Trinidad and Tobago: Comprehensive Wealth on an Unsustainable Path

  • According to an International Institute for Sustainable Development (IISD) Comprehensive Wealth report titled “Trinidad and Tobago Moving Beyond GDP to promote sustainability, resilience, and well-being”, the compilation of comprehensive wealth measures for Trinidad and Tobago reveals unsettling trends that gross domestic product (GDP) does not.
  • While GDP growth suggests sound economic development from 1995 to 2020, comprehensive wealth paints a picture of moderate progress at best and suggests the country is on an unsustainable path, according to the report. Over the period 1995–2020, real (inflation-adjusted) per capita GDP more than doubled. Real comprehensive wealth per capita, on the other hand, increased much less, growing by only 11%.
  • Following the 2008 global recession, real comprehensive wealth per capita began a worryingly steady decline to 2020, falling 3.6% annually on average. Such a long and substantial decline in wealth is unprecedented for a high-income country. It signals unsustainability in Trinidad and Tobago’s development trajectory, which is not apparent in the country’s GDP figures.
  • Real GDP per capita, in contrast, held steady well after 2008, beginning to fall only in 2014. This was a full 5 years after real wealth per capita began its decline.
  • Today, leaders worldwide, including the United Nations Secretary-General, the G7 (Government of Canada, 2019), the Organisation for Economic Co-operation and Development, and the World Economic Forum, are calling on countries to move beyond GDP and start measuring what truly matters for prosperity. The United Nations Secretary-General, in particular, is strongly urging nations to adopt measures of progress that go beyond GDP, recommending comprehensive wealth as one valid approach for doing so.
  • A nation’s comprehensive wealth portfolio determines the prospects for citizens’ well-being. It involves elements such as produced capital, natural capital, human capital, financial capital, and social capital. The consumption of the goods and services produced by combining these various types of capital is an important driver of well-being for individuals and for nations as a whole, given that consumption of goods and services accounts for a great deal of what matters to people: nourishment, shelter, safety, health, leisure, and many other forms of self-fulfilment.

(Source: International Institute for Sustainable Development)