrepreneurs 1999-2001:  An Action
Plan For the Future Direction of Micro, Small and Medium Enterprises Development in Trinidad and
Tobago;  (e) The Tourism Master Plan.  Based on these documents the main thrust of Government’seconomic and industrial policies is the promotion of sustainable export-led growth and development
through the diversification of the economy away from its dependence on petroleum.  An additional
objective of an overall macro-economic policy is the reduction of unemployment largely through the
promotion of private sector growth and development.  In essence, the Government is aware of the fact
that the expansion of business activity will generate jobs and reduce the overall level of poverty in theeconomy.  As mentioned above, particular emphasis will be placed on the development of the small
business sector.  The Government holds the view that the establishment of small businesses will provide a
large number of unemployed persons with a source of self-generated income and has implemented a
number of measures to provide financial and technical assistance.  The results of these measures include:
an economy that has expanded by 5%; an unemployment rate that is the lowest in 14 years (13.4%); a rate
of inflation contained at 5%; an increase in foreign reserves to over US$1 billion; increased emphasis on
human resource development and social welfare programmes.WT/TPR/M/49
Page 32
Does the government have a strategy for divesting itself of its holding in loss-making enterprises such as
Caroni? (para. 34 of Government report)
Yes.  Cabinet has approved a broad philosophical approach for the divestment of the State sector,
including Caroni (1975) Ltd.  Refer to answer  provided to Mr Stoler’s question above.
Second Discussant, Claudia Orozco Jaramillo
As regards implementation of the Uruguay Round Ag reements, what is the view of the Trinidad and
Tobago delegation on the contribution that these Agreem ents have made to the government’s efforts to
modernize and diversify the economy?
The modernization and liberalization of the Trinidad and Tobago economy began unilaterally in
the early stages of the Uruguay Round.  It continued during the negotiations through, for example, the
schedule of reduction of the Common External Tariff and the introduction of trade remedy laws.  The
conclusion of the Round led to the amendment of existing legislation to bring these into line with our
multilateral obligations and provided a basis for increasing the pace of liberalization.  This placeddemands on our institutional capacity.  The dependence on export-led growth should have been supported
by the market openings of the Uruguay Round.  The Round provides a measure of stability and
predictability and should allow us to enhance our export performance.  On the other hand, preferences
have been eroded and a greater demand for full reciprocity has emerged.  While Trinidad and Tobago is
prepared to take up these challenges future agreements  will need to pay more heed to the diversity of the
membership.
Could the delegation of Trinidad and Tobago explain the need to have recourse to these Instruments,
particularly if one takes into account that the applied tariffs are lower than the bound tariffs, would also
be interesting to hear what would be done with these Instruments in the future.
The Government of Trinidad and Tobago has virtually removed its import restrictions.  As a
consequence of this fact, Anti-Dumping legislation was introduced in order to ensure that the domestic
market share of local manufacturers is not undermined by imported goods which are under-priced.  The
basic principle is that the local market has been liberalized, and although domestic manufacturers will
undoubtedly be exposed to competition from foreign goods, such competition should be fair and not due
to improper practices. In cognisance of this fact the Government of Trinidad and Tobago amended itsAnti-Dumping legislation in 1996 in order to ensure the following:  (i) WTO compatibility and
consistency;  (ii) that implementation of this legislation is conducted in accordance with the WTO
Agreements on the implementation of Anti-Dumping Rules.  The Government of Trinidad and Tobago
also plans to introduce a competition policy legislative framework to regulate the behaviour of
monopolies, cartels and similar institutions.  The objec tive of government in this instance is that of
ensuring that these organizations do not abuse their position of dominance in the local economy.  As
mentioned above this policy is consistent with the government’s objectives of fostering free and faircompetition in the local economy.
It would be interesting to hear comments on the fiscal incentives and the impact on the Government’s
ability to create a competitive environment which would require investments in physical infrastructure
and human development.
The fiscal incentive scheme is operated by the Government of Trinidad and Tobago in a bid to
accelerate the pace of industrialization in the local economy.  These incentives include a number of tax
exemptions for machinery, buildings and eq uipment which would undoubtedly enhance the humanWT/TPR/M/49
Page 33
resource base and the physical infrastructure of Trinidad and Tobago as firms seeking to benefit from
these incentives establish operations in the country.
