WTO & FTAA impact on the Adviser

Good morning ladies and gentlemen. Firstly let me thank you for the opportunity to address you all this morning, and express my honour to be part of such a distinguished panel. In fact, I am here as a substitute for David O’Brien who sends his regrets at not being able to attend this session as he had a prior engagement. Last Friday he suggested that I represent him at today’s discussion. Well I guess you know when your boss asks you to sit in what that really means, in the employees language that means “if I have the time no problem” in their language that means “see and be there.” Well anyway here I am.

I have been asked to speak this morning on WTO, FTAA and the impact on the Insurance and Financial Adviser. In researching the topic what I found was an abundance of letters, more specifically acronyms that have become part of our lives and we may not even be aware that they have. FTAA (Free Trade Area of the Americas), WTO(World Trade Organization), CSME (Common Single Market Economy), GATT( General Agreement on Tariffs & Trade), GATS(General Agreement on Trade and Services) and that’s just to name a few.

At this stage of my research, I felt as if I was back in kindergarten having to learn my alphabet for the first time. I wondered to myself; what are all of these initiatives trying to achieve?

I hope that without trivializing the issues or oversimplifying the matters, I can take the liberty of summarizing that in my mind the principle objective of each one of these initiatives can be described by the following statement.

“Each one of these initiatives is related and the overall goal is to allow the free movement of goods, services and capital through a series of agreements that will pull together into a single undertaking.”

It is often put forward by commentators that each of these objectives is where the few largest economies in the world dominate the rest of us, and require our countries to sign agreements and give access to our markets that we really do not want to.

Bearing this in mind, let me say this, we as an industry are fortunate to have access to the services of the International Trade Negotiations Unit. Last year when working with ATTIC, the ITNU submitted to Government several documents containing the elements of a strategy for these negotiations.

In general, the position taken recognizes the open nature of our market and the significant contribution made by our industry to the economy in terms of output and employment. Also recognized is the state of insurance legislation in Trinidad and Tobago and the efforts underway to update the Insurance Act and to change the nature of regulation and the regulator itself. It suggests that companies were willing to compete with foreign companies once they established a company in Trinidad and Tobago, and work under the same rules as we do. It noted the difficulty being experienced by the presence of suitcase traders setting up in our hotels to provide insurance, advisory and investment services. It pointed to the increasing blurriness present in the economy with insurance companies being involved in more than just insurance business, and to the increasing competition with other financial services companies for customers.

In view of the above and other considerations, it recommended a cautious approach to the negotiations but with an active intent to participate to seize opportunities.

It recommended that cross border trade be resisted, and that encouragement should be given to foreigners to establish companies locally to provide insurance services.

It wanted to be very careful about guaranteeing access to individual service providers while investigating ways to bring these individuals effectively under the supervision of national regulators. The regulations being implemented by legislators need to be updated to reflect more trade imperatives, and among the possibilities to be considered should be: -

q Implementing the proposals relating to minimum capital requirements

q Ownership limitations

q Requirements for placing certain percentages of business and suggestions for differential tax treatment

q Nationality and or Residence of Directors

This is just part of the picture. There are numerous other issues that will affect your future earnings that are presently being negotiated and for all intents and purposes may be outside of your control.

How is the FTAA & the WTO going to impact you as Insurance and Financial advisers? Let me take the easy answer and say, most probably in ways that we have not imagined.

As with most things in life, you do not experience the full impact of anything until you are consumed by it, until you are having to deal with the challenges every day. As a parent we do not know how we will deal with a terminally ill child. As a child we cannot imagine how we will survive without our parents. As a person in love we do not know how we can exist without our loved one. Yet everyday we hear and see people raising themselves up by their boot straps to meet these and other challenges that they could not comprehend before they became consumed by them.

I believe that the best way for you to respond to the challenge of the FTAA & the WTO is for you to do what you know the best. Go back to basics.

This audience is made up of intelligent, hardworking, individuals, some of whom have been very successful, some who have achieved greatness in the local and international arenas, and some of you here who want to rekindle that drive and passion that may have forsaken you for a short time.

Some of you are new to the industry and are here as Rookies looking for the secrets of success, wanting to rub shoulders with the icons in the industry such as Clico’s Neil Jones, or Bunny Alexander, Guardian’s Dale McLeod, or Amardo Marcano, Sagicor’s Premdath Seegolam or Jackie Bennett

Whatever the reason, let me say this, the secrets of success are simple and each and everyone one of you knows what they are. You know what it takes to be successful, no matter what the challenge. In your roles as financial and insurance advisers you must prepare yourselves to be able to adequately serve your customers.

1. You must be focused.

2. You must listen to your clients.

3. You must treat them with respect.

4. You must provide them with superior service.

5. You must go beyond the call of duty.

6. You must meet and beat their expectations of an Insurance and Financial Adviser.

7. You must be committed to ensuring that your advice is in their best interest.

No matter what the initiative may be, no matter how many letters make up the acronym, no matter how complex the negotiations are, there is one message that I want you to take away from today;

· The needs of our customers have not changed and will not change.

With or without the international players present, people still need advice.

· People still need Life Insurance for their loved ones.

· People still need to plan for retirement.

· People still need to plan for their children’s education.

· People still need advice on Estate Planning.

· People still need Financial Advice on Investments

I am here to suggest to you today that just as the world trading system allows Trinidad and Tobago a voice and a choice about what it wishes to do in the ongoing negotiations, you too have a choice in how you are impacted upon, not if, but when the FTAA and WTO become a reality.

The opportunities are yours, you know what you have to do to be successful, you know how best to treat your clients, and you know how to overcome the daily challenges. We can treat with the proverbial glass as being half empty or half full. I am confident that the group here today will treat it as being half full.

Let us go “Beyond the Boundary” to achieve what we set out to achieve.

Thank you ladies and gentlemen.