Address by the Honourable Patrick Manning Prime Minister of Trinidad and Tobago at the Opening of a Seminar on “Developing Viable Small and Medium-sized Enterprises in Trinidad and Tobago”
HYATT Regency Hotel
Monday 24th. November 2008
I welcome this opportunity to address you at the start of what is clearly going to be a very intensive day of deliberations on furthering the development of Small and Medium –sized Enterprises in Trinidad and Tobago. This is a critical matter, especially at this time of economic slowdown, here at home and abroad. I thank all the organisers of this important seminar, headed by the Central Bank, and including the Inter American Development Bank and the four particular Ministries of the Government of Trinidad and Tobago. We welcome the participation of all institutions and individuals, especially those who journeyed to our country for this dialogue. We look forward to the ideas that will emanate from today’s conversation, as, like all other nations, we face the reality of a looming global recession and its very challenging consequences.
Our Philosophical Approach to SMEs
We subscribe to the view that Small and Medium Enterprises have a critical role to play in the productivity and resilience of any economy; as well as in the strength and stability of the society. They are indeed a key instrument of sustainable social and economic progress.
Perhaps more than any other area of business activity, Small and Medium enterprises epitomize that inextricable link between economics and human and social development. Where SMEs thrive, the society is stronger and more stable, and individuals and communities have the greater opportunity for progress and for contribution to national development; where SMEs struggle, there can be disaffection, deprivation and marginalization of the citizens at the middle and lower levels of the society.
Indeed there is hardly a middle society without a thriving small and medium enterprise sector. On the other hand, with SMEs, you almost always have an expanding middle class which in turn unleashes the levels of human energy, creativity, entrepreneurship and dynamism that positively influence, and can even incorporate, almost the entire society in its movement forward.
SMEs are therefore at the heart and foundational levels of the successful society, stimulating and propelling the country forward. They are among the greatest generators of employment and they spread the opportunities for development to all levels of the society.
They promote stability by being woven into the fabric of the lives of the people. They are accessible and familiar, part of the community landscape, seen for their value in providing indispensable goods and services. Where SMEs thrive, the people feel more attuned to the general direction of the country. Feelings of alienation are significantly reduced. The stability of the society is strengthened.
SMEs are therefore especially needed at this time of economic slowdown. The Government will continue to do all that is necessary to strengthen the Small and Medium Enterprise Sector in Trinidad and Tobago.
Over the last eight years, we have placed special focus on the development of this sector. Through our relevant agencies, we continue to provide comprehensive technical and financial support to help SMEs in the development of their potential. Through the Business Development Corporation, for example, we have already issued almost five hundred loan guarantees amounting to close to thirty million dollars for small and medium enterprise development in sectors including printing and packaging, electronics, agriculture, food and beverage, light manufacturing and distribution. Additionally, over fifteen million dollars in leases have been disbursed through the Leasing Company for the acquisition of equipment for plant upgrading. We have also provided tax holidays for this sector.
At the National Enterprise Development Company (NEDCO), we increased the entry level funding from $50,000 to $100,000; and those who successfully service their loans are able to access additional funding up to $ 250,000. We provide expert advice on management, marketing and technology utilization for viability in this competitive world. NEDCO has also trained thousands of persons in various aspects of small business management, helping them towards success and growth, making it possible for the transition of business operations from micro to small; from medium to big.
Under our Fair Shares programme, the intention is that contracts of one million dollars will be reserved exclusively for registered small businesses of varying sizes; and in many Government Departments today , over 10% of all contracts are reserved for the small man. Four of our special purpose state enterprises, are also providing opportunities to small businesses, especially small contractors, to participate in the development programmes on which they are engaged in our communities.
Additionally, approved small businesses in a regional development project, pay no tax on profits for five years; and we also exempt the gross sales of these companies from the business levy for a similar period.
ICT in SMEs
We also fully recognize that for their viability and improved competitiveness, there must be the fullest possible deployment of information and communication technology in the operations of the Small and Medium Enterprise Sector. Training is provided at several levels for the acquisition of ICT skills by our SME entrepreneurs.
Also, EnterpriseNeTT, the Online Micro, Small and Medium-sized Enterprise (MSME) Business to Business (B2B) Marketplace has been established as a pilot. Work on this project now centres on its full deployment combined with the creation of a comprehensive e-Business Strategy to provide, among other things, a global listing of trade events, Internet market research, practical tools to help local MSMEs with the export process, and quick information on new business opportunities. Thousands of companies are currently registered on EnterpriseNeTT, which will play a key role in supporting Vision 2020’s developmental pillar of Enabling Competitive Business. In addition, we have established an e-Business Roundtable as a public/private sector collaborative mechanism aimed at increasing the adoption of ICTs among business community, including SMEs, as well as advancing ICT as an industry in itself.
In the meantime we are formulating a National Policy on e-Business and e-Commerce including proposals for Tax & Fiscal Incentives; a Code of Consumer Protection for e-Commerce; a National Strategy for Electronic Payments ; and the development of a B2C e-Commerce strategy. We are about to lay in Parliament The Electronics Transactions Bill and The Data Protection and Privacy Bill. We are creating the facilitative environment for our SMEs and the entire business community to incorporate the technology in their operations.
Success with SMEs
Our initiatives in the Small and Medium Enterprise Sector has produced tremendous growth. During the last five years, for example, we facilitated the development of over ten thousand small and medium enterprises which have created wealth and employment and contributed to strengthening the social fabric of Trinidad and Tobago. We will be unrelenting in our efforts to improve the strength of this sector.
SMEs and Economic Expansion
Ladies and Gentlemen, as I indicated in my address to the nation last week, we must now make adjustments in expenditure in the light of falling revenues from a global economic slowdown. But one thing must be made clear. We will not yield to economic contraction without a fight. We will not succumb so easily. We will do our best to promote business expansion because we know that the continued creation of wealth has to be a key weapon in the fight against any threatening stagnation.
Therefore, as far as is possible, we will pursue our planned economic expansion and diversification in the energy sector and also through the establishment of certain strategic gas- based industries in plastics, aluminum and iron and steel, as well as the intensification of our efforts in other key areas including agriculture, and the information industries. We will also continue our focus on the already determined new areas like Merchant Marine; Fish and Fish Processing; Yachting; Music and Entertainment; Film, and Food and Beverage.
The Small and Medium Enterprise Sector will be both beneficiary and instrument of this effort which will generate new industrial activity in Trinidad and Tobago. Our planned strategic industries, for example, will provide the platform for the creation of the great many products for use in manufacturing, construction, agriculture and agri-business, transportation, health care, and in the household, among others. Through this activity, all other sectors including services, retail and construction will have the chance to sustain if not expand their operations in these times of threatening economic slowdown. SMEs will undoubtedly emerge in all these sectors of the economy to play their indispensable role in national development.
We will do our best to ensure that the Small and Medium Enterprises have all possible opportunities for participation, and expansion in these challenging times. It is with this sector that we incubate our entrepreneurial talent. We can further nurture the culture of entrepreneurship and we have one of the best instruments for a more equitable distribution of the nation’s wealth and for the structural transformation of our communities.
This sector is indispensable to the national economic momentum. It is needed to expand the economic base of the society and to be an essential part of the preparation for the even greater growth that will come when the economic problems are rectified, as they certainly will, at the global level.
I therefore once again thank you all for gathering to pursue ways to further facilitate the growth of this critical sector. I wish you most fruitful deliberations and I have no doubt that the Government would derive great benefits from your wise counsel.
Thank you, Ladies and Gentlemen.