Regional Arrangements
European Commission
How does the Government reconcile its objective of pursuing integration efforts within the wider
Caribbean, particularly in the context of the FTAA negotiations, with the parallel initiative which hasrecently begun in the post-Lomé context, to deve lop a CARIFORUM  FAA with the EU? (paras 51 & 58
of the Government report)
The Government does not envisage any conflict in adopting various approaches to expanding
market access.  We are committed to our CARICOM obligations and to negotiating a Free Trade Area of
the Americas.  On the other hand, no decision has been taken concerning the eventual negotiation of a
CARIFORUM Free Trade Agreement with the EU.  Any future arrangements will undoubtedly be
WTO-compatible.
II. TRADE POLICY MEASURES
Tariffs and Surcharges:  Applied rates and bindings
Japan
It is reported that Trinidad and Tobago adopted the CARICOM CET on 1 January 1991 and put in place
the tariff reductions calls for in Phase IV of CET implementation process.  Please explain the detail of thePhase IV, as well as Phase I to Phase III, of the CET implementation process. Are tariff reductions called
for in from Phase I to Phase III already put in place ? (Paras. 11 and 12, p. 34 of the Secretariat Report)
The Heads of CARICOM took a decision that the Common External Tariff (CET) will be
progressively reduced over a period of five y ears commencing from 1 January 1993.  This will be
achieved through four (4) phases culminating in a maximum rate of duty of 20% (with a few exceptions)from 1  January1998.  The plan for the phased reduction of tariffs is outlined in the following table:
    PHASE PERIOD OF APPLICATION RATE STRUCTURE
    I. 1 January 1993 to 31 December,1994 0-5% to 30-35%
    II. 1 January,1995 to 31 December,1996 0-5% to 25-30%
    III. 1 Januar y 1997 to 31 December 1997 0-5% to 20-25%
    IV. 1 January 1998 and onwards 0-5% to 20%
Based on this table it is apparent that Trinidad and Tobago has implemented all four (4) phases on
the scheduled dates within the appropriate time-frames.  Consequently in effect the maximum tariff
applicable to industrial products is 20%.WT/TPR/M/49
Page 34
Hong Kong, China (WT/TPR/S/49, pp. 34-35, para. 12 and Chart III.I)
We note that while 44.9% of tariff lines are duty free, 19.2% are still subject to a tariff rate between 15%
and 20% after the implementation of Phase IV of the CARICOM/CET on 1 July 1998.  Moreover, more
than 8% of items, being exceptions of the CARICOM/CE T, are subject to a rate above 25%.  We would
like to know if Trinidad and Tobago has any plan to further reduce and, as far as possible, eliminate the
tariffs.
The Government of Trinidad and Tobago may not alter the rates in the CET without the approval
of CARICOM Heads of Government.  Based on the f act that Trinidad and Tobago’s maximum tariffs
have been reduced from 45% to 20% over a five-year period there are no plans to reduce these tariffs any
further in the immediate future. (WT/TPR/S/49, p. 43, para. 31)
Other Duties and Taxes
Japan (para. 31, p. 43)
It is reported that import surcharges of 60% on sugar,75% on icing sugar, and 100% or 86% expected
in 2004 on some poultry which are considerably exceeding the 15% level bound for “other duties” during
the Uruguay Round and included in Trinidad and Tobago’s schedule of concessions.  Does not this
measure lack conformity with  Article II of the GATT 1994?
In the view of the Government of Trinidad and Tobago the implementation of these surcharges is
in conformity with Article II of the GATT.
Hong Kong, China
We note that Trinidad and Tobago has put in place a scheduled, gradual reduction of import surcharges,
for some items, these surcharges will be reduced to 86% by 2004 under the reduction schedule.  We are
interested to know whether Trinidad and Tobago has any plan to further reduce or eliminate such
surcharges as well as other duties and charges.
Trinidad and Tobago intends to maintain the current schedule of taxes and surcharges as specified
in the schedule submitted.  Notwithstanding, it should be noted that a study will shortly be commissioned
by the CARICOM Secretariat in order to review the Common External Tariff on agricultural
commodities, which is currently at 40%.
