I would like to comment on a letter that was published in the newspapers titled “Tourism our sleeping economic tiger”. I concur with the points raised in this letter however, there needs to be further discussion around this topic. It is agreed that given the tourism product that we have Trinidad and Tobago (a unique and idiosyncratic cultural experience coupled with a homogenous sun, sea and sand offering that is common with other Caribbean islands) we could and should do better in this industry. However, we continue to offer a substandard product. One of the chief factors which contributes to this is the abysmal level of customer service in our country. Almost daily we experience poor customer service, so much so that this has become ingrained in our psyche. Another is the lack of strategic vision of what we want defined as out tourism product and truly implementing the necessary steps to becoming the world’s best in that product offering. For example, Costa Rica has worked extremely hard on defining itself as one of the premiere eco-tourism destinations of the world and now they are reaping the rewards of such a strategy. Third but certainly not least is the level of crime in this country. This needs not be explained further.
Tourism is an industry, which if properly developed, could serve to diversify the economy. However, it should never form a significant portion of a country’s economic mix. This is a universal fact. The Caribbean tourism product depends on the developed world having high levels of disposable income. In periods of economic hardship, Caribbean getaways would certainly be deferred to be taken at better economic times. In short, the demand for a Caribbean holiday to a tourist is highly income elastic, which means income from this industry is very unstable and highly cyclic. A country will be at the mercy of the world’s economic cycle if it is highly dependent on tourism, as is the case of some of our Caribbean neighbours. So to make a significant move into this area would be creating a future economic scenario in which we have little or no control over our destiny.
Our diversification efforts should focus on areas for which there is a worldwide inelastic demand. We have been blessed with significant hydrocarbon resources, which incidentally is an industry with a very inelastic demand. This ensures that we have a steady, predictable stream of revenue. We should focus on areas that will ensure such a predictable future stream of income such as technology development, financial services and higher education. In short we need to emulate models like what wassuccessfully achieved in Singapore, South Korea and Dubai. We would do well to do this.
Fulbright Scholar in Economics
Harvard Business School Alumni