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Stabroek News

Whither manufacturing?
published: Saturday | July 14, 2007

The Editor, Sir:

Many persons are of the opinion that we should import almost everything, because Jamaica is not in a position to manufacture anything.

Among the negatives cited for making us uncompetitive are the high cost of energy, unaffordable financing and an unskilled labour force. The high-energy cost factor has been bandied around for decades, yet nothing significant has been done by government or private sector to reverse this view.

There is also the common view that financing is too expensive, yet this cost has been significantly reduced over the last 10 years and still no new major manufacturing entity has emerged. And the single-digit interest rate on loans is being proposed by the private sector as something that would be a meaningful move in the right direction, there is still the matter of appropriate collateral.

Jamaica was once a leader in regional manufacturing. Representatives from Trinidad and other countries came here to look at what we were doing, then went back home to put into practice what they had learned. Now, look how they have grown.

Technical programmes

There used to be an apprenticeship system where individuals who had an interest in technical employment and had not gone through the formal school system, could use this route to qualify themselves. This was not a six-weeks or six-month programme as is the case now but would last for at least three years. It covered academics, discipline, attitude and values.

Then there were the technical schools, where students coming from these institutions were sought by employers even before they graduated. What has happened?

And, of course, there was the College of Arts, Science and Technology (now University of Technology), where most students, especially engineers, were employed even before graduation, and, in the work place, they hardly had any equal in performance.

We need manufacturing entities because it is the only industry that is least prejudicial in its choice of beneficiaries, directly or indirectly

It is arguable that manufacturing adds more to the government's coffers, directly and indirectly, than any other industry. Directly through taxes and other deductions through PAYE tax, income tax on profits earned, GCT on goods sold and imported. Indirectly through exports, reduced imports or import substitution.

A careful analysis of the manufacturing environment and monitoring of performance is now required to ensure effective returns on investment.

I am, etc.,

Luke T. Shorter

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