US TARIFFS & CBAM CAN BE AN OPPORTUITY FOR T&T?

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Pending new US trade tariffs as well as European Union carbon reduction taxes pose challenges for local exporters but can also present opportunities for innovation.  This is according to one Senior Fellow at UWI who spoke on the matter during a conference hosted by the Energy Chamber on sustainable energy in the Caribbean.  Juhel Browne reports.

Transcript

00:00On day one of the 2025 Caribbean Sustainable Energy Conference at the Hilton Trinidad,

00:06the Energy Chamber's chairperson, Marla Baliraj, outlined a new global reality which Trinidad and Tobago has not escaped

00:13as the Twin Islands Republic continues to earn much of its revenue from its crude oil and natural gas sectors.

00:20Since we met here one year ago, there have been major shifts in the global landscape for sustainable energy.

00:26We have seen some major economies cancelling or restructuring previous policies

00:32in order to encourage investments into lower carbon energy sources.

00:36The U.S. being the most obvious case, but they are not alone,

00:41as many other countries have either scaled back their subsidies or pushed back regulatory deadlines

00:47that has been driving the energy transition.

00:49The Energy Chamber's chairperson said this has resulted in some major global energy companies

00:55adjusting their ambitions for the energy transition.

00:59Day two of the conference saw a continuation of the focus on the recent change in U.S. energy and trade policies,

01:05as well as the European Union's Carbon Border Adjustment Mechanism, or CBA.

01:11Among those who spoke on that issue was Dr. Priya Mohan,

01:15Senior Fellow at the Sir Arthur Lewis Institute of Social and Economic Studies at the University of the West Indies.

01:22At U.S. we have done studies looking at the impact of CBAM on Trinidad and Tobago,

01:29and looking at the products contained in the EU CBAM,

01:34currently 33% of our total exports would be affected by these taxes,

01:39which translate to 13.5% of our GDP.

01:43Dr. Mohan said 37% of Trinidad and Tobago's exports go to the U.S.,

01:48and a large amount of those exports will be affected by those taxes.

01:52She pointed out that it's going to take time for a transition to cleaner fuels and cleaner technology.

01:59Of course, we can't ignore Trump tariffs, and of course, we've been given a 10% tariff.

02:07A lot of our exports are exempt, crude petroleum, natural gas, critical minerals.

02:13But what the tariffs do, they create a lot of uncertainty in that the preferential treatment

02:19we would have enjoyed previously with the U.S. may no longer be on the table,

02:24and that uncertainty certainly is not good for business.

02:28However, there was an expression of optimism.

02:30So while the challenges are significant, these issues present an opportunity for our exporters

02:38to innovate, diversify, and capture new value in the global marketplace.

02:43So the global drive towards decarbonization driven by CBAM is a powerful catalyst for our own transformation.

02:51Dr. Mohan said this should foster innovation in areas such as carbon capture and storage,

02:56energy efficiency, and blended fuels, which were examined during panel discussions

03:01at the Caribbean Sustainable Energy Conference.

03:04It also creates an opportunity for us to create our own domestic market,

03:09our own credit market domestically.

03:12If we pay the carbon tax within our jurisdiction,

03:15we are exempt from paying the taxes to the EU, the UK, the U.S.

03:20Reference was also made to U.S. $11 to $13 billion in funding

03:25under one international program towards net zero carbon goals

03:29that could be accessed by small island states like Trinidad and Tobago.

03:35Jewel Brown, TV6 News.

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