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Sir William Arthur Lewis (Virtual) Distinguished Lecture: Sustained Economic Recovery Post-Pandemic – The Lewis Model, presented by CARICOM Secretary-General Dr Carla Barnett


I am deeply honoured to present the Sir W. Arthur Lewis Distinguished lecture this year under the theme “Sustained Economic Recovery Post-Pandemic: The Lewis Model”.  In our region and across the world, we are preoccupied with building a post-pandemic economic recovery notwithstanding the persistence of the COVID-19 Pandemic. 

I recall the great pride I felt as an undergraduate in an Economic Development course at the University of the West Indies, Mona, reading Lewis’s seminal contributions at the same time he was awarded the Nobel prize.  I also recall the many debates about the relevance of his policy prescriptions to the crises of that time.  These debates were particularly concerned with his “Unlimited Supplies of Labour” treatise and what it meant to agriculture-based economies trying to move directly to service economies.  The debates were, of course, mostly among the professors and lecturers. As young undergrads, we listened keenly, trying to figure out what the fuss was about because, clearly, Lewis had to have been a great economist to have been so recognized, but more than that, he was also a black man and a fellow Caribbean National. 

While many acknowledged and applauded Lewis for his scholarship, ingenuity and pioneering research in development economics, he was also severely critiqued for his prescriptions for developing economies as embodied in his seminal models on growth and economic development, the main fight being over the role of foreign capital. The debates between the Lewis model and the Plantation model raged along the spine of the then Social Science building.

Lewis saw himself as a simple man, who evolved and developed as opportunities arose.  He apparently started out wanting to be an engineer but was prevented from doing so because that opportunity was not there for a Black West Indian youth. So, he became an economist and rose to ranks most economists cannot even contemplate.  Norman Girvan recounted that Lewis gained First Class Honours at the London School of Economics (L.S.E.), and a PhD in Industrial Economics at the age of 25.  He went on to join the Faculty at L.S.E. and later became a Professor of Economics at Manchester University.  He was the first black Nobel Laureate in Economics, the first West Indian Principal at the University College of the West Indies (UCWI), the first Vice Chancellor of the University of the West Indies and the first President of the Caribbean Development Bank.

Moreover, Lewis was the epitome of a CARICOM National – his parents were Antiguan and moved to Saint Lucia where he was born. He lived and worked in Barbados and Jamaica while providing advice to many Caribbean governments of the day.  Lewis also advised governments in Africa, notably both Nigeria and Ghana. He later became the first black Professor at Princeton University. When Lewis returned to the Caribbean in 1959 and subsequently became Vice Chancellor of the UWI, he was in his mid to late 40s.

I suspect that the pre-occupation with “the Lewis model” is not something that Lewis himself would have favoured.  He is said to have argued that his intent was not to present a refinement of abstract models but an indication of how development, understood as a multidimensional process of economic, social and institutional change, could be tackled in a problem-solving way through instruments of public policy.[1]  While the insights provided by ‘the Lewis Model’ could provide an anchor for a pro-active strategy for growth, structural change, and resilience-building in CARICOM Member States, his focus on careful planning, policy-making and effective implementation through well managed and efficient agencies of government is equally important.   

Lewis was a different kind of economist. As a development practitioner, he understood that pure economics – that business of differential equations and internally consistent model-building – has its place in thinking through how economic systems work. That is the “science” part of economics being a “social science”. But he also understood, and taught, that in making the transition from models to policymaking and implementation, the wider considerations of society – the “social” part of economics being a “social science”, was also critical.

Of course, Lewis was also a regionalist who saw the then British West Indies (BWI) as an integrated whole as against individual small states separated by the Caribbean Sea and notions of sovereignty.  His prescriptions for achieving Caribbean development therefore embodied a vision of what can be achieved together.  His vision for Caribbean development was premised on two maxims he held dear and which were instilled in him by his mother, having lost his father at the age of 7 – “Anything that they can do, we can do” and “Make the best of what we have.”  These maxims influenced the way Lewis conducted his life and permeated his prescriptions for the economic development of Caribbean States which he envisioned as having the capacity to become self-sufficient, dynamic, and competitive economies with the support of active government policymaking. He saw the Caribbean economy as part of the international economy with all that the inter-connectedness and inter-dependence implied for national and regional policy-making.

