(876) 632 3245 / 632 3217

Prospects For Export-Led Growth In Jamaica

Jamaica’s historical economic performance and current reality indicate that all other things considered, the only lever we have to drive significant and sustained increases in growth above the anaemic 1% to 2% that we have managed, at best, over the last two decades is through increases in our net exports.

As a country, we need to decide whether achieving sustained export-led growth is important. If so, we need to ask where it falls within our national priorities. Is a focus on export-led growth even mentioned within our national growth strategy as a major

driver? Or is the strategy only focused on driving foreign direct investments (FDI), growing our hotel room numbers, building out the Special Economic Zones (SEZs), the JISCO investment in St Elizabeth and BPOs?

Over the last 15 years, Jamaica had high levels of FDI of US$867m, US$1,440m, and US$925m in 2007, 2008, and 2015, respectively. GDP growth in these years was 1.4%, -0.8%, and 1.0%, respectively.

In 2016 and 2017, FDI was US$928m and US$888m, with growth rates of 1.5% and 0.5%, respectively. In other words, the highest levels of FDI that we have had in the recent past did not result in significantly enhanced growth, with the positive correlation between GDP growth and FDI being very weak.

Our history has shown us, therefore, that while important, these investments and projects are unlikely to significantly alter our growth trajectory without also having a significant export component, accompanied by deep linkages to the domestic economy.

We hear talk about agriculture and the importance of agriculture. Where is the comprehensive modern, forward-looking agricultural development plan? If we take out the oil-import component from our trade deficit, would the deficit still be as significant? Why do we have such a massive trade deficit that continues to rise? How do we intend to finance our economy going forward? More borrowings? More taxes? Is that not what all governments have done, certainly for the last 30 years or so? What has been the outcome?

This is the real crux of our economic challenge, and even a cursory analysis would suggest that export-led growth should be the major thrust of our entire economic programme. But is it?

Since the Seaga administration in the 1980s, no government has had a specific, focused, targeted policy and supporting programmes as well as the attendant budgetary allocations to grow our exports. The Government in the 1990s undertook an extensive process to develop a national industrial policy (NIP) in which many of us we’re involved. This was a very hopeful time, as the process was led by the minister of finance at the time, Hugh Small, and had an excellent team of technocrats, including Professor Donald Harris, who did exceptional work on defining the options for our exports and elements of an export strategy. His work clearly showed the economic benefits that we would derive from shifting our focus to export-led growth. Unfortunately, this did not materialise’

We have subsequently had the National Export Strategy (NES), which was launched in 2009 and which was developed through public-private-sector partnership led jointly by JAMPRO and the JEA. It had some success, but failed to achieve its goals, largely because of under-resourcing by successive Governments. The second version of the strategy, NES 2015-2019, was launched in 2015.

One of the overarching goals of the NES 2015-2019 is to grow exports at an average of 15% per annum to bring export levels (dollar value) to the pre-recession level of 2008-2009 (i.e., US$5.2 billion). At the targeted rate, export of goods should have got back to US$2.3b by this year. Clearly, this has not happened. Again, this is largely because of a lack of focus on it by the government and inadequate provision of resources to JAMPRO and the JEA to make it a reality.

EXPORT GROWTH PROSPECTS

We have looked at the issues that have led us to where we are, but what about the prospects for us to do better? There are several fairly immediate approaches that can lead to a near-term change in our export trajectory, many of which have been presented to successive governments before.

Beverages, seafood, baked goods, yam, and selected agricultural produce and sauces are among the products that have led the consistent growth of the food component of our non-traditional exports even while other exports were declining. In fact, some categories have increased by well over 50 per cent over the last five years. Nevertheless, while this might sound good, how does it compare with other exporters in the region and globally?

In the area of sauces, Guyana has doubled their sauce exports in the last three years, Barbados gets up to US$1 on average more per unit than we do, and the Dominican Republic (DR) exported US$92m in 2016, while we do a meagre US$19.2m by comparison.

Beverages in the categories that we export are growing at well over 30% per annum, with exports from Barbados and the DR growing at between 45% and 80% over the last several years, and, for countries like Zambia and Tanzania, growing at 130% and 380% in 2014, respectively. Our baked goods (cakes, buns, biscuits, etc.) are also showing consistent growth and can grow at much faster rates as also are our seafood exports, driven by the performance of firms such as Rainforest Seafoods, B&D Trawling, and others. In general, then, we can do much better than we are doing at the moment.

