Salutations
The CARICOM Secretariat wishes to thank the Caribbean Food Crops Society for the opportunity to discuss the challenges for the Caribbean Community in these early years of the 21st Century and onward.
Ambassador Irwin LaRocque regrets not being able to be here but as recently as a few days ago he was requested by our Secretary-General to proceed to London to participate in preparatory consultations and then to Geneva for the WTO negotiations. As I am sure you are aware, agriculture commodities – bananas, sugar, rice and possibly rum– are currently under increasing threats in the WTO negotiations so these meetings are urgent and important. So it falls to me to stand in for the Assistant Secretary -General on this occasion. This is perhaps just one indication of how much the Region’s Agenda is affected by external developments and almost all of the 21st century is still before us with all that is unpredictable. So I start with this first challenge.
Earlier presentations have covered :
- developments and responses relating to energy and food; and
- perspectives on achieving sustainable agriculture development which covered the problems and structure of our agriculture sector.
I expect a Vision for a new transformed Caribbean Agriculture or at least a new approach to suggest that we might not now be going in the right direction, at least in some aspects. Therefore, some of the challenges have already begun to be highlighted and so I will try to keep the potential overlap to a minimum.
The Twenty-First Century brings with it the REALITY CHECKS. To begin with, increased trade liberalization, loss of trade preferences in our traditional markets, graduation of our middle income countries which are also highly indebted from access to concessional resources and preferential arrangements, and this in circumstances where the vast majority of CARICOM Member States are not positioned to meet the challenges or exploit advantages but where the demands of our peoples are no less ambitious than they have ever been.
It was with the recognition and with the expectation that the global environment would be less accommodating and recognising that
- not only had we not been producing for the markets which we did have, including our own
- but also that our survival and the achievement of our goals would depend on increased and competitive production, particularly given our dependence on trade,
that the Community took the decision in 1989 to move to the CARICOM Single Market and Economy – the CSME – and the deepening and widening of the integration arrangements and by extension, our trading agreements.
Now, where is CARICOM aiming to go?
In 2007, CARICOM Heads of Government articulated the SINGLE DEVELOPMENT VISION for sustainable development which encompasses economic, social, environmental and governance dimensions and includes – and here I am being selective,
- Self-sustaining economic growth based on strong international competitiveness, innovation, productivity, and flexibility of resource use;
- A full-employment economy that provides a decent standard of living and quality of life for all citizens; elimination of poverty; and provision of adequate opportunities for young people, constituting an alternative to emigration;
- Spatially equitable economic growth within the Community, having regard to the high growth potential of Member States with relatively low per capita incomes and large resources of under-utilised land and labour;
As you note, these are ambitious and therefore challenging.
This VISION informs the further implementation of the CSME as an instrument
- for achieving, in a regional framework, certain development goals that are difficult or impossible to achieve individually by Member States: and
- for stimulating greater production efficiency and competitiveness, higher levels of domestic and foreign investment, increased employment, and growth of intra-regional trade and of extra-regional exports
How? Well, for example, in this context of the CSME, the VISION further identifies Agriculture – primary and processed and including Fisheries and Forestry – to be one of the main drivers of economic growth and transformation given its potential for:
- sustained growth of exports to international markets,
- significant growth in intra-regional exports,
- significant growth in supplies as a key input for other sectors thus providing important linkages
So there is the role identified for agriculture in the Region’s economic development. The challenge is to make it happen. In 2005, the VISION articulated for agriculture itself, is a sector that, no later than 2015:
- has made substantial progress towards contributing significantly to national and regional development and to economic, social and environmental sustainability;
- has a transparent regulatory framework at national and regional levels, that promotes and facilitates investment and attracts (direct and indirect) inflows; and
- has significantly transformed its processes and products and stimulated the innovative entrepreneurial capacity of Caribbean agricultural and rural communities
- has enabled the Region (as a whole) to achieve an acceptable level of food and nutrition security that is not easily disrupted by natural and or manmade disasters.