Girvan[2] memorialized Lewis as – “A Man of His Time, and Ahead of His Time” both for the breadth, depth and scholarship in the subjects he investigated as well as the continued relevance and salience of his prescriptions in today’s world.  Indeed, the 2021 UNCTAD Trade and Development Report acknowledged the relevance of the Lewis Model of development for a climate constrained world and reiterated its efficacy as a “heuristic device for the study of economic development through which contemporary patterns of structural transformation and their implications for inclusive growth, wages, profits, employment and productivity can be examined.”[3]

State of CARICOM Economies

Before going further, I want to look briefly at the current state of CARICOM Economies and the development challenges that we are now confronting.

The COVID-19 Pandemic over the past 2 years has derailed the emergence of CARICOM States from the low growth, high debt cycle that has prevailed for several decades, worsening after the 2008 global financial crisis and intensifying in response to cyclical devastation from the annual Atlantic hurricane season.  The economic shock brought on by the pandemic worsened the inherent structural vulnerabilities that we know so well: limited economic diversification reflected in the narrow economic base, high structural unemployment and dependence on foreign capital and international trade for both consumption and production.  The pandemic also amplified the challenges confronting CARICOM States in the pursuit of economic transformation and resilience: the overwhelming susceptibility to natural disasters and climate change impacts including flooding, coastal erosion, rising sea levels, and deforestation which result in significant loss and damage.  We have had hurricanes cause our countries damage estimated in the multiples of their annual GDP.  

When economic activity was curtailed to help prevent the spread of COVID in 2020, with the exception of Guyana which has been experiencing extremely rapid economic growth fuelled by investments in oil and gas, CARICOM States experienced significant GDP losses in 2020 and 2021 that were much higher than other regions of the world.  Job losses in CARICOM States were also significantly higher than in other parts of the world and women were hardest hit by the job cuts and bore an even heavier burden of care work at home and in the health system.   Job losses were most significant in the tourism sector and related services as well as the manufacturing sector which was considerably impacted by the pandemic-induced supply chain disruptions.  Private capital inflows to most CARICOM States have also declined considerably since 2019.

The economic slowdown also led to a depletion of government revenue even as governments were faced with additional expenditures on health infrastructure, safety supplies, medications and social safety nets.  The public sector financing gap (estimated at around US$5 billion in early 2021) and the external debt are therefore continuing to grow beyond unsustainable levels.   By the end of 2020, six (6) CARICOM States had reported a debt to GDP ratio above 100% as compared with one Member State in 2019, visibly reversing improvements in debt dynamics that had begun to emerge around 2019.  Even as our countries are attempting to carefully restore economic activity, the emergence of new strains of the COVID-19 virus means that CARICOM Governments will continue to spend to manage COVID even as they are moving to address the prevailing development challenges.  

President Leon of the CDB has succinctly characterized the Community’s development challenge as “not merely to recover lost ground and close the distance to achieving the sustainable development goals (SDGs), but to fundamentally alter our development path to place our societies on a higher and more sustainable welfare path in the future.”[4]  

The Challenge Ahead

Recalibration of our growth and development strategy must take into account risks emanating from the global environment.  The Russian-Ukrainian war has further amplified the prevailing economic risks and uncertainty confronting small states, including increasing inflation; financial stress; fragmentation of trade, investment and financial networks; as well as cyber-security risks.  The sharp increase in inflation worldwide, driven by the upswing in commodity prices (particularly oil, wheat and fertilizers) and supply chain disruptions which has triggered higher costs of shipping as well as dampened the demand for tourism services.  The inherent vulnerability to climate risks and natural hazards as well as the reputational risks due to the heightened regulatory action on the money laundering, terrorism financing and global taxation landscapes are also significant challenges confronting CARCOM States.  These multiple risks now have to be managed to mitigate their impact on the policy space available to CARICOM States in charting the recovery of their economies.   

