120,000 jobless, 6,000 small businesses closed, while THE RICH GETTING RICHER

ONE year after creating a monopoly in the importation of pharmaceuticals, Agostini Ltd. has reported a staggering 49.5 percent six-month profit, compared to the previous similar period. 

Company Chairman Christian Mouttett – in what amounts to an understatement – said that pharmaceutical distribution “performed well organically”. 

With its purchase of Oscar Francois Ltd. and Intersol Ltd., Agostini controls the importation – and pricing! – of all medications in Trinidad and Tobago. 

Six strategically-placed Superpharm drug stores also make Agostini a critical player in the retailing of pharmaceuticals. 

The Government declined to intervene even after the Pharmacy Board and others raised howlers about the impact of a monopoly on medicine costs to the small man. 

The Fair Trading Commission also kept quiet. 

Agostini, which is also involved in oil and gas, food manufacturing, industrial, lubricant and construction sectors, is a long-standing family business. 

Several Small and Medium-Sized Enterprises (SMEs) which were active in some of these businesses were among the 6,000 that did not re-open after the Covid-19 crisis. 

Many of these SMEs were owned by women, according to Jai Leladharsingh, head of the Confederation of Regional Business Chamber. 

The Retailers Association said 78,000 workers in sales were thrown on the breadline by the medical pandemic. 

The total number of jobless and under-employed workers, including former Petrotrin and energy servicing employees, is around 120,000, about one-fifth of the workforce. 

Massy Holdings, which has 60 companies in six business segments, has just reported a four percent six-month increase in profit. 

This adds to 20 and 36 percent second and third-quarter gains respectively. 

Massy is a conglomerate whose operations span gas, insurance, finance, manufacturing, motors, machines, retail – and more. 

The company is publicly-traded, worth $10.1 billion, and its directors are all top business brass, including banking executives. 

It is safe to assume that shareholders are not the common people of Trinidad and Tobago, those struggling from month to month or hunting for jobs to pay their rents. 

While the Massy Group is engaging fairly in the free enterprise system, the business behemoth benefitted directly from the shutdown of SMEs during the Covid-19 crisis. 

The group entrenched itself in several sectors while banks were calling in the keys of defaulting small businesses that could not meet their loan and overdraft commitments. 

At Massy food stores, there are now appliances, stationery, bread, eyeglasses, flowers, and various other items and services in which the company did not previously trade. 

The group made similar advances in other sectors. 

Massy carries a consolidated balance sheet, but Group Chairman Robert Bermudez said in his most recent report that the “integrated retail portfolio” grew by 25 percent over the previous year. 

In a retail economy that has contracted in recent years, Massy took a significant slice from small and vulnerable dealers. 

But that conglomerate is not alone. 

AnsaMcAl, which operates 48 companies, has returned to pre-pandemic profitability, according to Chief Executive Officer Anthony Sabga 111. 

Most segments scored increased profits, with the distribution business strengthening its customer base and benefiting from “high demand for food and cleaning products,” Sabga said. 

The beverage sector had “a strong performance”, and automotive trading and distribution were the highest revenue earners, Executive Chairman Norman Sabga revealed. 

While AnsaMcAl is doing well in auto sales, the pre-owned (foreign-used) sector continues to reel, with several shops shutting down and sending home workers. 

“This is a plot to destroy our businesses and livelihood,” Visham Babwah, President of the Trinidad and Tobago Automotive Dealers’ Association, has said. 

“Every attempt we made to (pivot) our business, (the Government) undermined it,” Babwah said. 

Among other SMEs affected by the Covid-19 emergency were operations in food services, manufacturing and supplies, food processing, construction, wholesale, and retail. 

A study by the Trinidad and Tobago Manufacturers Association (TTMA) found that 78 percent of SMEs experienced a reduction in sales, with 60 percent having faced a decline of more than 50 percent. 

SMEs typically employ between six and 25 workers each. 

In contrast, Massy reported that its growth in retail took place “in all markets”.  