European Union
Are the import surcharges on meat and milk going to be eliminated on schedule in 1998/99?  What is the
rationale retaining the surcharges on sugar, icing sugar and poultry cuts? (para. 16) (para. 29)
The Government is committed to eliminating import surcharges on meat and milk as planned
in 1998/1999.  The Government has imposed surcharges on sugar, icing sugar and poultry cuts in order to
offer some measure of protection to the local producers while efforts are underway to enhance their
efficiency and international competitiveness.WT/TPR/M/49
Page 35
There is a large gap between the tariff bindings for agricultural products and the actual applied tariffs.
Does the Government envisage lowering the bindings? (para. 28)
As mentioned earlier the Government’s agricultural policies are being reviewed and consequently
present bindings will be re-examined upon the completion of these reviews.
What steps are being taken to bring the customs valuation system formally into line with WTO rules?
(para. 17)
Trinidad and Tobago’s customs valuation is  consistent with WTO rules as stated in
WT/TPR/S/49.
Licensing
United States
Does Trinidad and Tobago plan to liberalize its licensing procedures?  Items on the Import Negative List
still require import licences and include a broad range of products:  livestock, meat, fish sugar, oils and
fats motor vehicles, cigarette papers, small ships and boats, and pesticides.
Since 1992 the Government of Trinidad and Tobago has been liberalizing its licensing regime.  In
fact 95% of the products subjected to import licences have since been deleted from the Imports Negative
List.  The residual items which are still subject to the licensing regime are there for specific reasons as
detailed below:
Product Reason for Licencing Requirement
Live Poultry, Fish, shrimp, Lobs ter and Crabmeat – live, chilled
or frozenObligation under CARICOM Treaty
Coconuts (excluding coconut oil) Obligation under CARICOM Treaty
Oils and fats excluding coconut oil Obligation under CARICOM Treaty
Left-hand drive vehicles imported for specific purposes as
defined in the Customs Act Chapter 78:01Public Safety
Used right-hand drive vehicles excluding garbage compactors Public Safety
Cigarette Paper National Security
Ships and Boats under 250 tons National Security
Specific pesticides Public HealthWT/TPR/M/49
Page 36
European Union
What is the purpose of retaining the licensing syst em for certain imports, now that Qrs are no longer
applied?  Does the Government have plans for abolishing these residual controls? (para. 21)
See answer above on licensing.
Anti-dumping:  Notification of Act;  Procedures
United States
The report states that Trinidad and Tobago substa ntially amended its Anti-Dumping and Countervailing
Duties Law in 1995, but has not yet notified the WTO of this change.  When will the formal notification
occur?
Trinidad and Tobago in fact amended its Anti-dumping legislation in order to ensure conformity
with the WTO legislation.  The Government is preparing the relevant notification documents which will
shortly be submitted to the World Trade Organization Secretariat.
Standards and Technical Regulation
Hong Kong, China (WT/TPR/S/49, p. 52, para. 59)
We note that under the Standards Act 18 of 1997, the Bureau of Standards may recognize a foreign
standard for certification and label verification and may accept certificates from laboratories outside the
country.  We would like to know how many foreign st andards/certificates have been so recognized.  Are
they done unilaterally or on the basis of MRAs?
Standards recognized for product certification (Standards Mark) must first be declared as a
Standard by the Trinidad and Tobago Bureau of Standards (TTBS), as defined by the Standards Act
No. 18 of 1997, Part I and Part IV paras. 19-21.  So far no certification (Standards Mark) based on foreign
standards has been conducted.  However, the TTBS issues batch Certificates of Conformity for products
in accordance with any internationally recognized sta ndards.  This procedure has already been adopted for
products originating in the United Kingdom, Un ited States, and Member States of CARICOM.
Japan
It is reported that standards, developed by a Specification Committee, are published for comment prior to
adoption.  Is this publication made in addition to the procedures provided in Article 29 of the TBT
Agreement?  If so, please explain if such comment is open to foreign governments or foreign public andprivate organizations? (para. 56, p. 51)
Yes, this publication is made as part of TTBS practice in the development of a standard and it is
comparable with Article 29 of the TBT Agreement.  Yes, comments are opened to foreign governments,
or foreign public and private organizations .
Are all the local standards created by the Trinidad and Tobago Bureau of Standards?  If not, please
explain on which products or in which field local standards are created by other organizations.
