Is the Private sector coming alive?

In December last, the CARIFORUM group, that is, the group comprised of CARICOM and the Dominican Republic, concluded a full ‘Economic Partnership Agreement’ (EPA) with the European Union, or rather with its executive arm. The full details are yet not known. In fact there are calls for wide discussions before the document is officially signed.{{more}} CARICOM’s Council for Trade and Economic Development has agreed on the establishment of an independent review team to make an assessment. While the details of the final document are not widely known, there is general agreement that it will pose serious challenges to business in the region, particularly since we are going to see the end of non-reciprocal preferential trade with Europe. Even though the agreement will be phased in over a period of time, allowing our countries a longer time to prepare for the opening up of our markets, there will be a great deal of urgency involved where Caribbean businesses are concerned. At stake is the fate of domestic manufacturing.

Our economies will be put under a lot of pressure. Tariffs placed on imports constituted critical revenue earning measures for Caribbean governments. The alternative is more tax and bodies like the International Monetary Fund have no hesitation about welcoming the imposition of value added taxes as alternatives, discarding the negative impact on our people, particularly when the tax is imposed on basic goods. Prime Minister Golding had argued that “Our firms may only be able to take advantage of market access in most service sectors offered by the EC (under the EPA) in the medium term, since it will require capacity-building, mutual recognition of qualifications, among other processes”. Jamaica is probably in a position to take advantage of market access in service sectors in the medium term, but I am not sure that St.Vincent and the Grenadines can make such a statement. Really, what do we have to send to Europe that will allow us to do this? So it is one thing to offer us market access, but can we meaningfully capitalise on it?

We are into the age of globalisation, with liberalisation and market economies being central components, and with the World Trade Organisation calling the shots. The Caribbean Single Market and Economy was in a way a response to globalisation, but the CSME itself presents severe challenges to the economies of smaller Eastern Caribbean states. Unfortunately, at the broader global environment ,the playing fields are not level. The movement from a protected market for our bananas to an open market that will put us face to face with competition from others better endowed should demonstrate to us the nature of the beast. I have always agonised over the fate of our businesses and by extension our economies in this global environment. I was worried because we appeared not to be taking this matter seriously. I was, therefore, really heartened when I read last weekend’s newspapers. At last I am beginning to see some signs of stirrings in the business community. At a meeting last week hosted by the St.Vincent and the Grenadines Chamber of Industry and Commerce, we were informed that representatives of over 35 local businesses attended. Their concerns had to do with issues impacting on the business community, issues of a local, regional and international nature. This, apparently, is the first of a series of meetings. Among some of the factors identified were the cost of fuel, raw materials and skilled labour. They had also identified a number of laws which they felt discriminated against local businesses. One of the laws highlighted was the Commodity Bill.

Also appearing in last week’s Searchlight was an article by the Centre for Enterprise Development, under the caption “Exciting year for business development in SVG”. They were highlighting their Business Gateway Project which aimed to support the local private sector. It aimed to assist with the development of human resources, business processes, goods and services, among other things. There was also an article by the president of the Chamber Jerry George, in which he used the analogy of a gazelle and a lion stating that ‘when the sun comes up you better start running”. For him the challenge today was to run smarter, not just harder. He argued that the future of our economies was in agriculture and technology, noting that technology would tell us where to plant and what nutrient is lacking in the soil. He also made the point that Taiwan moved from agriculture to technology to become one of the world’s richest countries. Jerry bemoaned the low priority given to the natural sciences and argued that the social sciences will not earn us a place in the reality of today’s world.

So well, so good, and perhaps we ought to treat all of this simply as the beginning of a conversation, because some of this is clearly over simplified. One cannot conclude that we could follow the same pattern shown by Taiwan. There are so many other things that have to be brought into the equation, including the nature/organisation of our societies, our work ethics and the different environment prevailing. This debate which involves a broader discussion about the so-called Asian tigers was widely discussed about twenty years ago. While I have to agree with Jerry that more priority needs to be given to the natural sciences, one cannot simply dismiss the social sciences and suggest that they have no place. Neither can we dismiss the arts because there is so much involved in development. Development is not simply a matter of technology and sciences. These do not operate in a vacuum and in any event there are so many forces at play.

On the issue of the low state of natural sciences Jerry issued a challenge to the University to urgently address the matter of dwindling science graduates. On this matter we have to identify where the problem rests. The University can only deal with what comes to it. The problem is in country. For quite a long time only at the Grammar School were Natural Sciences offered. Even today with the mushrooming of secondary schools laboratory facilities for the teaching of natural sciences, there still leaves a lot to be desired. In many schools, natural sciences are still limited to Human and Social Biology. Natural sciences are also poorly taught in our schools, so that the University was forced to introduce a preliminary year to assist students in getting qualified to enter their degree programs. As a country, we have first got to identify natural sciences as important and give more scholarships for its study and in ensuring that adequate laboratory facilities are in place. The conversation started by the Chamber of Industry and Commerce is an important one. It demands serious analysis. The issues are many, urgent and complex. The development of our country is at stake because what is demanded is a partnership between government and the private sector in its broadest sense. Government also has to put in place an environment that will facilitate that relationship. So the discussion must also help to inform government policy. We really have a lot to talk about, but at least the conversation has begun.