Look to the south for trade and growth
LAST week Thursday I was invited to attend the Jamaica Exporters' Association annual general meeting where the guest speaker was Brazil's ambassador to Jamaica, His Excellency Antonio Da Costa Silva.
The ambassador took the time to explain the strong ties between Brazil and Jamaica, pointing out that his country was the first Latin American country to recognise Jamaica's Independence, doing so in October 1962. It was also the second, after Argentina, to establish a resident embassy.
Brand Jamaica is already well known in Brazil, one of the largest markets for reggae music. The northern part of the country looks like Jamaica, the people are similar and so are their tastes. Why then did Jamaica only export some US$9.5m worth of goods last year while importing US$240m from Brazil?
It is simply because we are entirely focused on Caricom, North America, Europe and the world. There is an untapped market of 200 million people to the south, not to mention that it is cheaper to ship containerised goods to Central America than to the Eastern Caribbean!
Brazil exports to every region of the world in almost equal numbers, so a diversified strategy protects that country against downturn in any single market. Jamaica, on the other hand, is very concentrated with our traditional markets.
Both governments have done well to create linkages; there is now a Brazil-Jamaica Chamber of Commerce in Brazil, but the private sector in Jamaica has not moved on that here as yet. Airlift arrangements are being organised so that there will be direct flights between the two countries. Barbados already has one flight per week from Brazil.
The ambassador said that when Brazilian tourists started going to the Dominican Republic some 25 years ago they would look around on the way to the hotel and say it looks like Brazil. Why are they in that market? The same will happen with Jamaica, in his opinion, because the typical tourist is a middle class small business owner.
He also stressed the opportunities for joint ventures between Jamaican and Brazilian companies to access third markets while Brazilian firms already have a strong presence in places like Africa. Work is well underway to make such relationships easier by removing tourist and business visas for Jamaicans travelling to Brazil. The first phase is to extend current visa terms from six months to five years. The final plank is tax treaties to prevent double taxation of profits.
Brazil means business and Jamaican companies need to take a serious look at a massively untapped market that could help grow GDP significantly. We must listen to the ambassador and look south to grow, and the private sector must step up instead of waiting on the Government.
-- David Mullings is the CEO of Keystone Augusta, a private investment firm based in Orlando, Florida. He was the first Future Leaders representative on the Jamaica Diaspora Advisory Board. He can be found at Twitter.com/Davidmullings and Facebook.com/InteractiveDialogue