Delroy Chuck
THE WORLD Trade Organisation (WTO) ruling on the European Union (EU) tariff on Latin American bananas, which was imposed to protect African and Caribbean countries, will be a major blow. Without the EU tariff, the LA producers will overwhelm African, Caribbean and Pacific (ACP) countries. Already, sugar production is in jeopardy. We cannot compete with Australia, Brazil, Mauritius or other large sugar producers. At present, we produce nothing to compete favourably on the world market, yet without the competitive edge, we are simply going nowhere.
Each year, I attend the Denbigh Agricultural Show to see the wonderful produce of our hardworking farmers. This year, the 53rd annual exhibition, in spite of the hurricanes, floods, droughts and other challenges, our farmers had another outstanding and spectacular display of food crops, livestock and samples of the best of Jamaica. With my deep roots in rural Jamaica, I am always impressed by our farmers' ability to overcome difficulties and disasters to put food on the table. Over the years, it concerns me greatly that our farmers have not been able to make a good living from farming. They have been unable to compete with foreign produce, to avoid the praedial thieves, to meet the high interests costs, to market their products well, or to get the best returns for their crops. What has gone wrong?
Local producers of cattle and dairy products, poultry, farm produce, etc. would collapse without the high tariffs to protect them. But, for how long can these protective tariffs continue? Under the WTO regime, these tariffs will go, and local producers will have to compete globally. I shudder to think what will happen to our poor farmers who now barely survive against the glut of foreign imports? This year's Denbigh theme 'Eat what we produce, and produce what we eat' will become a helpless cry when our borders are fully opened to foreign competition.
FOREIGN COMPETITION
More than ever, now is the time to prepare for the coming onslaught from foreign competition, which is imminent. We need to concentrate on a few crops for export or produce crops primarily to feed our visitors, Jamaicans in the diaspora, and ourselves. What can we produce competitively to make sense and to cater to our export market? In his address at Denbigh, Minister of Agriculture, Roger Clarke, mentioned the potential market of ornamental fish of US$16 billion and herb and spices with an unrealised potential value of US$57 billion. The real problem is that we talk, plan, and spend endless hours and money in preparation without implementing anything worthwhile.
Jamaica has the resources, capability and location to get into any market but, somehow, we allow challenges and difficulties to succeed against our dreams and efforts. Consider Singapore's success in becoming the largest supplier of ornamental fish and tropical orchids to the mainland U.S. Singapore purchases virtually all its water from Malaysia, its land mass is just under the size of St. James, its labour cost is probably a hundred times ours, and it is thousands of miles away from the U.S., but these difficulties did not prevent it competing successfully with the rest of the world. Management, leadership and vision made the difference.
MACROECONOMIC VARIABLES
In truth, when Jamaica produces nothing to compete with the rest of the world, we need to look carefully at our macroeconomic variables. Imagine China, it produces so efficiently and cheaply that the rest of the world, the U.S. mainly, literally begged it to revalue its currency. When a country is producing inefficiently and uncompetitively, like Jamaica, the reverse should occur - a steady devaluation. However, for the past three decades or so, we have committed all our economic effort to protect our overvalued currency to the detriment of our producers, when devaluation would give them the competitive edge.
In the nineties, our manufacturers closed their factories and imported instead, as trading became more profitable than producing. Even now, the government's inability to control inflation inhibits our farmers and producers' efforts to compete fairly with foreign imports. For the past two years, inflation was 16.8 and 13.2 per cent when the target was nine per cent. The government's inflation target of nine per cent this fiscal year will probably be reached in the first four months and likely to pass the 16.8 per cent of fiscal year 2003/4. When our trading partners control inflation below three per cent annually, it becomes abundantly clear why it is not the farmers' fault, or the manufacturers', or the bankers', it is the poor management of our economy why we cannot compete with the rest of the world.
Delroy Chuck is an attorney-at-law and Opposition Member of Parliament. He can be contacted at delchuck@hotmail.com.