So how do the insights from the Lewis Model assist us in better strategizing to overcome the extant development challenges amidst the prevailing risks both inherent and driven by global shocks and developments? I submit that we can draw insights from the ‘Lewis Model’ that are relevant to the CARICOM development process and will reference the following specific six areas: –

  1. Proactive role of regional integration in building self-sufficiency and resilience;
  2. Importance of harnessing technology to modernise the agriculture sector and the scaling up of agri-food production to ensure food security;
  3. The critical role of capital (both foreign and domestic) in driving growth-enhancing structural transformation;
  4. The importance of increasing domestic savings to finance investment (and by extension the importance of enhanced regional resource mobilization); 
  5. The State as a direct participant in economic activity, and as a facilitator (that is, the importance of state capacity); and
  6. Creating a highly skilled labour force to drive productivity.

Let us take these in turn and perhaps we can consider how this regional university can help this region to address them.

1.      Proactive Role of Regional Integration in Building Self-Sufficiency and Resilience

As noted earlier, Lewis was a regionalist.  He saw our countries coming together as a single economic unit to overcome the market limitations of small size, to exercise the power of their collective sovereignty on the global stage and to act as an instrument of good governance.  He therefore worked tirelessly to preserve the then West Indies Federation and to establish a customs union but became convinced that the issue of regional governance was a constraining factor.  In this regard, he envisaged visionary leadership, consensus building and social cohesion as the basic requirement for the transformation towards ‘making CARICOM a lived experience.’

The Community is now on the brink of celebrating 50 years of the regional integration project. It was five years after the West Indian Federation collapsed in 1963, that the Caribbean Free Trade Area (CARIFTA) came into being in 1968.  By 1972, CARIFTA gave way to the Caribbean Community and Common Market which was established by the Treaty of Chaguaramas in 1973.  The Revised Treaty of Chaguaramas in 2001 heralded the evolution towards the Caribbean Community, including the CARICOM Single Market and Economy (CSME). The CSME was intended to be a single economic space which facilitates access by CARICOM nationals to the collective resources of the region on a non-discriminatory basis and allows CARICOM businesses and persons to take advantage of a larger market size, potential scale economies in production, and other size-related incentives and efficiency possibilities.  In so doing, the CSME would therefore enhance competitiveness, stimulate greater productive efficiency, higher levels of domestic and foreign investment, increased employment, and stimulate growth of intra-regional trade and of extra-regional exports.

The fundamental objective is an improved standard of living for the people of CARICOM.  The CSME, as conceptualized, was therefore a platform for building regional self-sufficiency and economic resilience.  I rather suspect though, that while Lewis would find favour with the concept, he would be saddened by the progress, to date. But, he would probably also set about studying the problems that keep back progress and place focus on the need for careful planning, policy-making and effective implementation through well managed and efficient agencies of government, in this case regional governance structures and processes.

The Single Market infrastructure is largely in place.  These are the rules and procedures that have been created to allow for movement of categories of persons and goods within the Community.   The question continues to be, why does this infrastructure not facilitate such movement? Clearly there are issues of knowledge of the processes for free movement among the people of the community, the complexity of the bureaucratic processes and the unequal application of the rules across Member States. With regard to the free movement of goods, the use of non-tariff barriers continues to arise from time to time. With few exceptions, there has been a reluctance to use the provisions of the Treaty and/or court action to ensure that rights and responsibilities are properly exercised.  Beyond free movement, the macroeconomic and sectoral policy frameworks aimed at incentivizing private sector investment and trade across the region are still emerging, still to be adopted twenty years after the Revised Treaty was signed.

Accordingly, much of the beneficial impacts that are to flow from the CSME arrangements are yet to be realized.   Intra-regional trade in manufactured goods and agri-foods has lagged well behind the level of trade between CSME Members and third countries and the pattern of trade within the Region is significantly skewed towards the More Developed Countries. Inadequate intra-regional shipping, high freight and other logistics costs, complicated payment arrangements, and unnecessary bureaucratic measures all serve to frustrate exports, especially from the Less Developed Countries to the More Developed Countries in the Community.  In addition, Member States have not taken much advantage of the market access conditions negotiated with external parties such as the EU and the UK as well as countries within this hemisphere; and without structural change and economic diversification, Member States will be hard-pressed to find products to export.

