Avia Collinder, Business Writer
Farmers group predicts end of monopoly; Coffee Board cautious
Dr Garnet Brown has been hired to lead the merger of three agriculture entities, the coffee and cocoa boards and the export division, into a single agency.
The process will strip the newly created commodity board of all commercial function but leaves it regulatory authority intact.
Donovan Stanberry, the permanent secretary in the Ministry of Agriculture and Fisheries, said the consultant will operate from the ministry's Hope Road, Kingston offices, starting August 13.
Stanberry did not specify how long the process would take.
"Brown is to lead the process of transformation — legislation, organisational structure, and staffing — with the overriding objective to ensure optimal efficiency and effectiveness in the management of the commodities interest," the ministry said Wednesday.
The possibility of a commodity merger has been in the air for about a year, but the cocoa and coffee boards, as well as the private growers, still seem to be weighing the full implications for the sectors in which they operate.
Mordecai Buckley, operations manager of the Jamaica Cocoa Growers' Association (JCGA), said he hopes the new structure and agency to emerge from it will have no relation to old monopolistic operations.
"I think that it will benefit both the coffee and cocoa sectors. It will also benefit the Government as it should serve as a cost-reduction exercise," said Buckley. "The question though is what form this merger will take? Will it still have the form of the bureaucratic juggernaut in the case of the cocoa board that helped to cripple the same industry for which it was designed to serve? Will it move away from the monopolistic model? I think these are real issues that need to be addressed."
The president of the JCGA, Clayton Williams, said the new body should restrict itself to quality control and assistance with marketing, and that the rationalisation not be used as an excuse to create another tax on exports in the form of fees.
"It must be noted that the crops affected by the merger have several unique factors relating to how they are marketed and sold, and the peculiarities of each must be taken into consideration during the regulatory process," said Williams.
The cocoa grower also insisted that the new agency include industry players on any committee that is instituted.
"Such a system has been successfully implemented in the Dominican Republic, where the private sector is viewed as partners and not as subordinates to be controlled," Williams said.
The decision to merge flowed from an agriculture ministry sectoral study on the commodity boards commissioned back in May 2009 against the background of low production and productivity, due largely to inefficient marketing arrangements.
The study was finalised by FocalPoint Consulting last year and approved by Cabinet in February of this year. The document was made public on June 29.
"The ministry commissioned a study to examine specific crops which are managed under the auspices of commodity boards. Based on the recommendations of the consulting firm which conducted the study, the Cabinet decided that the institutional arrangements and functions be rationalised," the ministry said.
Buckley endorsed plans on paper, which appear to confine the entity to a regulatory role only.
"In my opinion, the role of the new board — whatever it will be called — should be purely regulatory and let the marketplace deal with the agricultural, marketing and commercial functions of the industry. Overall, I think it will be a win for the Jamaican cocoa and coffee farmer," he said.
The director general of the Coffee Industry Board, Christopher Gentles, was a lot more cautious.
"On the surface of it, the government policy is clear. The merger will take place. They are hoping to generate savings. But, the devil is in the details. When we see the consultant's report, we will know fully what are the synergies which will result," said Gentles.
The coffee board, despite detractors of its tight hold on marketing, trademarks and sales, has been credited with resurrecting the Blue Mountain brand as a boutique luxury product that fetches premium prices primarily in Asian and European markets.
In the cocoa sector, a war of words is being waged over what was initially the planned divestment of state-owned cocoa assets as well as marketing of the bean.
The man hired to design the new agency is said by the ministry to be a "veteran" public servant with a 40-year track record and expertise in organisational development and mergers.
Brown was described as the founding executive chairman of three state bodies:
Rural Agricultural Development Authority, which itself evolved from the merger of 13 Agricultural Land Authorities into one national organisation;
National Irrigation Commission Limited, which is a merger of four non-performing irrigation bodies; and
Management Institute for National Development, formed from the merger of four Government training institute.
He was also a founder of the Natural Resources Conservation Department - forerunner to the Natural Resources Conservation Authority - which also evolved from four merged agencies.
Brown was educated at New Brunswick; Yale; and Oxford University. He is also a theologian.