All the local standards are created by the Bureau of Standards but sometimes other foreign
standards are used.  Please refer to  answer to Hong Kong, China above.WT/TPR/M/49
Page 37
Export Incentives
United States
According to the report, Trinidad and Tobago applies no export taxes, no direct subsidies and no export
performance requirements.  An expor t allowance in the form of a tax credit is granted to companies
exporting processed or manufactured products (excluding petrochemical and certain other products) to
non-CARICOM markets.  The tax credit covers the prof its on the proportion of export sales to total sales
so that profits on exports are effectively tax exempt .  Other forms of export promotion to extra-regional
markets include assistance on a 50/50 cost-sharing basis to eligible exporters to assist them with the cost
of entering and competing in export markets.  Local tax law also allows for a deduction of 150% of
expenses incurred in promoting the expansion into non-CARICOM  markets.  Could Trinidad and Tobago
provide a list of all exporters who currently benefit from those programs?  Also could more information
be provided regarding how the tax credit is determin ed and what the eligibility requirements are for the
50/50 cost-sharing program?  Finally, are there deadl ines for the termination of any of the programs?
The Export Allowance is utilized by claiming a tax credit based on the proportion of export sales
to total sales.  This is provided for under the Corporation Tax Act.  According to the Budget Speech 1998,
this allowance will be eliminated from 2002.  The 50/50 cost-sharing program refers to the Export
Technical Assistance Facility (ETAF), a matching grant programme, which was administered by the
Tourism and Industrial Development Company of Trin idad and Tobago Limited (TIDCO), and funded by
the World Bank.  The ETAF programme has been discontinued.
The report indicates that the Foreign Investment Act of 1990 is expected to be replaced by a new
investment Promotion Act which seeks to diversify ex port-related foreign investment.  How will the new
law differ from the current Act?
The Investment Promotion Act will replace the Foreign Investment Act of 1990.  Based on the
draft, the main differences will be in the promotional nature of the legislation, removing any distinction
between local and foreign investors.  The Act will include measures to streamline and accelerate the
decision-making process.
Costa Rica
What are the most significant changes that the new legislation would introduce?  (Referring to Foreign
Investment Law)
Refer to earlier answer.
TRIPS legislation
United States
What is the status of Trinidad and Tobago’s efforts to sign the WIPO Copyright Treaty?
The Government of Trinidad and Tobago has not taken a decision considering signature of the
WIPO Copyright Treaty.  Trinidad and Tobago did sign the Final Act at the conclusion of the DiplomaticConference.  It should be noted that Trinidad and To bago is a member of the Trademark Law Treaty and
the  Union for the Protection of New Plant Varieties (UPOV).WT/TPR/M/49
Page 38
Trinidad and Tobago’s 1997 Copyright Act became effective October 1, 1997.  While the Act offers
protection equivalent to those available in the United States, enforcement remains a concern.  The
Copyright Organization of Trinidad and Tobago has st epped up its enforcement of unauthorised use of
locally produced products, in particular audio cassette s and CDs of local artists such as Calypso artists.
However, at the same time, pirated foreign videos, especially U.S. movies and audio cassettes, are rented
and sold openly in the street and in stores.  What is the status of Trinidad and Tobago’s enforcementefforts on video piracy?
Trinidad and Tobago’s enforcement agencies are addressing the problem of video and audio
cassette piracy and are committed to enforcing domestic law in this area.  The Government is studying the
feasibility of introducing the Banderole system.
III. SECTORAL POLICIES
Agriculture:  tariffs and surcharges, sugar
Second Discussant:  Claudia Orozco Jaramillo
Could the delegation of Trinidad and Tobago comme nt on the reasons for the shortfall in domestic
production in the face of the prices that result from the high level of protection to which sugar exports are
subjected?
Historically Trinidad and Tobago was a net exporter of sugar.  Sugar exports from Trinidad and
Tobago benefit from preferential agreements with the European Union and the United States.  The sugarindustry is the major contributor to agricultural GDP and provides the bulk of the foreign exchange
earnings of the agricultural sector.  It is acknowledged that the industry has experienced some production
difficulties but these problems will be addressed by placing greater reliance on farmer-produced canes.