While the CSME is still very much a work-in-process, stakeholders have acknowledged that there is a huge “information deficit’ regarding the CSME among the ordinary citizens of the Community and a major “credibility gap” regarding its completion.  Last month, Heads of Government, demonstrating a degree of pragmatism that Lewis would undoubtedly favour, agreed to a Protocol on Enhanced Cooperation, that will allow Member States that are ready to move forward with the implementation of Community initiatives to do so, with other countries following when they are able to. This is a major change from the previous practice of no forward movement until all are ready to move forward. This single change can result in acceleration in several areas, particularly with regard to the Single Market and the macroeconomic policy framework.

Agreement on this Protocol, points to the determination to confront the challenge of implementation by carrying out reforms in the way the Community’s affairs are conducted.  Those reforms are filtering through the CARICOM system, including the political and institutional elements of the Community, including closer, more strategic collaboration and coordination between and among the Regional Institutions and the CARICOM Secretariat, as we work together with Member States to trim the implementation deficit.

I would like to think that, at this moment, the Community’s governance framework is moving decidedly towards the basic principles that Lewis established for the transformation of CARICOM States: – vision, consensus building, and social cohesion. But the jury is still out.  This – the governance structure and function of CARICOM – is one area that begs further study and invites research by students and academics at this regional university.

2.      Harnessing Technology to Modernise the Agriculture Sector, Expand Agri-Food Production to ensure Community Food Security

A central approach in the Lewis Model is the transformation of agriculture from a subsistence sector by ensuring that farms were large enough to provide adequate living standards for farmers and that, through the application of appropriate technology, increased productivity contributed to expanded agri-food production.  Agriculture was seen as a major contributor to socio-economic development, developing in parallel with manufacturing via the emergence of backward and forward linkages. 

Across our region, we have tended to treat agri-food production as a residual sector with inadequate public resources being allocated to drive productivity improvements. Our historical tradition of focusing on plantation agriculture for export with residual subsistence food production continued even after plantation production faded with the removal of preferential access.  The policy approach could be described as appearing to have equated food security with the ability to import food from third countries. Data show that in 2019 the agriculture, forestry and fishing sectors accounted for less than 10% of GDP in 10 of the 13 CARICOM States for which data were available. The Agriculture Sector, by itself, contributed less than 5% of GDP in 6 of the 13 CARICOM States. 

Then the Covid-19 pandemic came, accompanied by the breakdown in global supply chains, coupled with rising food and commodities prices and shipping costs.  The threat to food security was absolutely clear.  Even before COVID, CARICOM had agreed in 2018, to target a reduction of 25% by 2025 in the US$5 billion food import bill as a way of stimulating economic growth and regional trade.  Work began, led by a Ministerial Task force supported by technical specialists from Agriculture Ministries and the CARICOM Secretariat as well as international and regional institutions, including the UWI, supporting regional agricultural development.

The threat to food security brought on by COVID has given even greater impetus to this priority and the effort is underway to bring together the public and private sectors to increase investment in agriculture.  Supporting initiatives include the establishment of an agri-food trade and information system along with the accelerated delivery of sanitary and phytosanitary protocols by the Caribbean Animal Health and Food Safety Agency (CAHFSA).  The implementation of a comprehensive E-Agricultural strategy where digital technologies can be incorporated to promote increased production, improved productivity, market connectivity and efficiency, information sharing and reduced transaction costs is a major initiative under the Agri-food expansion strategy.

This CARICOM priority is being led by the President of Guyana who, among Heads of Government, has responsibility for agriculture. A critical aspect of this work will take place next month at the Agri-food Investment Forum and Expo which will bring together farmers and agro-processors from across the region, potential regional and international investors, multilateral institutions, private sector organisations and others, with a view to yielding profitable partnerships for investing in grains, livestock, fruit and vegetables, exotics/niche market specialties and more. 

The transformation of Agriculture and the expansion of agri-food production is a major imperative that is expected to increase the volume of intra-regional trade, but for this to really happen the challenge of reliable and efficient maritime and air transportation must be resolved. Studies have shown that resolving the transportation challenge could boost intra-regional trade by at least 200 percent and there is also no doubt that affordable travel would allow for greater co-mingling of our people, thereby strengthening the feeling of belonging to a Community. 

