1. Sector Overview
Trinidad and Tobago (T&T), a twin-island state located in the southernmost part of the Caribbean, has earned a reputation as a leader in the energy and petrochemical sector in the Caribbean, as well as for being the most industrialized nation of this region. It is a leader in ammonia exports, and has become the world’s leading exporter of methanol and fifth largest exporter of liquefied natural gas (LNG). In fact, it is the largest supplier of methanol and LNG to the U.S. With a population of approximately 1.3 million people, T&T has strong manufacturing, construction, and finance and insurance sectors, all driven by the energy sector. The energy sector, comprising oil, LNG and gas-based industries, accounts for over 40% of gross domestic product (GDP), over 60% of government revenues and 90% of exports. GDP was estimated at approximately TT$114.5 billion in 2006, while per capita income was US$14,790 in 2006. The services sector grew by 5.9%, led by construction sector growth resulting from T&T government investment in housing and infrastructure, and ongoing projects in the energy sector.
Trinidad and Tobago’s heightened level of construction activity-fuelled mainly by oil and gas revenues-include projects undertaken by the Trinidad and Tobago government in housing and infrastructure, ongoing projects in the energy sector, as well as real estate development by the private sector. The construction sector expanded by 5.56% in the first quarter of 2006, having been stimulated by government projects and the government’s robust housing drive. In 2006, the sector contributed 8.4% to GDP, with its economic activity up by TT$1.86 billion over the level in 2005.
The construction boom is evident everywhere in Trinidad and Tobago. From individuals building new homes to business people opening new retail outlets, from massive low-cost housing programs to luxurious million-dollar gated communities, from refurbishment of existing office buildings to new mega-office and hotel complexes, performing arts centres and stadiums, from the paving of existing highways to building of entirely new roads, from the laying of new gas pipelines to the development of rail systems and new industrial estates-every aspect of the construction industry has been drafted into the country’s massive private and public sector construction program.
Meanwhile, private sector residential construction has been stimulated by a property boom, with some real estate prices increasing by over 50% last year. For low- and middle-income households, the government is pursuing an ambitious housing construction program aimed at delivering 100,000 houses in 10 years. The mammoth East Port of Spain Redevelopment Project is also set to start in early 2008 under the management of the East Port of Spain Development Company Ltd. The Housing Development Corporation plans to demolish 682 rundown apartments to make way for about 2,000 new housing units.
During 2007, the value of construction and quarrying activity within Trinidad increased in real terms by 5.2% to TT$6,658.3 million, an acceleration of the 4.3% increase registered during 2006. The improved performance reflects the government’s continued investment in upgrading the country’s public infrastructure, through the launch of a number of new projects, including the highway interchange, alongside ongoing works such as its intensive housing construction drive. The surge in construction activity over the past five years has exposed the sector’s physical and human resources limitations. Under the circumstances, the country’s construction thrust has become increasingly dependent on the import of foreign skills, labour and capital equipment.
2. Market and Sector Challenges (Strengths and Weaknesses)
Domestic competition in building products is fierce, with several manufacturing firms being solidly established and having integrated distribution channels. Many international firms are also well established and have manufacturing and distribution operations in the Trinidad and Tobago market.
Canadian contractors active in the sector include consulting engineering firms such as Genivar, Dessau Soprin, Ellis Don, NDLea (recently acquired by Marshall Macklin and Monaghan International Inc.), Stantec and Cansult. Companies registered in China, France, Malaysia and the Turks and Caicos Islands are currently contracted for projects worth US$472 million.
The construction boom has translated into greater demand for contractors and construction workers, and the government has had to temporarily import labour from outside the Caribbean region to complete some of the major construction projects. There are shortages of all the skills needed in construction, for example, steel-bending and steel-fixing specialists, crane operators, equipment operators, mechanics, masons, plumbers, scaffolding erectors and joiners.
There are only about six construction companies in the country that can handle projects valued at between US$15 million and US$48 million. As a result, a number of foreign-based companies have been given contracts to build projects. Examples include Johnston International (Turks and Caicos), design and build for the Chancery Lane complex, San Fernando (US$50 million); Bouygues Batiment International (France), through a Bouygues Batiment T&T Construction Company-HCL joint venture (US$265 million); Sunway Construction Caribbean (Malaysia), campus for Ministry of Legal Affairs, Port of Spain (US$60 million ); Johnston International, multi-storey car park and retail, Port of Spain (US$28 million approx.); Helmuth Obata & Kassabaum, design services for the Brian Lara Academy, Tarouba (US$500,000); Shanghai Construction Group, Social Development Towers, Port of Spain (US$60 million approx.); China Jiangsu, three housing contracts (US$12 million).
There is an abundance of foreign labour brought in primarily by Chinese contractors. There may be about 3,500 foreign workers in the building construction sector with wages as much as 60% lower than prevailing wages in the local construction sector.
The ongoing expansion of Trinidad and Tobago’s construction sector provides a number of opportunities for both Canadian small and medium-sized enterprises and larger companies. With energy-related, public sector and commercial activity expanding, the construction sector is fully stretched. Two critical issues continue to emerge: the shortage of skilled and unskilled labour, and the award of contracts to foreign companies.
The islands are also experiencing shortages of gravel, sand, clay blocks and other building materials. To ease the aggregate shortage, some companies have turned to import shipments of aggregate from Canada at a lower cost than from within the region.
