Strategic Plan for the Promotion of Professional Services Exports in Barbados – Engineering and Construction-related Services Sunil Sinha Technical Director Emerging Market Economics December 2006

Overview  Strong international demand: World market for construction-related, knowledge-based services (engineering, architecture) worth about US$600 billion About $300 billion is contestable by specialist firms  Market can be divided into engineering and architectural services

International Trends Engineering Services  Most services supplied domestically due to qualification requirements  But, international trade increasing due to: Cost differentials, increased specialisation Large projects requiring expertise, experience, scale Engineer shortage in some countries, cheap engineers in others Offshoring to cheaper in-house locations and outsourcing to low-cost destinations  Outsourcing typically through local sub-contracting and farming out of low-value added services Architectural Services  Lower trade volumes due to more stringent registration requirements  Outsourcing will remain limited to labour-intensive activities like draughtsmanship

Local Capability  180 corporate members of Barbados Association of Professional Engineers  Estimated 40 chartered engineers  About 24 architecture firms, 64 members of Barbados Institute of Architects, professionals constitutes a large firm

Target Markets  CSME for engineering and architecture  UK for engineering – shortage of professionals  EPAs likely to remove restrictions on practicing in EU countries, could open up architecture market

Market Positioning  High quality professionals, long- established large firms provide basis for providing high-quality services for large projects in CSME  Particular skills in environmental management, disaster mitigation, other area?  Labour cost advantage over US, Western Europe?

Marketing Activities – Brand Awareness Objective: Increase profile of sector internationally  Website: Promote Barbados as source of quality construction-related services; avoids restrictions engineers, architects face in marketing themselves

Marketing Activities – Direct Marketing Objective: Create export opportunities  Marketing Trips: Larger, export-ready firms to meet with UK firms to offer outsourcing services  Partnerships: Larger local firms sub-contract work to smaller domestic providers; smaller providers associate with each other to increase scale and improve ability to win international work  Marketing Support/Intelligence: Provide training to small providers in preparing competitive tenders, monitor project profiles

Enabling Environment Objective: Address local factors constraining growth  Accreditation: EPA should allow temporary work in Europe without qualification, should also work towards mutual recognition of qualifications  Free Movement: CSME should alleviate requirements for local accreditation, ensure local content is reduced.  Skills: increase supply of draughtsman  Incentives: improve access to export incentives and finance for SMEs  Alliances: forge private-private and private-public partnerships

Thank you