This transportation challenge requires much study. What is the appropriate role of both the private and the public sectors in developing regional transportation infrastructure?  To what extent can we and should we see regional transportation as a public good?  Why is it that shipment between the southern Caribbean and the US is easier to arrange, than shipment between the northern Leeward and southern Windward islands, or so it seems? These are questions that the detailed Lewis planning approach incorporating planning for implementation, would help us to decipher.  These are questions that could occupy several Masters and PhD theses from this regional university.

3.      The critical role of capital investment (both foreign and domestic) in driving growth-enhancing structural transformation

Some have argued that the Lewis Model advocated what they, not Lewis, described as “industrialization by invitation” and that this led to an open-door approach which encouraged the further exploitation of former colonies by investors from developed countries.  Figueroa[5] counters, and I agree, that ‘the catch phrase “industrialization by invitation” which many people believe was Lewis’ description of his policy ideas, fails to accurately capture the comprehensive nature of Lewis’ proposals, the essence of which resided neither in the invitation of foreign capital to invest in the Caribbean nor with the implementation of industrialization.’[6]  He argued that Lewis saw collaboration with foreign investors as a ‘means to an end’ possibly via joint ventures and as a way of kick starting the capital formation that is critical to stimulating economic growth.  The engagement with foreign investors was a mutually beneficial arrangement which would assist in building technical capacity, generate productivity growth, encourage investment in non-traditional sectors as well as build a domestic entrepreneurial class while allowing foreign investors to earn an acceptable rate of return on invested capital.  In the meanwhile, countries would work towards increasing capacity to generate domestic savings as the foundation for building self-sufficiency.

Today, CARICOM States still are capital scarce economies that are disadvantaged by their inability to effectively mobilise domestic resources as well as limited institutional capacity to expand those resources. At the same time, the domestic private sector remains concentrated primarily in commerce and trading ventures. Attraction of foreign investment and external resource mobilization have long been major priorities of CARICOM States and have now become critical to the growth, development and resilience-building process. The CSME envisages the creation of a single investment space in the Community as a platform for attracting private investment, promoting innovation and foster the growth and competitiveness of CARICOM business enterprises. 

Along with the renewed emphasis on the revitalization of agri-food production, we may now have the opportunity to test the aspect of the Lewis Model which advocates the agricultural and industrial sectors as mutually reinforcing where “… neither can go … far unless the other is occurring.”[7] Perhaps, Lewis’ vision of the agricultural sector and the manufacturing/industrial sector in CARICOM States expanding side by side may now be realized. 

By now you know I am going to say that these are matters that require systematic independent research, and invite renewed study of, among other things, the investment preferences of the regional private sector; the scope for strengthening intersectoral linkages in support of investment in agriculture and agro-processing; whether there are limits to capital market development in the region, and what those limits may be. These are matters that bear continuous study and creation of knowledge to inform policymaking at the national and regional levels.

4.      Increase in domestic savings to finance investment (and by extension regional resource mobilization)

The Lewis Model emphasized the importance of a culture of thrift and the need to increase domestic savings in order to secure the domestic/regional capital to fund investments.  While the commercial banking sector in the region is relatively well-developed, the wider domestic capital markets are less so.  Additionally, a bank-centric culture dominates in the Community which leads to higher borrowing costs in circumstances where banks are not positioned to undertake the risks associated with large-scale, capital-intensive projects.  At the same time, there appears to be significant excess liquidity in the regional banking sector, therefore regional resource mobilization has been prioritized as a part of raising domestic capital.

For some years, a regional policy for the development and regulation of the regional securities market has been on the CSME agenda.  This policy advocates for the formulation of a common legal and regulatory framework for securities with a view to lowering transactions costs for cross-border investments in the Community. Building out the regional financial architecture to facilitate the efficient mobilization of regional capital to meet the demand for long term financing in Member States is now a priority for CARICOM.

