Good things come to those who get up and get themSunday, April 04, 2021
There were two important events that took place this year which may have missed the attention of the West. The first was on January 1, 2021, when the African Union launched its African Continental Free Trade Area (ACFTA) — a single continental market of 1.3 billion people with a combined gross domestic product (GDP) of US$3.3 trillion. This trading area is the largest in the world in terms of the number of participating countries since the formation of the World Trade Organization. With its complementary single African air transport market a protocol on free movement of persons, trading, as well as duty- and quota-free designations on all goods and services being traded, the United Nations estimates that intra-Africa trade will increase from 13 per cent to 52 per cent by 2022, which could lift 30 million Africans out of poverty.
The second event occurred on February 28, 2021 at the Federal Assembly of the Swiss Confederation, in Bern, when the president of Ghana Nana Addo Dankwa Akufo-Addo proclaimed that there would be no prosperity for the Ghanaian people in the short, medium, or long term if they maintained economic structures that were dependent on the production and export of Ghana's raw materials. Consequently, he declared Ghana's cessation of its cocoa beans export to Switzerland — a commodity which the Swiss have used for decades to make expensive chocolates. Ghana would be creating its own value-added products “at the high end of the value chain of the global marketplace to create jobs for the masses of Ghanaians”, indicated Akufo-Addo.
It may take some Jamaicans by surprise to discover that the formula for the Cadbury brand of chocolates — the world's second-largest confectionery company — had its original roots in Jamaica. In 1687 Sir Hans Sloane came to Jamaica and, while living here, developed the formula for liquid chocolate, which he later patented and sold to John Cadbury in England. Several attempts in 1938 to establish a chocolate factory in Jamaica by the Cadbury family were futile. Decades later, Jamaica has still not developed a robust value-added production culture using our raw materials. We continue to export our coffee beans, bauxite, and other raw materials at the mercy of world commodity pricing.
Real economic independence takes effect when a country controls the value chain of its production from raw materials to finished goods. The Africa Union has embraced this concept and many of its member states are now pursuing fundamental shifts to structurally transform their economies to focus on production where they have identified sustained competitive advantages globally. Ghana's tactical gambit in Bern was another move in this country's new era of industrialisation for its economy which has been growing at a rate of seven per cent per annum since 2017.
The old saying that “good things come to those who wait” is just that... old. In the new economic order, good things come to those who get up and go get them. The Dangote Group and MRS Holdings, established by two visionary Nigerian brothers, have developed the production capacity over the years to compete with anyone, anywhere in the world with building and agricultural products, oil, gas, food, and shipping. No longer do countries in Africa have to import finished goods in any of the items these companies manufacture.
I had the opportunity to tour one of MRS's modern production plants on my last visit to Lagos in 2018. This facility, with less than 60 employees, was producing four million bottles of engine oil per day to fill 70 terminal containers for export. Today, Aliko Dangote's sharp business acumen and push towards African self-reliance has made him into the world's wealthiest black man with an estimated net worth of US$11.5 billion.
Jamaica must pick winners
In Jamaica, we are still talking about general plans and policies approaching the concept of national growth and employment creation for our people in the same way for 50-odd years. The existence of Jampro, the Economic Growth Council, the Ministry of Economic Growth, the Ministry of Foreign Affairs Co-ordinating Unit for Foreign Trade, the Ministry of Agriculture, the Ministry of Industry and Commerce, the National Export Policy, and the National Trade Policy has not done much in producing any real tangible results.
A closer look at the data for 2019 reveals Jamaica lagging behind other countries in the region for exports of goods and services per capita. Trinidad and Tobago, with a population of 1.39 million, exported US$9.1 billion with a per capita figure of US$6,547. Jamaica, with twice the population, exported US$1.5 billion with a per capita figure of US$535. The data of others blessed with less natural resources and agricultural output still beat us. For example: Cayman, US$24,296; The Bahamas, US$3,660; Barbados, US$1,547; and Panama, US$1,317.
Like the Cayman Islands, who export financial services, one of our greatest opportunities is the export of our culture and the development of the Jamaican brand. In 2007 the total value added by copyright-based industries accounted for US$192 billion in exports from the United States of America. By 2017 it exceeded US$2.2 trillion. I will expand on this at another time.
However, it's time we pick winners in the manufacturing sector. We should recognise by now that to compete in the world we must meet certain quality and production international standards. Jamaica can no longer afford to produce only 'samples' in goods and services.
It will take serious political will, investment, and management to fill containers that leave our ports and get us to where we need to be, which is to earn more foreign exchange. This is why I continue to stress the need for a new economic model in which we have national factories that buy the raw materials from our small farmers at guaranteed prices to produce exclusive Jamaican value-added products at world-class standards for export.
Jamaica will never create true wealth for our three million people by just selling to our three million people. Our market is too small. We should follow Ghana's example to produce higher value-added commodities right here at home. Rather than exporting our raw coffee beans, for example, we should produce the packaged coffee, energy drinks and bars, cosmetics, liqueurs, and other beverages. By taking this decision we would signal to the world the importance of the Jamaican brand, while simultaneously protecting it from being exploited by other countries.
The time is urgent for us to become global producers of Jamaican-branded products the world loves. The same emotional connection people have with our music and sports can extend to our branded manufactured goods exported around the globe.
Lisa Hanna is a Member of Parliament and People's People's National Party spokesperson on foreign affairs and foreign trade.
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