Caribbean countries are still struggling to recover and return to growth after the global economic recession and the pivotal role of the private sector in that process was highlighted on Tuesday, the first day of the Caribbean Exporters’ Colloquium at the Hilton Barbados Resort. Hosted by the Caribbean Export Development Agency (Caribbean Export) in collaboration with GIZ and the European Union, the two-day event focused on the Caribbean’s export performance in light of developments at the global level.
Caribbean Export executive director, Pamela Coke-Hamilton, who highlighted the need for export diversification, said there was a major role for the region’s private sector in building the economic resilience needed to cope with external shocks. “There is an urgent need to support the private sector and strengthen their capacity to export,” she told government officials and representatives from Caricom and Cariforum states at the high level discussions.
Coke-Hamilton said there was need for alternative ways of contributing to GDP and small and medium enterprises (SMEs) must be more innovative. She said one of the biggest challenges was access to finance as banks in the region are often hampered in their efforts to support SMEs. Noting that 70 per cent of the Caribbean’s GDP comes from the services sector with tourism as the biggest industry in that sector, Coke-Hamilton called for a shift in marketing. She said: “We continue to sell tourism as we did 50 years ago. The world has shifted and we need to adjust our tourism product to address that shift.”
Coke-Hamilton assigned grades ranging from a B- to an F in giving the report card on various areas of export-related performance in the region at the Caribbean Exporters’ Colloquium 2014 being held in Bridgetown, Barbados, under the theme “Building Economic Resilience in the Caribbean”. Speaking during the event’s first session entitled “Making the Grade: An Examination of the Region’s Export Performance”, she said the region earned a B- grade for overall economic performance with economic growth offset by high fiscal and external debt.
Economic growth for the region is projected at 2.5 per cent for 2014, down from three per cent in 2013, Coke-Hamilton said. Regional GDP for the area was US$132 billion, with the Dominican Republic having the largest share, followed by Trinidad and Tobago, Jamaica and Barbados. Total exports for the region is US$51 billion, with services representing 62 per cent. Other grades included a B- for conformity to international standards and a sub-par D grade for innovation.
Export diversification is another concern. “We still rely on what we did 50 years ago, and we have to get beyond that,” Coke-Hamilton said. The role of the private sector in the region’s economic development earned a C grade. Branding and intellectual property rights, as well as access to finance, performed less well, both earning C- grades. “Our banks tend not to ascribe value to an idea,” Coke-Hamilton said, with businesses needing to look at non-traditional providers for capital and investment. For global logistics and shipping, the region performed at a satisfactory level with a grade of C+ with easy accessibility from the region to locations like Miami, New York and London.
But the worst performing area was for intra-regional logistics and shipping, which received a failing grade of F. “If we don’t address it, everything else becomes, frankly, theoretical,” Coke-Hamilton said. But despite the mediocre report card, the region may have a brighter future, according to panellist Ashish Shah, director of the division of country programmes at the International Trade Centre. “I stand convinced that the turning point has come,” Shah said. “The report card is a very good C in my view,” and could soon improve to a B+, Shah said. “To succeed in trade you have to be able to compete and be able to out compete your competitors,” Shah said. The focus on small and medium businesses (SMBs) is most important,” he continued.
Professor Victor Bulmer Thomas, honorary professor at University College, London and professor emeritus of London University noted the danger of looking at region-wide statistics, as they are heavily influenced by the performance of one country. “Everything is about Trinidad and Tobago,” Bulmer-Thomas said. Bulmer-Thomas analysed 27 individual territories in the region by looking at their individual economic performance. Using his analysis, the top-rated country for the region was Cuba which received a top score of 5, followed by Haiti at 4.
Cuba benefitted from having access to all sorts of special arrangements, Thomas said. e said one example was that the country gets Chinese tourists “in numbers that other countries can only dream of”. The export-led growth message had been received “loud and clear,” across the region, Bulmer Thomas said. But there has to be a “much greater effort” put into the measurement or metrics.