A critical consideration in all of this, of course, is the impact of international financial regulatory requirements – those frequently updated financial sector oversight practices that lead to costly cycles of updating domestic laws and regulatory practices to meet new requirements, unilaterally imposed by various bilateral and multilateral regulators.  This reality has not only increased the cost and complexity of traditional financial operations, but it has slowed the impetus towards financial inclusion, as the basic requirements for opening and maintaining bank accounts are moving beyond ordinary persons, particularly small and micro businesses who are now even more blocked out of access to the formal banking system, driving more of them into informal financial arrangements with all the increased risks that are implied – from opening themselves to illegal activities to increased risks to personal security.   

These are matters that have engaged governments and regional financial regulators for the better part of the past 2 decades to no avail.  The protestations against the unfair unilateral impositions by a range of international regulators have been ignored, even as it is easy to demonstrate that (i) not all jurisdictions are required to submit to the same requirements and (ii) that by far the larger volumes of dirty money is laundered outside of our jurisdictions. 

In an increasingly inter-connected international financial space, it is critical that rules are implemented fairly and equitably so that the undesired consequence of greater marginalization of our financial systems – reduced capital flows to our region – does not continue to manifest.

But even as we address that, we have to go back to first principles and consider the critical importance of the Lewis emphasis on thrift, domestic savings and national/regional mobilization of those savings to fund investment within our region.  All these of course would benefit from ongoing contemplation, research and independent advice from the thinkers at UWI, some of which is happening and much more of which is needed.  The implication of undeveloped national financial markets at the same time that international capital markets are increasingly difficult to access, when access to capital is fundamental to the development of the regional private sector, is a riddle that begs solutions.

5.      The State as a Direct Participant in Economic Activity and as a Facilitator

State capacity is the ability of governments to conceive and successfully implement policy and, in the case of CARICOM States, also includes creating the conditions for competitive production and economic diversification.  The Lewis Model perceives the State as a facilitator of the transformation process but also emphasizes the importance of good governance and regulation. Indeed, we are reminded by Girvan that Lewis drew the conclusion that “…the longrun engine of growth is technological change, and that trade cannot substitute for this except in the initial period of laying development foundations.”[8] It is therefore important for States to undertake strategic and targeted interventions to raise productivity, especially through incorporation of appropriate technology, and to promote human development. 

The regulatory role of the State is particularly necessary as accelerated investments and developments in blue and green economy initiatives are pursued.  Also, ventures dependent on technology transfers require careful supervision to ensure that they are environmentally-friendly and in accord with long term sustainable development. There must also be a supporting parallel track of knowledge and capacity building, through science and technology at national and regional levels, to ensure responsible, efficient, evidence-based decision-making. 

However, aside from philosophical considerations on the role that the state should play in economic development, the capacity of the State to play a role is constrained by the narrow fiscal space arising from the economic context we discussed earlier.  This means that CARICOM governments, regional institutions and all involved in national and regional policymaking – or as Lewis would likely aver:  those involved in problem-solving – need to ensure that we use existing resources with the greatest degree of efficiency and thrift, in the Lewis sense.  Efficiency and thrift imply working together effectively to minimize duplication of effort, simplifying bureaucratic process that are intended to facilitate the provision of public services but result in limiting such access and focusing on critical priorities.  If ever there was a time when we need effective planning and implementation on the basis of clear and accessible data, it is now. There is neither time nor money to spare. 

One area in which our collaboration, coordination, planning and implementation as regional governments and institutions is essential to improving our chances of success, is in the advocacy for equity and fairness in accessing financial resources to address economic resilience and the impact of climate change – which we do not cause but bear the heaviest burden from.  We have to approach that challenge in an exercise of that joint sovereignty that we often speak of in hallowed tones.

Because the international financial institutions (IFIs) and bilateral partners base access to concessional financing on per capita income, and because the last revision to the income threshold (US$1,045 per capita), all CARICOM Member States (except for Haiti) will now be classified as middle- or high-income status and therefore do not qualify for concessional financing except where they may be classified as microstates and as such would have access to certain facilities.  The development of a multidimensional vulnerability index to determine the access by small states to concessional funding is being done within the region through collaborative work among regional and international institutions on the approach and composition of this index. But there is much to be done, not only to design a generally acceptable index, but also to do what appears to be even more difficult – to convince the major emitters that it is appropriate and just to expect them to underwrite the cost of the impact of their emissions over time.   The launch of the Resilience and Sustainability Trust by the International Monetary Fund appears to be a move the right direction, but several CARICOM States are still excluded from access given the income threshold criterion. 