The majority of buildings, both commercial and residential, are constructed largely of concrete, with embedded steel and mesh for added strength. Roofs are made from a range of materials, including galvanized steel sheets, clay tiles and asphalt shingles. Wood-framed roofing has now been replaced by 2″ x 4″ steel beams and zed-purlins to which steel-galvanized sheets are fastened. Flooring is often tile (ceramic, clay or porcelain), vinyl or hardwood over concrete. Some carpet flooring is still acceptable.
There are local and regional manufacturers of some of the products used in building, such as steel and aluminum windows and door frames, PVC tubing, clay blocks, tiles, galvanized roofing, interior finishes and electrical fittings. Building-related products are imported from the United States, China, Canada and Latin America.
The T&T government’s massive construction program, particularly in housing, has opened up demand not only for labour but also for new technology to speed up the construction process and reduce costs. The market is generally receptive to new building and construction products and technologies. Companies are looking for innovative ideas and technologies, and they welcome products that make the building process easier and more efficient. One example of this is the use of steel forms, which enable rapid construction and can be reused. There is also a demand for new systems such as styroprene panels between the concrete for insulation, panels made of fibreglass and plastic composites, and panels in which window and air-conditioning openings are pre-set and into which walls are poured.
Because of its long-lasting structural qualities, concrete remains the most popular building material. Residential homes are constructed from concrete blocks, and industrial buildings use steel and concrete in framing the roofs. Prefabricated buildings are not popular in Trinidad and Tobago. There is, however, growing interest in alternatives such as wood (particularly for joinery purposes, mainly doors, windows, flooring and panelling) and steel structures.
Products currently in high demand include lumber, lightweight steel framing, home-improvement products, flooring, exterior cladding, and insulation products and systems. In addition, fixtures and fittings, roofing material, plumbing material and equipment, and kitchen and bath supplies are in great demand.
3. Sub-sector Identification
The main sub-sectors are as follows:
- The highway construction program;
- The roads and bridges maintenance program;
- Urban renewal and development;
- Development of a mass transit system; and
The increased economic prosperity in Trinidad and Tobago has delivered significant benefits to the population, but it has also produced some adverse consequences. The rapid rise in private vehicle ownership and use (due in part to massive imports of re-conditioned vehicles), increases in goods and cargo transport, and continued urban and rural development have precipitated a need for improvements to public transport facilities, possible light rail transit systems, water taxi services, new waterfront link roads, expansion of the trunk road system, and the construction of more highway overpasses and interchanges.
The development of the infrastructure in these areas will require the full range of expertise and skills, including engineering, architectural, social and economic, financing, contract administration and information technology. While there is a need to incorporate the highest standards in T&T’s development thrust, the nation also faces a dearth of the qualified professionals needed to implement these programs.
4. Case Study
Canadian firms active in the construction sector include consulting engineering firms such as Genivar, Dessau Soprin, Ellis Don, NDLea (recently acquired by Marshall Macklin and Monaghan International Inc.), Stantec and Cansult.
The biggest success story in the sector involved Genivar. In 2004, Genivar was contracted by the Government of Trinidad and Tobago as development manager for the Port of Spain International Waterfront Project, which calls for the transformation of the capital city’s port area. The $220-million project, which will be completed in early 2008, will include a five-star hotel, two office towers, a conference centre and a commercial centre.
Genivar’s role as development manager included initial commercial and planning studies and analysis to determine the optimal size and type of facilities to develop on the site, along with analysis and recommendations as to the delivery method. The company subsequently recommended a “design-build” delivery basis and early contractor involvement (ECI). Following this recommendation, the company developed the design-build request for proposal, including outline performance specifications, code requirements, contract conditions and terms, commissioning, and quality control and quality assurance requirements. Genivar now acts as project manager and owner’s advocate, managing the delivery of the contract by the design-builder. The International Waterfront Project was the first in Trinidad and Tobago to involve ECI.
Genivar has been awarded an additional mandate to design and manage the construction of new facilities for the Port Authority of Trinidad and Tobago, prior to delivery of the site to the design-builder. These facilities include the new cruise ship terminal, port security building, transshipment shed, and the telecommunications switchgear hub for the Port Authority. Genivar has since won contracts for several other projects in Trinidad and Tobago, further enhancing its expansion in that market. Over the past few years, it has developed a sizable portfolio of projects in Trinidad and Tobago, representing more than C$0.5 billion. The company has acquired a local Trinidad company and established an office in Port of Spain.
Canada. Department of Foreign Affairs and International Trade. “Construction Sector Report: Trinidad & Tobago.” October 2001.
Economist Intelligence Unit. EIU Country Profile-Trinidad & Tobago 2007
United States and Foreign Commercial Service and U.S. Department of State. “Country Commercial Guide: Trinidad & Tobago.” September 3, 2003. Accessed from http://www.stat-usa.gov
Tourism and Industrial Development Company of Trinidad & Tobago Limited. “Trinidad & Tobago: Building on Investments.” Undated.
 The Government of Canada has prepared this report based on primary and secondary sources of information. Readers should take note that the Government of Canada does not guarantee the accuracy of any of the information contained in this report, nor does it necessarily endorse the organizations listed herein. Readers should independently verify the accuracy and reliability of the information.
 All monetary amounts are expressed in foreign currency, unless otherwise indicated. Foreign exchange rate is based on Bank of Canada rate, 2006.
 Trinidad and Tobago Budget Statement 2008.
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