The long-term economic impact of the oil spill in Tobago could be profound, as it could lead to the deepening of the island’s dependence on Trinidad, depending on the extent of the contamination of the island’s ecosystem, Tobago economist, Dr Vanus James said on Friday.
He said the oil spill could have a short-term impact on Tobago’s tourism as the story of the oil spill has been all over the international media.
The impact on the island’s tourism product could be long term depending on where and how much damage is done to Tobago’s beaches, reefs, mangroves and dive spots.
“Tobagonians must realise that the island is a government-dominated economy and not a tourism economy. So there is a certain amount of insulation of the economy from the impact of the oil spill, as the transfers from Trinidad to Tobago are not likely to be impacted by the oil spill,” said James.
Depending on the impact of the contamination, people could lose their jobs in the tourism sector and may be driven to work for the government on the island.
“This could lead to an eternity of dependence by Tobago on Trinidad,” James said, pointing out that by his calculation, employment by the Tobago House of Assembly is 20 per cent less productive than the average employment in T&T.
Retired economist Gregory McGuire, chairman of the Trinidad and Tobago Extractive Industries Transparency Initiative (TTEITI), said the oil spill will have serious implications for fisherfolk and the tourism industry if the clean-up is not thoroughly and speedily done.
McGuire said the entire marine environment, and the economic activities it supports, can be negatively impacted to varying degrees.
“The obvious impacts will be on the tourism sector as Easter is one of the peak periods for domestic tourism! Additionally, fisherfolk, tour boats, and all those involved in maritime activity can feel the pain of the disruption caused by this spill.
“There may also be long-term impacts as well as the fish stock around Tobago waters may be contaminated, leading to consumers becoming hesitant about eating fish,” he explained.
These risks, he said, however, can be mitigated by a speedy and thorough cleanup process.
Dr James said the fisherfolk will be greatly impacted and the demand for fresh fish will fall sharply.
“A lot of people are already saying they would not be buying fish anytime soon. So that will affect them, and they are already operating in an industry that was already damaged, from 2022 when it declined by about 0.4 per cent. So they are going to be taking a further beating in 2024. Many of the fisherfolk will have to look elsewhere for steady income,” James outlined.
Another point he addressed was that tourism is a tiny share of Tobago’s economy as the island runs a government economy and that is where the spending power comes from.
“Tobago economy is largely independent of the short-term damaging effects and the long-term effects are going to be felt by the fisherfolk and the tourism services sector,” the economist added.
Early detection
McGuire, said early-detection radar systems will help to speed up remediation efforts to deal with spills whenever they occur in Trinidad and Tobago.
Giving his thoughts on the oil spill which began on February 7, he said his understanding is that the Ministry of Energy has plans for purchasing and installing such systems and he believes this is a step in the right direction, to detect the spills early.
He told Sunday Business Guardian that this country has a well-documented system for treating oil spills, including the cost of clean-ups, and in the event of an oil spill, the Environmental Management Authority (EMA) calculates the value of the environmental damage, cleanup and rehabilitation.
McGuire noted that this cost is to be borne by the liable company, but in this case, the owner of the capsized vessel named “Gulfstream,” is yet to be identified.
“Under the Petroleum Act, the upstream companies are required to place funds in an escrow account to cover costs in the event of an oil spill. The latest TTEITI report indicates that the sum of US$94 million is currently held in an escrow account at the Central Bank to deal with oil spills. The TTEITI report also provides data on the number of oil spills occurring in the country in any fiscal year,” the chairman detailed.
Unfortunately, he said in this case available information suggests that this is not a local company nor a foreign company operating in TT.
No impact on NGC
Trying to ascertain what impacts the oil spill may have had on infrastructure, the National Gas Company (NGC), which constructed a sub-sea natural gas pipeline to the southeast of Tobago , which comes ashore at the Cove Industrial Estate, said its infrastructure has not been impacted.
“The pipeline is 20-30 metres underneath the seabed in that area and therefore not susceptible to any external impact from sinking objects,” the company told Sunday Business Guardian
Asked if NGC has been called upon to assist in the oil spill mitigation efforts, the gas company said: “No it has not been engaged to assist at this time, but will deliver support should it be required.”
Businesses not affected
Chairman of the Tobago Division of Tobago Chamber of Industry and Commerce, Curtis Williams, said the members indicated that their businesses were not impacted, as the oil spill was focussed on the Atlantic side of the island.
Williams pointed out that the Coast Guard station in Tobago needs to be better equipped to respond to emergencies promptly.
“The base here is poorly maintained and equipped….They don’t even have a flagpole to fly the national flag and the Coast Guard ensign. The building is in a deplorable state…. you can take a picture of it yourself and verify my feedback. Tobago Emergency Management Agency did the best they could with limited resources,” he mentioned.
Combined efforts
Prime Minister Dr Keith Rowley in the House of Representatives, last Friday said Energy Minister Stuart Young and Minister of Works and Transport Rohan Sinanan offered continued support and expertise from their Ministries to the THA and TEMA.
Rowley said the Ministry of Energy personnel were also present and have been participating in and providing expertise in the response exercise which is underway.
He noted that Heritage Petroleum Company Limited sent resources to Tobago including personnel and equipment, to assist in the response to this ongoing situation.
The Prime Minister said the Ministry of Energy initially requested assistance from Woodside Energy and their approval of the use of a private service contractor (Kaizen Environmental Services Trinidad Ltd) that Woodside Energy had in Tobago with the expertise to deal with containment and clean-up operations.
“All the correspondence provides a comprehensive and accurate account of all that has taken place in a multi-disciplinary, multi-sectoral team approach, and should help to dispel some recent inaccurate, irresponsible, and misleading commentary that there has been an attempt to conceal information from the public, particularly the Chief Secretary of the Tobago House of Assembly, on the matter of the oil spill. There has been no hint of any cover-up,” Rowley stressed.