I am pleased to acknowledge that these issues enjoy a fair degree of collaboration among regional institutions and among member states. There is no room for competition among us on these matters.  The scientists of UWI and 5Cs, the sustainable development specialists at the CARICOM Secretariat, CDB and the OECS, political leaders at the Ministerial Councils and the Heads of Government of CARICOM, are increasingly focused on making progress on these issues which are so crucial to our long-term survival.  But I am sure Lewis would encourage even more effective collaboration and coordinated programming of our work to ensure that all hands are on deck as we seek to shepherd these issues to acceptable outcomes in the global arena.

6.      Creation of a Highly Skilled Labour Force to Drive Productivity

Without a doubt, Lewis was firmly in the camp of those who identified the main resource of the Caribbean as its people.  The Lewis Model therefore established that the development of an educated and highly skilled workforce was key to growing the manufacturing sector as well as transitioning the agricultural sector to a high productivity growth driver.  Workers have to learn new skills and become sufficiently productive at new tasks in order to compete with workers in established industrial centres.[9]  The CARICOM Human Resource Development (HRD) 2030 Strategy is a long-term regional development policy framework which is primarily concerned with the creation of a globally competitive seamless HRD system. This strategy provides an overarching framework for the upskilling required for twenty-first century functioning citizens, to address the rising learning poverty rate and bridge the digital divide that became even more apparent with the pandemic.

The Community prioritized, some time ago, the development of the CARICOM Single ICT space as one of the key inputs to digital transformation, that is, the integration of digital technology into all aspects of social and economic interaction, therefore fundamentally changing how entities, sectors and governments operate and deliver value.  However, the pandemic exposed considerable vulnerabilities – in quality, reach and equity of access within communities and across the education and health sectors of our member states – This reality led to the firm and wide embrace of technology as a necessity.  It is no longer an option. It is a necessity.

A comprehensive strategy to move digital development from where we are to where we need to be, requires study, encouragement of innovation through appropriate public policy, scaling up of education delivery systems focusing on both teachers and students, planning and implementation of modern digital platforms and improved digital networks and the involvement of the private and public sectors in all of the above. Lewis would advise no less. If technological innovation is the major driver of productivity as in the Lewis Model, the pursuit of the digital transformation across the Community now requires a joined-up government approach to ensure that it is well-resourced and prioritized for delivery given that digital connectivity is now central to recovery and long-term sustainability.


As I come to the end of this lecture, I want to recall my second stint at UWI, Mona.  I had gone to the North to do an MA in economics at what I was told at the time was the equivalent of the Chicago School in Canada.  I did so because I wanted to understand more comprehensively, the basis for the approach to policymaking that the IFI’s were bringing to our countries. I did gain an understanding that led me to being even more convinced that the ‘social” part of the “social science” in Economics needed to be understood and incorporated in Economic policy-making in the region.  So, when I heard about the establishment of the Consortium Graduate School in Social Sciences, and spoke with my friends and colleagues about it, I did not think twice but became a student again.  We were told at the time that the major aim of the Consortium was to foster new kinds of thinking that would lead to new solutions to the problems of development in Caribbean society. When I got there, Donald Harris, Jamaican economist from Stanford University, was the director.  After he left, Norman Girvan, whom I was fortunate to count among my mentors, took over and led the way in emphasizing that even as we focused on our specializations, we must never forget that our analysis of problems of society whether as economists, or sociologists or political scientists must never allow us to so abstract away from the reality of the whole of society, of people as social beings and of socio-cultural norms that must be taken into account when formulating development policy.

That experiment that was the Consortium, amalgamated with the former ISER and became the Sir Arthur Lewis Institute of Social and Economic Studies [SALISES] which one of my Consortium colleagues, the indefatigable Aldrie Henry-Lee now leads. Others of my Consortium colleagues – notably Ian Boxill – are in the University community or in the regional and international institutions.