But having indicated all that’s expected of Agriculture, le us go back a little bit.
As we began the 21st Century, we in CARICOM were painfully aware that specific attention was required to be given to the agriculture sector if the Transformation Programme for Agriculture agreed in 1996 and now grounded in the 2001 Revised Treaty of Chaguaramas Establishing the Caribbean Community including the CARICOM Single Market and Economy were to get off the ground. Or rather be seen in the ground as agriculture should be.
The immediate challenges for agriculture were therefore to propel the transformation as envisaged in the mid 90s and to exploit the CSME arrangements being put in place to mitigate the negatives of being small vulnerable economies separated by water, open and lacking capacity in so many ways.
And to do this in a challenging global environment that was fast becoming less and less supportive of economies such as ours whether it was
- the more stringent and demanding liberalized trading arrangements like the WTO and the new EPA with reciprocal market access,
- the reduced funding possibilities from the IFIs
- inadequate global attention to climate change.
The more recent rising food, fuel and feed prices have only added to the urgency for action to ensure food and nutrition security.
TRADE
I am focusing on trade because of its importance to our economies – particularly, the global trade regime has created special challenges for the CARICOM Member States. The need for improved competitiveness through the transformation of existing production structures, for the increased application of technology as well as improved organisational arrangements has become a major preoccupation of policy makers in government and private sector as we expand our trading relations with third states
For the last decade and a half, the Community has sought to meet the economic and policy obligations of our multilateral trade agreements. Countries in the Community also relied on agreements which they thought were sacrosanct; where for example the EU Sugar Protocol stated that ‘the European Community undertakes for an indefinite period to purchase and import, at guaranteed prices, specific quantities of cane sugar…which originate in the ACP states…’. As it turns out, it was not sacrosanct.
Even as we are cognisant that economic development involves a transformation from traditional to modern and that international trade would tend to hasten this transformation, we are also even more cognisant that there is no guarantee of success. The economic challenges faced by CARICOM countries are serious enough to warrant grave concerns of rearranging the economic factors of production towards successful economic, social and sustainable transformation.
Diversification of the economies and the recombination of land, labour and capital in the Community is an obvious strategy for renewed growth and development.
In this respect, the Treaty of Chaguaramas lays the framework through the CSME for addressing and facilitating the efficient use of economic factors of production – land, labour and capital – across the borders in the Community. While some members of the Community have relatively large acreages of land, skilled labour is becoming scarce and capital is grossly insufficient and there are yet issues at national level of property rights, labour and capital flows which impact the emergence and growth of agricultural enterprises across the Community and the possibilities for the various forms of production integration.
But added to these challenges are the agricultural subsidies in the developed countries which threaten viability of farm enterprises in the Community and contribute to the cheaper imports which in itself have largely influenced the taste and preferences of the consumer away from more costly local and domestically produced goods. The end result has been a high import dependency on food and implications for policy for food and nutrition security. The challenge therefore is to change these tastes when the products in question are already in the market as a result of free trade agreements and commitments.
This situation is exacerbated by our now very open markets and the downward trend of agricultural investments in the sector.
New Thrust
Do we have a thrust that is new? When in 2005, Heads of Government agreed with the lead Head of Government for Agriculture that the immediate focus on agriculture should be addressing the key binding constraints to agriculture production and export, it is instructive to note that these constraints identified were almost the same as they were decades before. And I say ‘almost’ only just in case there might just have been shades of difference, not that I necessarily believe so.
So, how do we now get action which had been slow in previous attempts? How do we succeed in having Agriculture operate as a business to achieve the goals that have been agreed? The constraints must be addressed and entrepreneurial activity promoted through concerted regional action on the immediate priorities of:
- Attracting investment and financing into the sector
- Upgrading of facilities for intra-regional agricultural trade and transport and including:
- Strengthened regional collaboration in
- agriculture R&D particularly by cooperation among national R&D bodies and by the revitalisation of existing institutions with increased funding of regional bodies; and
- in SPS which mechanism is used not only to protect our human, animal and plant health but also to facilitate trade, particularly intra-regional trade in the context of seeking to ensure regional food and nutrition security;
- Market intelligence – sharing of information with respect to demand and supply for agricultural commodities
- Solving the transportation inadequacies which include the chicken and egg conundrum of not enough export production to attract transport and not enough transport to encourage and support production.