EXERCISING OUR OPTIONS

While we have shown consistent improvement in some areas, what is required is a coherent, comprehensive programme like that outlined in the NES, implemented in a disciplined manner to meet the targets we have set. This could build on the platform that has been set for us to really produce moderate to high sustainable economic growth by the decades of sacrifices that Jamaican people have made to get to where our national finances are today.

However, this will only happen if we have the right strategies, chosen on the basis of empirical evidence and facts, and supported with appropriate human and financial resources. In other words, unless the NES and other accompanying export-driven programmes are provided with the resources needed and made a national priority, we will continue to suffer in vain.

We have real possibilities for significantly expanding export-linked manufacturing [AG1] and agriculture. This could also include the new cannabis industries. We also have significant opportunities to grow our service exports. Have we benefited from having Usain Bolt, Veronica Campbell Brown, and other athletes being known all over the world? Have we formed strategic alliances with our musicians for our mutual benefit, Bob Marley and other music pioneers having given Jamaica a gift horse in our music?

These are all areas in which we have significant advantages and in which we can derive near-term success. From these and other targeted sectors mentioned above, as well as others outlined in the NES, we can get quick, sustained, and mutually growth-reinforcing wins.

It is clear, therefore, that Jamaica has numerous opportunities and avenues through which we can achieve real sustainable economic growth and positively impact our current social circumstances. All of these approaches, programmes, and opportunities remain available to us. It is for us to make use of them and have them impact our future in a more meaningful way. We now need to move from talk to action.

As citizens of Jamaica who have sacrificed much, we must stop accepting the blandishment and empty speeches from our political leaders of whatever stripe and demand hard answers, backed by evidence of seriousness. We must demand performance, not platitudes. We must demand that we get firm, measurable outputs from carefully developed programmes and demand that they are properly funded. This is the only way we can evaluate, and, if required, hold the persons responsible for failing us in their stewardship of our collective future.

Gone must be the day where we accept non-performance and mediocrity as the norm and accept PR as a substitute for real tangible performance. This has led us over many years to where we are! We need to demand

that creating and facilitating a significant and sustained expansion in net exports becomes a central strategy of the current and all future governments’ economic programme.

Only then will we begin to see the creation of a virtuous cycle of positively reinforcing economic activities and fulfil the duty of our generation: to leave an economically strong, growing, truly independent Jamaica that is the place of choice to live and do business, for the benefit of all Jamaicans.

New food safety standards for coconut water, after bacteria found

New food safety standards for coconut water, after bacteria found

Coconut producers and vendors in Guyana and other Caribbean Community (Caricom) member states will soon have to abide by new food safety standards for coconut water after scientists found a high percentage of bacteria though no one has been sickened by coconut water, officials said Wednesday.

Executive Director of the Caribbean Agricultural Research Development Institute (CARDI), Barton Clarke said  “unacceptable levels of bacteria” were found in commercially marketed coconut water based on tests conducted by the  the Caribbean Industrial Research Institute (CARIRI) and the Caribbean Agricultural and Public Health Agency (CARPHA) conducted further tests.

“We collected samples of coconut  water from a number of countries, from the side of the road, from supermarket shelves from processors places and we ran an analysis on those. and those results were somewhat discouraging,” he told reporters in Barbados where the Caribbean Week of Agriculture 2018 is being held.

Resources for the coconut development project were provided by the European Union (EU), through the African Caribbean Pacific (ACP) Secretariat. The project is being implemented by the International Trade Centre in Collaboration with CARDI.

In Guyana coconuts at public markets are stored on the ground. Water is sometimes sold in recycled plastic bottles and the same funnel is used on consumers’ bottles they bring to take away for use at homes or restaurants.

Clarke said the Caribbean Regional Organisation of Standards and Quality (CROSQ) has since fine-tuned the regional standard for coconut water. That standard now provides for acceptable levels of heavy metals and coliforms, and how to wash and store coconuts.

“This is very much part of everyday life because we have to ensure that we do nothing to destroy the confidence of the consumer relative to consuming these products,” the CARDI official said.