First Discussant:  Andrew L. Stoler
Would the visiting Government team like to comment on how it reconciles the apparent inconsistencies
between its declared objectives for the agriculture sector and the very many evident problems facing this
sector?
Government has implemented a three-year programme designed to restructure the agricultural
sector.  This programme will address land use policy and administration, the development of agro-based
enterprises and enhancing the competitiveness of the sector.
United States
According to the report, import surcharges are curren tly applied on a number of agricultural products.
For example, import surcharges of 60% on sugar, 75% on icing sugar, and 86% on some poultry cuts are
expected to remain in place beyond 2004, considerably exceeding the 15% level bound during the
Uruguay Round and included in Trinidad and Tobago’s schedule of concessions.
What plans does the Government of Trinidad and Tobago have to bring these charges into line with
bound duties?
Trinidad and Tobago is committed to reviewing th e surcharges on poultry parts, sugar and icing
sugar prior to 2004 with a view to ensuring compliance with its WTO commitments.WT/TPR/M/49
Page 39
Second Discussant:  Claudia Orozco Jaramillo
There has been a decrease in cocoa and coffee, two of the traditional export crops.  Is there any interest
in rehabilitating these industries?
During the period of high oil prices, the agricultural sector experienced a labour shortage
especially for labour intensive industries such as cocoa and coffee.  As a consequence many cocoa and
coffee estates were abandoned.  However Government intends to revive these industries through thefollowing initiatives: the provision of incentives for the rehabilitation and planting of new estates;  the
establishment of central fermentaries to improve the quality of beans;  the maintenance of germplasm;
the divestment of the Nonpareil Estate, a state-owned cocoa estate.
Energy
First Discussant:  Andrew L. Stoler
Would the visiting Government team care to share its views as to why, notwithstanding the introduction of
diversification strategies, the share of petroleum- related manufacturing increased importantly from
41.5% to 66.4 % of total manufacturing GDP in the 1992-96 period?
The impression is gained as a result of a broad definition of petroleum-related activities to include
natural gas-based manufacturing.  Activities such as ammonia, methanol and urea production are
included.  Trinidad and Tobago is a leading world exporter of these products.  Over the last five years the
contribution to GDP of the petroleum and energy-based industries has averaged 25%.
Services
(a) Services overview
Hong Kong, China (WT/TPR/S/49, p. 95, para. 81)
In Trinidad and Tobago’s schedule, its horizontal commitments provides that the acquisition of more than
30% of the equity of publicly traded companies is subject to approval.  Will the government considerrelaxing this limitation?
The Government is considering making certain chan ges to its legislation as it relates to foreign
holding of shares in publicly- traded companies.
(b) Financial services
Hong Kong, China (WT/TPR/S/49, pp. 92-93, para. 85)
We note that at the end of 1997, there were only five commercial banks and one of which is wholly
foreign owned.  Would like to know  the general cr iteria for awarding licenses.  Are local and foreign
services suppliers subject to the same requirements?
In Trinidad and Tobago the laws and regulations governing participation in the local financial
sector are not restrictive to foreign participation. Moreover, they do not discriminate between national and
foreign providers of financial services.  In the banking sector, the requirements stipulated for obtaining aWT/TPR/M/49
Page 40
licence are basically prudential, relating mainly to capital adequacy and the financial soundness of the
business.  The other requirements concern the necessary safeguards to ensure that prospective operators
are “fit and proper”.
Japan (p. 93, para. 86 )
Trinidad and Tobago has made no commitment in banking services.  Does Trinidad and Tobago intend to
make any commitment in this field in the coming negotiations?
Deadlines for making commitments in this area is January 1999 and the Government is still
finalizing its position in this area.
Is there any regulation in the Financial Institutions Act of 1993 which limits Market Access (Article XVI
of the GATS) or National Treatment (Article XVII of the GATS)?
At present the enabling legislation in the banking sector requires that foreign banks or financial
institutions wishing to conduct business in Trinidad a nd Tobago be incorporated in Trinidad and Tobago.
(c) Telecommunications services
Hong Kong, China (WT/TPR/S/49, p. 98, para. 99)
We note that the exclusive rights on basic telecommunication services are given to Telecommunication
Services of Trinidad and Tobago Ltd. (TSTT) whic h will expire by 2009 (Summary Observations,
para. 36).  Will the Government consider advancing the liberalization of this sector?