- Training and skills development
- Strengthening of Private Sector Organizations, as a medium to facilitate, develop and empower entrepreneurial capacity throughout the commodity value chain
CARICOM has given regional focus to the financing constraint with a Regional Donor Conference in June 2007 and then an Investment Forum in June 2008. But these initiatives will only be as good as governments are able to provide the enabling environment – physical and institutional infrastructure and incentives for attracting investment. Already the farming community is an aging one and there are issues like land tenure for small farmers.
Since policies must support linkages with other sectors and indeed linkages across the Region, investment ventures must be supported by the harmonisation of planning and financing policies across the Region. The Community needs to ensure policies for public investment for rural, marketing and agricultural health and food safety infrastructure, while specifically rewarding the private sector for the use of measures which ensure the safety of food from farm to fork.
There is then the added challenge of how to organise and prioritise the supporting investments in technology, research and marketing when all are needed simultaneously when resources are limited. How do we coordinate and manage the different stages and levels of the production and distribution chain?
THE COMMUNITY
Further, there are challenges to reaping the expected benefits envisaged for the agriculture sector in the Region that reflect challenges general to the Community as we tackle the transition to both completing the implementation of the Single Market and also taking advantage of those arrangements which move our perspectives from national to regional.
There are new issues of governance especially as the Region moves deeper into the CSME. So far, out of 12 small countries we have created a single economic space larger than any one Member State where goods, services, skilled CARICOM nationals, entrepreneurs establishing businesses and capital can move without restrictions. Operationally there are, not unexpectedly, still some hiccups in the new areas.
One of the challenges is to change the mindset which traditionally and emotionally is national, to seeing the entire Region as a source as well as a market.
Another challenge is the forging of a Single Economy by individual sovereign States and for the moment I leave it with you to consider all that that could and would involve.
The development of regional policies has begun with, for example proposals for a Regional Fisheries Policy and Regime which takes us past the traditional of access to each other’s goods and services and into considerations of sustainable access to natural resources which are the national assets of Member States and which can be depleted.
The role of governments in meeting the economic challenges in this century cannot be over-emphasised. The Community must be committed in ensuring policy coherence and implementation of such policies and measures necessary to bring about the required transformation. At the regional level, increased and increasing attention is being focused on agriculture. At the national level, this must also become evident in the support and allocation of increased funding for the agricultural sector while intensively pursuing external assistance for further development.
CONCLUSION
So what is the balance sheet with which we must work? In summary;
TO ACHIEVE: Transformation of Agriculture for competitive and profitable production and exports and for Food and Nutrition Security and Poverty Alleviation
STRATEGY: Complete the CSME and exploit the CSME and other free trade arrangements of which there are quite a few; Prioritise and focus on addressing key constraints so that results could actually be seen. The demonstration effect of expanded and competitive production of targeted commodities might hopefully feed on itself and encourage possibilities of further success for commodities that are already being identified for targeting;
CHALLENGE: Finding resources in circumstances where there are revenue losses from FTAs and also actual and potential market loss – national, regional and in Third Countries – following the loss of preferences and liberalisation; Developing the capacity for policy development and implementation and to prioritise focus; Forging regional policies by individual sovereign States.
For Agriculture, as long as Ministers of Agriculture, Ministers of Finance and Heads of Government provide the necessary support and issues of expertise, capacity and commitment are addressed, there is every reason for agriculture to be successful, that is, profitable and sustainable. This last will make the difference but is perhaps the greatest challenge.
I THANK YOU ALL