In the Lewis tradition, SALISES promotes research and publication across the range of social science, governance and related issues. That is good.  But I would want to suggest that it is time that the institute that bears his name focuses specifically on the intellectual contributions of Lewis.  I know that the institute collects and protects his works.  This is sometimes difficult given the humility of the man who insisted on understating his own significance. Girvan, who chronicled the scope and volume of Lewis’ scholarship, noted that at the time of his Nobel award, Lewis had (and I quote…) –

“… acknowledged publication of ‘ten books and about 80 other pieces (Lewis 1994: I) but a collection of his papers published in 1994 by SALISES, then ISER, runs into three massive volumes, each about three inches thick, with a total of 109 items whose wide subject matter bear record to the reach of his mind and his interests.  Thus, there are ten papers on industrial economics, twelve on world trade, eight on developing planning, twelve on dual economies and five on agricultural economics.  On the economics of particular regions in the developing world, we find seven on Africa, two on Asia, and five on the Caribbean.  Other categories reflect Sir Arthur’s engagement with the topical issues of the day or connected to his administrative work: there are six papers on the subject of race and economic development, six on education and three on politics, ….. (while) 25 items are placed into the category ‘other development issues’ and another eight into a category known as “various topics.”[10]

This lengthy quote illustrates that the complexity of the development problem requires a multi-dimensional solution platform as indicated by the breadth and depth of matters in which Lewis immersed himself.  SALISES, and other institutions in the region, do annual lectures in his honour. That is good. A few University professors and lecturers at UWI do research on various aspects of his work.  That is also good.  Not enough, but good.  But while international institutions like the World Bank in its 1999/2000 Development Report and more recently, UNCTAD in the 2021 Trade and Development Report, have reflected on the originality, relevance and salience of Lewis’ prescriptions, the Caribbean appears to have ignored the role of those prescriptions in the economic success of certain Asian economies, for example and more so, their applicability to our Caribbean economies.

I therefore would like to encourage the further study and interrogation specifically of Lewis’ ideas within the context of contemporary Caribbean societies via the establishment of a Chair here at the University of West Indies, to advance the multi-dimensional approach that Lewis brought to bear on his study of economic growth and development of small states like those comprising the Caribbean Community.  I do think it is high time. Quite deliberately, and in keeping with Lewis’ vision, the charter of the CDB – where Lewis was the first President – includes a provision to promote regional economic integration. It is my view that it would be fit and proper for CDB to memorialize its founding President and our Nobel Laureate in Economics by financing the Lewis Chair in Caribbean Development Economics at the University of the West Indies where Lewis was the first Vice-Chancellor. 

And with that exhortation, I rest my case.

I wish now only to thank SALISES Director Aldrie Henry-Lee for inviting me, Mark Figueroa for helping me to access some of Lewis’ work electronically at short notice, and to my own staff at the CARICOM Secretariat for helping me to do additional research to complete the task.

Thank you all very much.

25 April, 2022

[1] UNCTAD, (2021). Trade and Development Report 2021, From Recovery to Resilience: The Development Dimension.

[2] Girvan, Norman (2008). Op cit.

[3] UNCTAD (2021). Op cit

[4] Leon, Dr Hyginus “Gene” (2022).  Propelling Caribbean Regional Development: A Transformative Agenda, Caribbean Development Bank.

[5] Figueroa, Mark (2019). Towards an Accurate and Comprehensive Understanding of Lewis’s 1950s Prescriptions, Social and Economic Studies 68:1 (2019).

[6] Figueroa, Mark (2019). Op cit.

[7] Figueroa, Mark (2004): W. Arthur Lewis versus the Lewis Model: Agricultural or Industrial Development? The Manchester School Vol. 72, No. 6, December 2004

[8] Girvan, Norman (2008).  Op cit.

[9] Figueroa, Mark (2019).  Towards an Accurate ad Comprehensive Understanding of Lewis’ 1950s Caribbean Prescriptions, Social and Economic Studies 68:1 (2019).

[10] Girvan, Norman (2008). Op cit

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