ENERGY CHAMBER SAYS GETTING FOREX MAJOR HEADACHE

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The Energy Chamber said "accessing foreign exchange is a major headache for many" of its member  companies, especially small to medium-sized service companies and contractors.  But the Chamber says an increase in local oil and gas production can help bring in more foreign exchange to this country.  This, as the Finance Minister, earlier this week, explained why the Government wants energy sector companies that earn their income in U.S. dollars to pay all their taxes in U.S. dollars.  Juhel Browne reports.

Transcript

00:00In its latest blog posted on its website on Thursday, the Energy Chamber said accessing

00:05foreign exchange is a major headache for many of its member companies, especially small

00:10to medium-sized service companies and contractors.

00:14It added these companies need foreign exchange to procure equipment and supplies, as well

00:20as to pay for things like international certification fees and specialised training.

00:25And the Energy Chamber said that, just like companies outside of the energy sector, many

00:30of its members are juggling various accounts with different banks to be able to access

00:35the foreign exchange that they require.

00:38The Energy Chamber's blog on Thursday followed a virtual media conference held by Finance

00:42Minister Colin Imbert on Tuesday, in which he addressed several matters, including foreign

00:47exchange.

00:48In fact, 80% of the foreign exchange customers at the Ex-Im Bank are small and medium enterprises,

00:57not the large ones at all.

00:59In fact, the Ex-Im Bank goes out of its way to help these small enterprises.

01:04The Energy Chamber said while many of its members are facing the same difficulties as

01:08companies in other sectors, the energy sector is also at the centre of efforts to resolve

01:13the issue of foreign exchange shortages.

01:16The Energy Chamber said, firstly and most obviously, its advocacy work, focused on increasing

01:22oil and gas supply through increased upstream investment, has a direct impact on foreign

01:27exchange availability.

01:29On Tuesday, the Finance Minister said that most of the products produced by the upstreamers,

01:34Atlantic LNG and the plants in Point Visas, are not sold locally, as he elaborated on

01:40his announcement in the Budget that energy sector companies operating in Trinidad and

01:44Tobago should pay all their taxes in US dollars.

02:14It only stands to reason that they should pay their taxes in US dollars, and this has

02:18not been happening.

02:20The Finance Minister also spoke about his plans to talk with various stakeholders about

02:25what he called the honour system for the distribution of foreign exchange that has been in place

02:30for the past 25 years in Trinidad and Tobago, and whether it should be replaced with a more

02:36regulated system.

02:37Those talks are to include the energy sector.

02:40And therefore I will be talking to them over the next couple of months to encourage them

02:46to pay their taxes in US dollars, because if they do, it boosts the resources, obviously.

02:50And then if we introduce this new system, or let us not call it new, restructured system,

02:56where based on consultation with stakeholders, we come up now with categories that should

03:01benefit from the government's injection of forex.

03:03We'll have more forex, put more into the system, but in a much more structured way.

03:08The Energy Chamber said the increase in production of natural gas has led to significantly lower

03:13exports of LNG, methanol, ammonia and other commodities, our major foreign exchange earning

03:19exports.

03:20But if there can be a turnaround, resulting in an increase in production, then exports

03:25rise and more foreign exchange will be available.

03:29Jule Brown, TV6 News.

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