The Government of Trinidad and Tobago is pursuing the matter of the exclusive rights on basic
telecommunications services given to TSTT with a view to advancing the liberalization of this sector.
Hong Kong, China (WT/TPR/S/49, pp. 98-99, para. 100)
We note that the Telecommunications Act is currently under revision to include changes necessary to
meet GATS obligations.  What is the expected timeframe for completion and approval by the Parliament
and the President?
The expected time frame for the completion of the review of the Telecommunications Act is
December 1998.  Parliament and the President should approve the amendments by the end of June 1999.
Canada
In the area of basic telecommunications services supplied through mode I, we understand that Trinidad
and Tobago has committed not to impose any market access limitations, provided that the supplier usesthe network of the exclusive operator (qualification valid until 2010).  Paragraph 101 states, “While
basic telecommunications services are in the hands of the Telecommunication Services of Trinidad and
Tobago (TSTT), there are no restrictions on the provisions of value-added services using the network of
the exclusive service provider ...”.  Please clarify th e phase “in the hands of TSTT as this seems to imply
that provision of basic telecom services is exclusively TSTT’s.
A Cabinet-appointed Committee is presently reviewing this Agreement with a view to making
appropriate recommendations for the regulation of the telecommunications sector in Trinidad and
Tobago.WT/TPR/M/49
Page 41
According to Trinidad and Tobago’s Schedule of Commitments, there will be no market access
limitations.  However, paragraph 102 states that “… Those who wish to provide the public
terrestrial-based mobile services, internet and internet access and tele-conferencing for private use
through cross-boarder and commercial-presence modes must negotiate with TSTT …”.  There appears to
be an inconsistency between its WTO commitmen ts and this statement.  Kindly clarify.
A written answer will be submitted subsequently.
United States
Telecommunications remains closed to new foreign investment in key areas.  Local and international
telephone service is provided by a state-owned TSTT (51%) and Cable and Wireless (49%) monopoly.
We understand that Trinidad and Tobago maintains that its agreement with Cable and Wireless does not
guarantee a monopoly, but the government’s policy is, nonetheless, not to issue licenses to operate in this
field to other providers.  Since the February 1996 commitment by Trinidad and Tobago to allow open
access and national treatment for basic (local and long-distance) services by 2010, there has been somediscussion of licensing other basic service providers within the next few years.
The roles of both TSTT and Cable and Wireless in the telecommunications sector is currently
being reviewed by a Cabinet-appointed Committee which will make appropriate recommendations for
regulation of the sector.
When does Trinidad and Tobago plan to begin to issue licenses for additional basic service
telecommunication providers?
The Government of Trinidad and Tobago expects to be in a position to pursue the issuance of
licenses in 1999.
The government has recently announced opening the cellular telephone market to competition by the end
of the year.  This is in advance of Trinidad and Tobago’s WTO liberalization commitments.  Do you stillexpect to meet this announced date?  What are the government’s plans to liberalize other segments of this
sector?
A written answer will be provided subsequently.
Japan (p. 98, para. 100)
It is reported that the Telecommunications Act of 1991 is not in effect since it has yet to be assented to by
the President and that the law currently under revision including changes necessary to meet GATS
obligations.  The Fourth Protocol entered into force on the 5thFebruary 1998.  Please provide
information on when the 1991Act or the law which meet s the GATS obligation is expected to be in effect.
The Government of Trinidad and Tobago should be in a position to meet its GATS obligations by
mid-1999.WT/TPR/M/49
Page 42
Trinidad and Tobago has committed to eliminate the monopoly of TSTT by 2010 and not to limit Market
Access nor National Treatment as of 2010 in its Schedule of Specific Commitments.  Please explain the
schedule for the elimination of the monopoly status  of the TSTT and the liberalization of the sector to
meet this Commitment.
As mentioned above, a Cabinet-appointed Committee is reviewing TSTT’s role in the
telecommunications sector.
(d) Civil Aviation
Hong Kong, China (WT/TPR/S/49, p. 101, para. 113)
We note that air cargo handling services and airline facilities and repair services are open to foreigners.
What are the general requirements for the provision of these services?  Are local and foreign investors
subject to the same requirements?
