Look to manufacturing!

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Look to manufacturing!

Al Miller

Monday, January 20, 2020

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No country is ever successful in the long term... without a really strong and vibrant manufacturing base. — Alan Mulally

We are now just about a decade away from 2030; the year that our planners signposted that Jamaica could become so prosperous that the whole world will see this island nation as the place to live, work, raise families, and do business. It is the hope that the year 2030 will see us achieving First-World status.

Since that is our goal then we must of necessity at this time analyse where we are and what it will take to get there. Sir Winston Churchill of Britain reportedly advised, “However beautiful the strategy, you should occasionally look at the results.”

Considering that there are nations who have preceded us in becoming “the place to live, work, raise families and do business”, we must ask ourselves what has proven to be the sure foundation on which these strong sustainable economies are built? Are those the things on which our economy is being built or have we discovered a better way? If we have not discovered what is better then we must evaluate and adjust with immediateness.

It is an indisputable fact that the manufacturing sector is a growth engine for any nations' economy. Delroy Warmington, writing in this newspaper on April 11, 2019, in a piece titled 'Manufacturing — The bastard child of the PNP and JLP' observed that, “When we look at countries such as Belarus, Vietnam, Laos, Cambodia, Ethiopia, Malaysia, and China, which averaged over five per cent growth in the period 1996-2016, they all have robust manufacturing sectors.”

A developed high-quality manufacturing sector has always been the primary way of how First World, wealthy nations have developed. England, USA, Germany, Taiwan, Korea, China, Japan, etc.

Developing nations like ours and small-island states are not to consider themselves too small for manufacturing, or think it is unnecessary because our service industries may be booming. Both Richard Pandohie, current president of the manufacturers' and exporters' association, and Omar Azan, past president, were recently very instructive about the importance of the sector in the Jamaican economy and the need for greater emphasis to be placed on building its productive capacity. ('Manufacturing growth — Local product makers demand level playing field, urge greater focus on sector', The Gleaner, January 12, 2019)

A key to wealth creation is adding value to others by meeting a need they have. The primary ways are offering goods or services needed. The ability to do both is always better.

A nation's wealth ought to come from harnessing and developing to the maximum its natural resources. Hence, we should jealously guard and develop our environment with its natural resources. Destroying, undervaluing, or disposing the natural resources to others is national suicide.

Our early fathers in many ways did that to our detriment — out of ignorance and fear. Our subsequent leaders continued it out of expediency and greed. Our current leaders must redeem it with vision, boldness and love for country as priority to make Jamaica win.

The larger percentage of a nation's economy should be built upon the sustainable development of its natural resources, manufactured to high-quality goods to meet local demand and export its surplus. Service industries should be a supplement to our manufacturing sector. The current centrepiece of our economy is tourism, but I believe it should be 'brawta', not the mainstay of the economy. Tourism is too fickle, as our whole destiny is therefore placed outside of our control and in the hands of others. We literally are depending on people with disposable income in economies susceptible to external shocks. Any events in the nations from which our tourists come could devastate us and even wipe us out. We should never put ourselves at such risk. Such a situation makes us weak and vulnerable. This decade must see us realigning to build the economy on the solid foundation of manufacturing all our natural resources.

The principle that should be applied is as the Creator designed it; to seek your prosperity and success from what you have in your hand and not what you don't have.

What does Jamaica have? Bauxite, some minerals, good soil and climate that produces yams, bananas, sugar cane, herbs, spices, medicinal plants, sun, beach, and sand. We have sought to develop only the most fickle. How many nations have become great on fickle tourism?

I am not criticising our progress in growing our tourism industry and the tremendous job that Minister Ed Bartlet is doing. Nor am I dissuading us from continuing to expand its role in our economy and its contribution to our GDP. I am calling us to a deeper principle and rethink to be positioned for any realities in a fast-changing and expanding world.

Agriculture for food security should aim to be as self-sufficient as possible, and then for export of foods, herbs, spices and medicinal plants. There are undeveloped 'gold mines'. Major research as a precursor to establishing manufacturing opportunities should be in full flight in these areas. For example, we should be world leaders in all aspects of the cannabis industry. We should not just be planting and reaping yams; by now we should have established a manufacturing plant to extract the enzymes found in yams that purportedly improve one's athletics performance. We should not be giving away our manufacturing industry to foreigners but securing funding to allow local control and local development. We should have been and must now begin to develop our natural resources and natural endowments with a view to manufacture niche products and products that give us a competitive advantage on the world market.

Speaking of niche products, can somebody tell me why the manufacturing of our famous herbs into tablets and capsules has not been taken on as a serious manufacturing project? Yes I know that a few herbal drinks and roots products have been springing up. But health food and athletic stores in the USA and China should by now have been inundated with our herbs; some of which I am told can nearly raise the dead.

The Government has to lead in securing (or allocating) funding for this; as the private sector cannot be expected to take the risk, make the shift, and wait for returns. Government has to incentivise the manufacturing areas we want to see grow. Long-term planning of visionary and strong government will pursue a solid path. Many Christians in our nation have been praying and believing for other minerals to be found that will provide a strong base to boost our economy.

We must between 2020 to 2030 aggressively invest in development of our natural resources into production lines of high-quality manufacturing products. Warmington in his article mentioned above, interestingly posits that we should also consider remanufacturing as a viable opportunity in the expansion of our manufacturing sector.

In the case of remanufacturing, Jamaica has some distinguished attributes. Jamaicans think they can fix anything. If your car breaks down and a lady is passing on a donkey, she is likely to offer ideas as to how to repair your car. If you put out an iron, a fridge, a stove, or any electronic device, it is almost certain someone is going to take it and try to repair it. It is natural for Jamaica to be a dominant player in the remanufacturing sector.

No matter what area we start with in the expansion of this sector, what is for sure is if we are not manufacturing goods we are on shifting sands. Manufacturing is the only basis of real hope of prosperity for our people. It's key to job creation and development of our small and medium businesses, which are known to be the engine of growth.

I suspect we have got in a rut for the last 30 years just focusing on trying to win the next election five-year cycle and preoccupied with the treadmill of the debilitating social problems, such as crime and corruption. As a result, our leaders have not had time to lift up their heads, look, analyse our current situation and with vision chart a course that will get us to the destination desired. This reminds me of a question I have been asking for a few years now: Where is the think tank that is thinking through ideas and processes that will work, while the political leaders have their noses down, outing fires in the daily grind of managing the problems of the country? I believe this is why we see things and wonder why our leaders can't see it.

Although the service industry is good and helps our country, we cannot trade services for goods. The present service industry model cannot be relied on by itself to secure our future and bring prosperity to our people. Manufacturing is the solid base for hope. Therefore, for the next decade, it must be given the support to expand to contribute to our economy even more strongly than our service sector. Together they form the perfect way forward for Jamaica, land we love, to achieve First-World status by 2030.


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