Trade and economic rejuvenation
It was gratifying to read the Jamaica Observer’s editorial on Wednesday, September 3, 2014 that highlighted the many dysfunctional aspects of trade in Jamaica both domestic and international. It is of the utmost importance that our business leaders work towards gathering the trading companies and to once more amalgamate the strength of this body into a productive force which can move our ailing economy forward.
Reflect for a moment on these comments from 1979:
“I believe we need to encourage small business people to work towards becoming big. I think we need to show them that most of the big merchants of today were the small businessmen of a few years ago, and I think that if we can put together a larger number of business people, all working for the good of the nation, all believing in private enterprise and dedicated to a better Jamaica, then we can have only hope for a better things in years that lie ahead.” — Carlton Alexander, president, Private Sector of Jamaica
“I am convinced that the Chamber, having played its role over these very difficult years, will continue to do so with distinction in the future. And I, for one, know that the nation can count on it to continue to work assiduously and unselfishly with other interest groups within the society to serve the best interests of the country in the years to come.” — Winston Mahfood, president, Jamaica Manufacturers’ Association
“With two centuries behind it, the Chamber faces its third century in a situation which demands the utmost of the skills and experience it has developed. The profound change in the direction of development, together with the growing need for extensive expansion of our export potential, mean that the entrepreneurship of the Chamber and its members can create new opportunities and new wealth for the country. The exporters of Jamaica are themselves in this attempt to refocus the thrust of Jamaica’s development and play their role in the future.” — Prakash Vaswani, president, Jamaica Exporters Association
The above illustrate that there is no loss of culture of production.
So it was before the fragmentation of the private sector that resulted from an overwhelming wave of egocentricity that included “turf wars” among other disagreeable events, which swept business enterprises along a critical path where they erroneously believed the individual pieces would be stronger and more effective than the whole.
The situation today is much improved and the ingredients for success are around the corner. Export and manufacturing for export is now a major part of the Government’s growth and development strategy, as contained in the Jamaica Trade Policy 2014, which has been formulated over a period of three years and about to go into effect.
The changing attitude in the private sector has come about due to an extraordinary occurrence involving Government and donors, who informed the business community that future requests for funding should be presented collectively as a single project and no longer in piecemeal form. Further, they want to deal with a single business entity which represents the private sector.
This new regime gave birth to the Private Sector Working Group (PSWG) — a composite of the main trade associations and other relevant entities from the sector. The group went to work and produced a report that embodied a proposed approach to the future relationship of the PSWG with donors and Government. The final report had concluded that a single unit should be established to deal with all matters pertaining to trade facilitation, managed jointly by business persons and government personnel. This organisation is now a work-in-progress and promises to remove many of the various difficulties that have plagued progress in the past. The PSWG has given way to the new group yet to be named, and plans are proceeding.
The Observer editorial stated: “One inexpensive way in which the Government can support exports is with export market information, the lack of which is often the barrier to exporting. This information should be a public good, freely available to the public and covering such issues as what goods and services are demanded and, where they are in demand, and be that as it may, what are the standards required, and what is the prevailing price in global markets.”
This arrangement was already in place, entitled Economic Diplomatic Diplomacy, and a meeting was held, and the private sector guests were introduced to the foreign service ambassadors and high commissioners to discuss the plan to introduce economic diplomacy. The proposal was well received, but unfortunately it has not been repeated.
The Observer editorial continues: “Removing the information deficit would enable local producers to be converted into new exporters, encourage the establishment of exporters, and facilitate existing ones to expand their output to introduce new export products, and diversify export markets.”
We are encouraged by the new beginning, as seen with the conversion of GCT to a refundable tax on imports for export manufacture, and the new capital allowance incentives along with the undertaking to examine other duties and charges being applied on imports intended for re-export. In addition, the series of reviews of the Customs Administration Fee (CAF), based on multiple consultations with stakeholders, resulting in savings for the productive sector, including exporters, have all been very helpful.
These positive developments are indicative of progress towards the end goal that is closer cooperation between the private and public sectors for the greater prosperity of the nation.