Managing Director of Technological Solutions  and Chief Executive Officer of Technical Services Limited, Dr. Andre Gordon said his agency worked with CARDI and CROSQ to develop a standard that takes into account the different ways the coconut industry is structured in each country.

CARDI’s Executive Director, Barton Clarke.

“We have a standard that speaks specifically to what the naturally packaged coconut water should be like; what kind of food safety standard it must meet and specifically we looked at making it free from anything that could cause illness,” he said.

“Good practices” include how to pick, handle, wash, sanitise, harvest the water from the nut, packaging freezing or chilling the water.

Coconuts should be lowered into trolleys  or trays instead of touching the ground. “People will say ‘well it’s a coconut so does it matter?’ Well, it does because whatever goes on the outside of the coconut, if it’s not effectively removed ends up in the water when the nut is cut as our research has shown,” Gordon told reporters.

Officials said coconuts on the ground can come into contact with rat urine and animal faeces which could potentially pollute the water during harvesting.

After the coconuts are washed with an effective detergents to remove the contaminants from the surface, he said they are sanitised and placed on stainless steel tables for puncturing or cutting with sanitised tools to remove microorganisms that can cause the water to spoil.

“Some if present, may cause illness although we haven’t found any evidence of coconut water ever being implicated in illness from most of the major microorganisms but want to make sure that once it comes from the Caribbean, any country in the Caribbean following these practices – people can be certain that there is no risk whatsoever of them getting sick,” said the experienced scientist who has also worked in Guyana, Jamaica, St. Vincent and the Grenadines.

The TSL official said if the best practice guide is followed coconut water, the extended shelf-life has moved from three days to 10, 14 or 21 days. He added that frozen coconut water could be keep for four to six months, and if thawed it could keep 7 to 10, or  14 days.

Catalyzing National Development Through Targeted Export Growth

Catalyzing National Development Through Targeted Export Growth

In this presentation Dr.  Andre Gordon looks at some of the factors which have impacted Jamaica’s economic growth over the last 3 decades.

“Over the last 27-30 years successive governments and Jamaica as a country have shifted focus and  have lost the importance of exports to our economic independence.  As a result, Jamaica remains under-developed with a struggling economy as we continue to depend on debt-driven economic growth.  Prof. Donald Harris did yeoman’s work in 1996-97 developing an export-focused National Industrial Policy which has never been implemented.”

Please see full presentation attached.

Handling Food Safety Issues In Paradise

Handling Food Safety Issues In Paradise

Handling Food Safety Issues in Paradise: Part 1—The Caribbean By Linda L. Leake, MS (an Excerpt from captioned article)

“Compliance with the FSMA requirements that have come into force or are approaching their implementation dates is a concern for food manufacturers on the Caribbean islands,” states Dr. André Gordon Ph.D, CFS, Managing Director of Technological Solutions Limited.

Speaking in an interview with Linda Leake, Dr. Gordon shared information on some of the challenges facing Caribbean Food Manufacturers. He indicated that the Preventive Controls for Human Foods Rule (21 CFR part 117), the Produce Safety Rule, traceability requirements, compliance with the Foreign Supplier Verification Program requirements, and conformance with the allergen management and labeling requirement are issues which are all important to exporters. So too is understanding the implications of the full implementation of the FSMA, particularly the Hazard Analysis and Risk-based Preventuve Controls  regulations.

In her article Ms. Leake reports that the Food Safety Modernization Act (FSMA) is among the most prominent food safety issues currently impacting Caribbean exporters, with ongoing inspection of food and ingredient exporters being carried out by the FDA. Caribbean exporters are not only expected to meet the requirement of the US market, but also meet the food safety and quality systems requirements of buyers from the European Union and Canada, as well as complying with labelling, residue, and other limits, being a constant challenge.

In the article, Dr. Gordon emphasizes that Caribbean food regulations, where they exist, need to be based on food safety system principles, rather than on quality criteria.

You may read the full article at http://www.foodqualityandsafety.com/article/handling-food-safety-issues-paradise-part-1-caribbean/

You may also view the Food Quality and Safety Journal February/March issue for this and other food safety related articles at   http://www.nxtbook.com/nxtbooks/wiley/foodquality_20170203/index.php