There are three local companies presently engaged in ground handling activities.  However,
foreign airlines can also undertake their own cargo handling operations.  As far as general requirementsare concerned, both  local and foreign firms must obtain prior authorization from the Airports Authority
to operate a cargo handling service and must demonstrate the capability to perform such services,
e.g. having trained personnel, necessary equipment, etc.
United States
Trinidad and Tobago has expressed interest in liberalizing its air transportation services and, in the
recent past, has indicated an interest in signing an Open Skies Agreement with the United States.  Can
you tell us if such an Agreement is still being contemplated?
The Trinidad and Tobago Government has taken a decision to deal with the Open Skies
Agreement on a CARICOM level.  CARICOM has formed a Negotiating Team to deal with the matter.
This Team is to chaired by Dr. Kenneth Rattray of  Jamaica with Mr. Reginald Dumas of Trinidad and
Tobago as the Vice-Chairman.
(e) Maritime Transport
Hong Kong, China (WT/TPR/S/49, p. 100, para. 108)
It is mentioned that there are plans to commercialize cargo handling and marine services and that the
shares of the Port Authority will be sold to loca l and foreign investors.  We would like to know more
information on the plans including timeframe fo r implementation and any limitations on foreign
investors’ participation.
The Government is considering a proposal for the restructuring of port operations.WT/TPR/M/49
Page 43
United States (p. 100, para. 106)
It is reported that vessels wishing to engage in coastal trade between the islands of Trinidad and Tobago
are required to obtain a license and that this requirement is applied to both local and foreign operators.
Please provide criteria to obtain the above mentioned license.  Do the same criteria apply equally to local
and foreign operators?
Droghers are vessels employed in the conveyance of cargo from some part of Trinidad and
Tobago to some other part.  To operate as droghers, the vessels must be registered in accordance with the
Droghers Act, Chapter 50:07 of the Laws of Trinidad and Tobago and must either:  (1) be registered
either:  (a) in Trinidad and Tobago under the Shipping Act, i.e. vessels of 24 metres in length and over or
in a foreign state;  or (b) under the Motor Launches Act, Chapter 50:08 of the laws of Trinidad and
Tobago (i.e. vessels under twenty-four (24) metres in length);  (2) provide evidence of third party
liability;  and (3) provide evidence of meeting applicable  safety standards.  All Droghers must be issued a
Certificate of Drogher by the maritime Services Division.  This certificate is valid until 31 December ofthe year in which the Certificate is issued.  A licence to Navigate Coastwise is issued by the Customs and
Excise Division based on the Drogher Certificate. With  regard to licensing requirements, the owner of a
drogher must submit in triplicate a “Declaration of Ownership” Form together with the following:
(a) proof of registration;  (b) international tonnage;  (c) valid safety certificates (load line, safety
construction, equipment and radio or exemption for vessels over 500 tons-gross tonnage);  (d) certificateof insurance against damage to third party.  Finally, with regard to fees, the Drogher fee is calculated
using the rate of $1.60 per tonne or part thereof.  In no case shall the fee be less than $10.00.
(f) Work Permits
United States
Foreign firms have occasionally complained about inconsistencies and a lack of transparency in the
issuance of renewal of work permits, particularly for foreign executive level personnel.  The U.S./TT BIT,
which entered into force in 1996, contains a commitment by the Parties which in spirit addresses this
issue.  The implication is that nationals of one party should be permitted to enter and remain in its
territory for purpose of establishing, developing, administering, or advising on the operation of an
investment to which they, or a company of the othe r Party that employs them have committed (or are in
the process of committing) a substantial amount of capi tal or other resources.  It also permits covered
investments to engage top managerial  personnel of their choice, regardless of nationality.  How is
Trinidad and Tobago addressing this continuing issue?
The work permit policy enables any investor w ho requires management with certain skills to be
employed in Trinidad and Tobago to benefit from this provision.  Several thousand expatriates already
reside and work in Trinidad and Tobago.  Some have lived in the country for a number of years.  Trinidad
and Tobago has not enjoyed the same level of reciprocity from developed countries.  Where work permitshave either been denied or not renewed the criteria have not been observed.  The efficiency of the system
is reflected in the fact that between 1996 and 1997, 3990 work permits were issued.
__________