Caribbean Islands - Trinidad and Tobago Growth and Structure of the Economy

Growth and structure of the economy

Trinidad was neglected by Spanish mercantilists until the late 1700s because it was perceived to be poorly endowed. In 1776 Spanish authorities finally allowed French planters from other Eastern Caribbean islands to enter Trinidad, stimulating the subsequent expansion of a sugar plantation economy based on slave labor (see Colonial Heritage, this ch.). After the creation of the first sugar plantation in 1787, agriculture expanded so rapidly that a decade later there were 159 sugar plantations, 130 coffee estates, 60 cacao (the bean from which cocoa is derived) estates, and 103 cotton estates. The rapid success of the French planters attracted the interest of the British, who captured the island in 1797.

In the early 1800s, Trinidad's agricultural economy was based on highly productive cane fields and on coffee, cacao, and other export crops. Trinidad's average sugar plantation (over 240 hectares) was larger than that in other Commonwealth Caribbean islands. Unlike smaller islands, such as St. Christopher and Antigua, Trinidad was less dependent on sugar for its labor and exports, as other export crops held relatively important economic roles. Agricultural estates were worked by slaves imported from West Africa until 1807, when the British abolished the slave trade. After complete emancipation in 1838, freed blacks played a decreasing role in agriculture because of the annual importation of about 2,000 indentured East Indians, more than in any other Caribbean island. At a time when other English-speaking islands were suffering declines in sugar production, Trinidad's quadrupled from 1828 to 1895, mostly as a result of the imported East Indian labor force. Although sugar wages were low, wages of Trinidadian sugar workers in the 1800s already surpassed those of their Caribbean counterparts.

Tobago, officially linked to Trinidad in 1889, was traditionally neglected by both the Spanish and the British in economic terms. Nevertheless, Tobago was one of the top sugar producers in the West Indies in the early 1800s. Tobago's agricultural production was characterized by the French m�tayer system, a form of sharecropping, imported with French planters from St. Lucia. As late as 1839, the island registered an annual trade surplus as large as 20,000 British pounds sterling. As its sugar industry declined in the late 1800s, however, it received less and less attention from the British, preventing significant infrastructural development. Economic neglect continued for decades, so that by 1946 Tobago was the most underpopulated island in the British Caribbean.

Trinidad and Tobago entered the twentieth century with the fortuitous discovery of oil in 1907. The discovery changed Trinidad's patterns of economic development and further differentiated it from other English-speaking islands in the Caribbean. Exports of oil left the island for the first time in 1909, but production did not drastically increase until the British Royal Navy converted to oil during the following decade. During World War I, Trinidad and Tobago became the major source of oil for the navy. As oil output skyrocketed from 125,000 barrels a year in 1910 to over 2 million barrels by 1920, so did the number of foreign oil companies competing for control of the precious resource. The oil boom during the second decade of the 1900s was not experienced in the rest of the economy, however, which was depressed.

As the decade came to a close, two events changed Trinidad's economic future. The termination of East Indian indentureship in 1917 created greater economic demands from the agriculture labor force, whose wages had hardly increased over a century. The other major event was the return of Trinidadian soldiers from World War I who served in the West India Regiment. Exposed to greater personal freedoms and workers' rights, as well as prejudice, these veterans were at the forefront in organizing for greater economic benefits for labor from foreign sugar and oil companies.

The first visible signs of Trinidad's growing labor movement appeared in the aftermath of the riots of 1919 when Cipriani assumed the clear leadership of the movement. The Cipriani-led labor movement in the 1920s fought for a minimum wage, eight-hour day, child labor laws, compulsory education, heavier taxation of foreign oil companies, and general social reform. A moderate, Cipriani tempered the burgeoning labor movement under British colonial rule until the early 1930s, when the labor movement was radicalized by the advent of the Great Depression.

The economic hardship of the depression resulted in fewer jobs, poor health conditions, low wages, and growing resentment of wealthy, foreign ownership in the oil and sugar industries. The decline in sugar that accompanied the depression, severe droughts, and disease of the cacao crops drastically increased rural unemployment in the early 1930s. The downturn in sugar, in particular, led to the consolidation of the landholdings of the dominant British firm, Tate and Lyle, which continued to pay its London stockholders handsome dividends. Decreased economic opportunities in the countryside sparked widespread demonstrations in the sugar belt by 1934. Meanwhile, health conditions remained poor, as many Trinidadians suffered from malaria, ancylostomiasis, tuberculosis, and yellow fever. As unemployment remained high, wages were kept low--only US$0.72 a day for an unskilled oil worker and US$0.35 a day for an unskilled sugar worker in 1937. Large profit remittance continued in the oil industry as well as in the sugar industry, causing growing worker resentment of foreign ownership; this resentment culminated in the riots of 1937.

Butler emerged from the islandwide strikes of 1937 as the undisputed successor to Cipriani as the leader of the Trinidadian labor movement. Butler, more radical and uncompromising than Cipriani, continued to forge a strong trade union movement in Trinidad and Tobago. Rienzi, Butler's associate, was another rising labor leader who came to lead the powerful OWTU and later presided over the FWTU, an umbrella labor organization. The labor movement in the 1930s was also marked by the growing participation of East Indians, most notably through the ATSE/FWTU. Although by 1940 Trinidad and Tobago had extensive and relatively responsible trade unions, it was not until 1943 that they possessed the procedural framework to negotiate industrial disputes effectively with the British. Nonetheless, Trinidad and Tobago generally enjoyed strong negotiating power with the British because of the colony's vital oil resources.

More about the Economy of Trinidad and Tobago.

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