Above: Dr Keith Nurse.

BitDepth#1429 for October 23, 2023

At the Central Bank on September 27, a panel of Carnival stakeholders considered the current state of the festival under the theme, Re-engineering the Economics of Carnival for Sustainability.

It’s not as if there were no talk shops to consider the critical issues facing TT’s Carnival before this, but the Central Bank’s Kevin Finch offered the rationale for the financial regulators’ involvement.

“As time progresses, we have witnessed the demise of what used to be staple events and the rise of a new genre of Carnival related activities. As economists, we can surmise that Carnival suffers from several structural issues, many of which oscillate around its financial viability.”

“Over the past few years, as a bank, we have been focusing our research efforts on structural reforms and the needed changes to the institutional and regulatory framework in which businesses and individuals operate to enhance economic outcomes.”

Moderator Carla Parris, an intellectual property (IP) lawyer, noted that, “Carnival is an ecosystem made-up of a variety of people whose goods and services contribute revenue to our economy and contribute substantial foreign exchange.”

“When you think of the logistical aspect, we have the people who drive the trucks, who are involved behind the scenes. Although all these people generate revenue, what is quite disturbing is that there are income sources that are not being tapped into and not understood by creatives, government agencies, and even by legislators.”

Costatt president Dr Keith Nurse who wrote a pivotal paper on the globalisation of Carnival a quarter of a century ago, noted that the TT Carnival is “The most globalised carnival and the most globalised festival. There are more replications of TT Carnival than of any other festival on planet Earth. I don’t know if the population really understands this. (It is also) one of the festivals with the highest domestic participation.”

“Trinidad Carnival is not just Port of Spain Carnival, there are 50 to 55 carnivals happening in Trinidad, all at the same time, making it one of the top three to five festivals in the world in terms of national participation.”

In this context, the panel lamented the lack of structured information that can be used to measure, analyse and plan the annual festival.

Visitor arrivals and spending are tracked across 19 days for Carnival, but the expanding reach of the festival, which really begins formally on Boxing Day and the efforts by event promoters, performers and steelbands to continue working throughout the year calls for an expanded idea of when Carnival happens and the real impact that it has on the national economy.

“You cannot manage anything that you can’t measure because you don’t know if you’re doing better this year than last year or 20 years ago,” Nurse said.

“If you’re actually not collecting data and capturing data on something that is so important to us, it means you are being left behind by the world. I’ve been doing research in this area for 25 years (and) our capacity to measure is worse now than it was 20 years ago.”

“The Central Statistical Office used to do a publication called the Carnival Digest and it was published every year. It was the best source of data on festivals anywhere in the Caribbean.”

“Then, there was a fire at the CSO and a change in staff and that was the end of that. It took a number of years before the Tourism Ministry and the Central Bank started collecting some of this data. But for many years we went without any institution collecting data.”

“We all cherish this thing called TT Carnival, but we’re not investing in it from a strategic standpoint because we view it as an event, as a party, as a really good time, but not as an industry. If you apply an event-focused approach, which is what most of our institutions do, the bulk of the funding that goes into Carnival is spent on the event but not to build an industry.”

Nurse noted that the TT investment in Carnival was similar to Canada’s investment in its artists, but that effort focused on trade and generating income.

Keith Nurse offered estimates on the real income from Carnival, noting that the 2020 take of US$60 million might actually be US$100 million when repeat early visitors are factored in.

An additional US$5 million might be generated by music royalties. And even that might be on the low side when potential revenue from destination branding and domestic activity are factored in.

He believes that Carnival might well be in shouting range of a billion dollar industry even before serious action is taken to monetise it.

“We have a product that we sitting on here that generates foreign exchange for us,” said Jerome Precilla, president of the TT Event Promoters Association.

“A lot of the people who make important decisions pacify the nation by (giving the NCC millions in funding, saying) allyuh go ahead and make sure Carnival nice and people have a fun time.”

According to Keith Nurse, TT’s Carnival and the more than 100 festivals it has been seeded to globally, include the largest outdoor public events of their kind, in the US, New York’s Carnival, Canada’s Caribana and in Europe the UK’s Notting Hill Carnival.

Yet, TT still doesn’t spend any real money to understand and exploit the economic potential of an asset that’s hidden in plain sight.

Dr Keith Nurse’s five areas of economic focus for Carnival

Goods

“Steel pans. How many steel pans do we produce in Trinidad and Tobago, and how many do we export? Because most people think we export big pans, but they are very difficult to export, they are very bulky. In many other markets, particularly in Europe, people produce their own pans.”

Services

“In some cases, they import the pan tuners, which represents income in services. We need to capture data on services that includes the export of services in terms of what we call movement of natural persons. If Caesar’s Army has a company registered in multiple locations, that’s what we call establishment of presence. That’s another form of services income.”

“When tourists arrive here, that’s another mode where people arrive or come to consume the service. The growth in services is online, and it is the fastest rising component of services income.”

Intellectual property

“We can generate income from IP in multiple ways, from copyrighting music and designs, but then there is intellectual property branding. Machel Montano has chocolates. He’s using Carnival as a mechanism to sell chocolates. And, well, maybe why shouldn’t we be doing it that way? That’s our key value added.”

Data Monetisation

“This is really where things like e-commerce and the blockchain come into play. These are the areas where most developing countries don’t even have a clue what’s going on, but data localisation is really critical for digital industrialisation.”

“The Central Statistical Office (uses a) 20th century model for collecting data. So you can’t collect data on things like data monetisation. If we are not talking about these things, it means we are being left behind by the global economy.”

The Experience Economy

“You will find this linked to what we call the creator economy. People who are doing blogs and generating income from brands and sponsorships.”