Government Assistance to business

Aims of Government assistance to business:

Protect existing jobs
Create new employment
Encourage enterprise
Increase national output and living standards
Increase exports
Reduce imports
Forms of Government assistance
Institutions for lending capital
Training and technical assistance
Research and information centres
Subsidies and grants

Subsidies and
Grants
Benefits

Used to encourage businesses to increase output of

important products such as agricultural goods.
The increased production will lead to lower market prices,
so consumers will benefit too.
Cash grants can also be given to businesses that are
struggling to survive (due to recession or natural disaster).
Infant businesses that have higher average costs than
larger established businesses can be given grants to help
them overcome this problem. Should be used for a limited
time only.

Drawbacks

Import
controls
Benefits

Drawbacks

Subsidies can be very expensive (opportunity cost as less

money will then be allocated to education, health care).
Can create unfair competition for other businesses in the
industry
All CARICOM members impose import controls such as
tariffs and quotas on goods and services from nonCARICOM members.
This helps to protect the regions own businesses against
unfair competition.
Provides governments with finance.

They raise retail prices on imported goods and services

Although they protect local businesses, these import
restrictions can reduce competition and therefore also the

incentive for local firms to become more efficient

Other countries might become angry that Caribbean
countries are limiting imports from them and so in turn
might put import tariffs on products from our region
Government also pass laws that aim to give specific support to
certain industries. In Jamaica, the Export Industry
Encouragement Act offers tax relief and relief from customs
duties (e.g. when a wishes to expand its factory). The Waiver
of Duty Act allows for some industries (Agriculture and
manufacturing) to be allowed to import certain raw materials
or capital equipment free of import duties, thus increasing the
competitiveness of businesses in these industries.
BDCs provide the following services:
Business and technical support
Guide business start-ups
Offer consultancy services to established businesses
Provide loans

Legal Support

Business
Development
Corporations

Innovation
Support

Business
Development
Company
Limited
Tourism
Development
Authority
(formerly
Tourism and
Industrial
Development
Company Ltd
TIDCO)

E.g. Jamaica Business Development Corporation (JBDC)

The Barbados Investment and Development Corporation
offers similar services as above. One Department focuses on
small and micro businesses.
The Small Business Development Venture has an Innovation
Support Programme.
In T&T ETTIC, NEDCO
Based in Trinidad but many participants in the management
training courses come from other islands. It aims to improve
the quality of information available to business managers in
the region, and also consultancy services
http://www.bdc.co.tt/
http://www.tdc.co.tt/who_we_are.htm

Provide advice and technical assistance to all businesses

in eth tourism industry
Establish and check on standards for all tourism amenity
products, to make sure that the two islands tourist
industry has an excellent international reputation
Upgrade the reception and information facilities at the
official ports of entry to T&T

National
Financial
Literacy
Programme

http://www.nflip.org.tt/newsletters_and_publications2.htm
The core financial literacy elements that we cover are:
Budgeting, Savings, Investment, Thriftiness, Credit and Debt

management, Insurance, Planning ahead, Planning for

Retirement, Financial fraud, Financial products, Estate
planning, Mortgages, Starting your own Business, Record
Keeping for Small and Micro Entrepreneurs