The household cost of economic mismanagement in T&T

Last Fri­day, the Cen­tral Bank of T&T re­leased its 2025 Fi­nan­cial Sta­bil­i­ty Re­port. By now you would be aware of the head­line that says that by the end of 2025, es­ti­mat­ed house­hold debt in Trinidad and To­ba­go reached $72.3 bil­lion, or 41.5 per cent of our gross do­mes­tic prod­uct.

I have been writ­ing this col­umn since 2004 and truth be told, my mo­ti­va­tion for do­ing so was to try to avoid us get­ting to this place. Yet here we are and I have all the da­ta over the years to show you how we got here.

In or­der to grasp what has hap­pened you need to look at the tra­jec­to­ry over the past 20 years. Dur­ing the en­er­gy boom years be­tween 2004 and 2008, house­hold debt av­er­aged about 21 per cent of GDP. By 2015, it had climbed to rough­ly 29 per cent of GDP ul­ti­mate­ly reach­ing the cur­rent lev­els of 41.5 per­cent.