Some small groceries and community shops were forced to close, while Massy, benefiting from factors of production, opened five new retail stores, including a sprawling enterprise in Chaguanas. 

TTMA noted that 36 percent of SMEs terminated full-time employees and 54 percent sent home part-time or contracted workers. 

Of the SMEs that remained open, 46 percent were forced to cut workers’ wages. 

The manufacturing body told of SMEs operating in the formal sector “having problems accessing credit. 

“The financial gap is even larger when micro and informal enterprises are taken into account. 

“In fact, SMEs are less likely to be able to obtain bank loans…” 

That brings us to the banking sector. 

The Government launched a $496 million SME Stimulus Programme to support micro, small and medium-sized businesses during the pandemic. 

The loans were facilitated by the four largest commercial banks but clearly did not do enough to save the thousands of businesses that went bust. 

In addition, while small operations were hitting the business graveyard, every bank reported increased profit. 

Local banks did not provide the active support to struggling businesses as their international counterparts, which offered paycheque assistance, low-interest loans, pause on foreclosures and other forms of assistance. 

In Britain and elsewhere, governments mandated banks to work with businesses to seek solutions to their financial woes. 

British Finance Minister Rishi Sunak noted that small businesses were struggling to access credit. 

Sunak assured: “If we want to benefit from their dynamism and entrepreneurial spirit as we recover our economy, they will need extra support”. 

In Trinidad and Tobago, the Government and Central Bank merely used moral persuasion. 

Republic Bank, the country’s largest finance house, reported a 1.2 percent increased profit for the quarter ending December 31, 2021, compared to the previous similar period. 

Republic raked in $1.3 billion profit in the fiscal year that ended on September 30, 2021, which was 44.7 percent above that of the previous period. 

The other major banks – RBC, Scotiabank, and First Citizens – also reported increased profits in 2021, achieving growth even while other business sectors were tottering. 

Central Bank Governor Alvin Hilaire said that “our regulators remain in high mode,” but the large number of crippled SMEs is evidence of limited support from banks.  

The number of non-performing loans has risen, the Central Bank reported. 

Other sectors owned by large enterprises are also flourishing in the contracted economy. 

In media, for example, Guardian Media reported an annual profit of $6.5 million, after cost-cutting, including job reduction, of $6 million. 

One Caribbean Media revealed annual profit of $29 million, a 22 percent growth. 

Those gains took place even in the midst of severe shrinkage in the advertising pie. 

In contrast, a community television station has closed down after $5 million losses over two years, turning a dozen workers jobless. 

Shareholders in all the profitable companies earned dividends on their investments. 

The small man, meanwhile, has had to cope with galloping hikes in the cost of food, higher taxi fares and growing unemployment. 

Without spending power, poverty is on the rise. 

The hardship is also reflected in the real estate market, with some homeowners leaving properties unsold as they migrate to greener pastures. 

With the decline in the energy sector, expatriates have left the country, and this has also impacted mortgage sales and rental prices. 

“The market is flooded with homes the average citizen can’t afford,” an industry insider said.  

The raw fact is the rich is growing richer, the poor is struggling to put food on the table, and the middle-class is vanishing. 

There have been no meaningful and enduring Government measures to prop up and bolster the endangered SME sector or to support the hard-pressed working class. 

Without a Monopolies Commission or freeze on interlocking directorship, business big pappies are linking arms for their common good, often at the expense of consumers. 

There are no active policies to dilute the concentration of wealth among a few and to provide a seat at the table for the small man. 

Basdeo Panday, one of the few national leaders to protest the band of business elites who controlled the private sector, branded them a “parasitic oligarchy”. 

Unless there is a re-ordering of the economy, such dominance would be strengthened, confining the working masses to mere “hewers of wood and drawers of water”. 

The authorities have shown no appetite is creating that economic transformation. 

Instead, the traditional elites are becoming richer while the poor man scrapes crumbs off the table.