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News
Observer Reporter  
September 28, 2004

Duties cut

THE government yesterday announced a huge roll-back – by up to 240 percentage points – in the duties on chicken meat and vegetables, in a move aimed at allowing cheaper imports in the face of the severe damage done to domestic agriculture by Hurricane Ivan.

With the reduction, the duties on vegetables such as tomatoes, cabbage, lettuce and carrots as well as chicken legs, thigh quarters and wings will be a flat 40 per cent, down from the range of 86 per cent to 260 per cent.

But Phillip Paulwell, the commerce minister, told Parliament yesterday that the rollback was temporary, to be reviewed in November, and warned importers that the price tariff break was expected to be passed on to consumers.

“The government will not tolerate price collusion or gouging, which robs the consumer of the benefits which this decision is expected to give to the people,” Paulwell said.

“Recommended prices will be published so that consumers will be able to monitor the situation and make informed decisions.”

The reductions mean that tariffs are back to where they were up to April 2002 when they were severely ratcheted-up by the government in the face of complaints of the farm lobby, who argued that they were being priced out of business by cheap imports.

Jamaica, after years of accelerated tariff reductions, fell back on World Trade Organisation (WTO) mechanisms to shield domestic agriculture from what was claimed to be overseas producers who had the advantage of economies of scale and huge subsidies. At time, the agriculture minister, Roger Clarke, and others, cited the need for Jamaica to ensure its food security

But Ivan, with winds of up to 150 miles an hour, accompanied by several inches of rain, caused serious damage across the island but was most severe in the key farming communities in central and south-western Jamaica.

Preliminary estimates placed the agricultural damage at upwards of J$6 billion.

With shortages created by Ivan and from Jamaica being brushed earlier by Hurricane Charley, farm gate prices have begun to rise, threatening to throw further askew Finance Minister Omar Davies’ inflation targets.

Last night, the Jamaica Agricultural Society (JAS) – the farmers’ group – said it was not opposed to the tariff reduction once the move was temporary and aimed at containing prices.

“The decision to review the regime in November is welcomed by farmers,” said JAS president Norman Grant.

The society, Grant said, will be actively involved in monitoring the new regime, especially in ensuring against excessive importation of the listed products.

He also expressed confidence that it would not contradict or undermine the “Eat Jamaican” campaign being promoted by the JAS.

Paulwell confirmed in his statement to the House of Representatives that the JAS has committed to collaborating in identifying products that they themselves can import.

He said that the government will be monitoring the situation during the period to ensure that it does not have a negative impact on the recovery of local production.

The move, Paulwell claimed, will “tremendously enhance” the country’s food security and price stability, while giving the local productive sector time to recover from Hurricane Ivan.

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