Jamaica needs real development, not mere breathing space

Wignall's World

Mark Wignall

Sunday, December 23, 2012

Consider the confluence of 50 years of Independence, the first year of a new political administration, the Christmas season upon us and an IMF deal that keeps getting stuck either in political double-speak or in the country's inability to suck up any more debt.

If you do that, you have drawn a bead on Jamaica.

For the 50 years of our Independence we have had economic stops and starts, political experimentation which has impacted on the direction of the economy, fiscal saviours threatening to rescue us and economic savants telling us, after the fact, what we did wrong in the past and what we cannot do in the near and mid-term future.

The muddle has made us into non-believers and cynics of the first order.

We do not trust our politicians and if we should examine the shoulder bag we walk around with in which we keep the bad experiences, it will be littered with broken political promises, a country limping only on its 'potential', and a people whose attitude towards each other has made us into the puniest part of what we could be.

If a politician should tell us that the sky is blue and we gaze upwards and see the blue sky, we have a need to convince ourselves that our eyes are deceiving us.

We have been bitten so many times by the rabid dog of politics that long after we have freed ourselves of the froth and the pain of the sickness, we still retain the memory of the horrifying experience. Once a new political message is delivered, the pain is relived, even if there is no real infection. And, of course, there is always the question: Is there a new infection?

It is painfully obvious to me that if this country should add up all of its receipts in tourism, factor in the potential for niche products in that area, place bauxite exports on the list and then add to that all of the coffee, ginger, pimento, lemon grass, gully root, yams, bananas, rum, beer, reggae, St Thomas obeah and every other exotic thing we could sell to foreigners, Jamaica would still be in the economic mess that we are in.

Granted, if we could gain an uptick on local production of foodstuff back to the healthy 1960s level, there is the possibility that we would be able to feed ourselves, partially. Because of our cultural enslavement, we would still have a 'need' to import huge amounts of cornmeal, wheat flour, pickled animal parts, salted fish, frozen chicken parts and bland-tasting American fruits. In addition, we may find it difficult to live without fried chicken, burgers and pizzas.

If our foreign creditors should, overnight, cancel our debts, we would still be saddled with a huge bill for oil to power our electric grid and our thirst for driving fancy SUVs. There would be no guarantee that our tax compliance rate would increase exponentially (which is where it needs to go) or that our roads would be better maintained, police stations effectively manned, hospitals properly staffed and stocked with medication, schools in the hands of excellent teachers and a justice system that walks faster than a limp.

Over many years both the PNP and JLP have tinkered with development while they have messed up our minds and brought about a lifetime's cynicism. Their politics have given us guns, ammunition, bloodshed and loss of life. And at this time, this Christmas, this our 50th year of self-government, there has to be a demand for a better path, not just multiples of the few positives of the past but a radically different direction.

Is there such a direction? I believe there is, and I believe I have been given a glimpse into that glorious future. Will soon get to that.

How do we move from Cynicism to Hope?

Two items caught my eyes recently.

The first is from a youngster, a bright columnist in last Sunday's Observer, David Mullings, in his column headlined 'Moving the Needle'; and the other, a letter from a veteran political watcher, Ken Jones, December 14, titled 'No need to beg'.

In Jones's letter it is obvious that Eddie Seaga is his hero and he tries to make out a case of Seaga being a great conceptualiser and developer while a politician. To him, the PNP has not yet caught up with Seaga's past glory.

"The minister of industry has been asking foreign diplomats to help Jamaica realise the dream of a deep-water port to capitalise on the expansion of the Panama Canal. In doing so he appears not yet to have caught the vision of 'Jamaicanisation', a process that began nearly 50 years ago; and which opened up opportunities for Jamaicans to invest in their country profitably and so uplift the economy."

If one follows most of Jones's letters, it becomes obvious that he does not see eye-to-eye with the PNP's philosophy and most times his argument is well reasoned. This time, however, one suspects that Jones has not allowed his reasoning to catch up with what may be just an assumption of what he imagines is a continuation of the PNP's past anti-business philosophy.

His letter also states, "Successive governments have found it difficult to think big, as Seaga did and still does. They demonstrate such little faith in their own capabilities and that of the resourceful people of Jamaica. They have become so accustomed to begging and borrowing that it has become a nasty habit that shames us and makes nonsense of the claim to Independence."

Mr Mullings, in his column says, "The Panama Canal is widening and Jamaica is perfectly placed to be an even bigger transshipment hub for the Western Hemisphere, leveraging the seventh largest natural harbour in the world, but we will most likely be late to the party because no one is willing to make the big decisions in a timely manner.

"If we were playing a football match our team would be losing, not because we were not good enough but simply because we weren't trying to score until the closing minutes of the game, while the other team was trying since the first whistle blew.

"Critical decisions will have to be made in 2013 that affect the future trajectory of Jamaica, the economy and the citizens. It is high time for us to make bold decisions that will move the needle and implement plans with a sense of urgency so that Jamaica can really advance in this second 50 years."

A reading of both items indicate the usual cynicism, the type that has infected me for many years. The million-dollar question is, could they both be dead wrong?

Well, I believe they are, but I entirely understand the reasons for it. As I stated before, after spending many long seasons being singed in the hot fires of fiery but empty political promises, one is entitled to wear the badge of cynicism with some honour.

It is highly unlikely that crude oil will begin to gush out of the plains of Trench Town or the gentle slopes of Cherry Gardens anytime soon. No miner in the hills of Clarendon is preparing to announce that thick, rich veins of 24 carat gold have been found in "them there hills". Beneath our abundant limestone crust there is no excess of titanium, neither are there tons upon tons of copper ore beneath the earth in Tivoli Gardens.

The one and only way available to Jamaica in terms of reaching that lofty goal inherent in Vision 2030 is that move that directly integrates Jamaica and all of its processes into the global supply chain.

What is the global supply chain?

Jamaica does not produce digital cameras, 3D TVs, microprocessors, jet engines or even condoms. We produce babies who have no fathers, but we have no large international auto plants operating in the country.

Jamaica sits at the centre of the Americas and although that was what gave birth to our transshipment port, over many years we have not exploited that geographical gift of nature.

The mantra 'global supply chain' was drilled into me as a participant in the Caribbean Online Forum. People like Trevor Campbell, Reginald Nugent and David Wong were consistently preaching that if the approaches of Jamaica's business elites remained stuck in the past, they were likely to become fossilised in their bottom lines.

Others like Professor Winston Davidson fully understood that if Jamaica wanted to rescue itself from the yoke of 50 years of pandering to puny levels of development, in the 21st century, nothing but a direct link into the global supply chain would make that gargantuan leap to redeem Jamaica for the next 50 to 100 years.

Outside of our homegrown business icons like 'Butch' Stewart of the Sandals Group, elements of GraceKennedy's manufacturing and distributive arm, and a significant part of Wisnyco's business model, businessmen in Jamaica have mostly seen themselves as large fish in a small pond — Jamaica — and, as long as they personally do well, are always lauded in the media and can boast that they employ 100 or so people, they seem satisfied to be among the big boys at the fish fry.

The world is changing and they had better. What better way for them than to be pushed into it?

Sugar will not help us and I am certain that the Chinese know this. At some stage the insurance industry will decide that bananas are not worth it either. So, what is the path?

The logistics hub

For some time now I have been pushing the idea of a dry dock as originally proposed by Dr Lloyd Cole in 1990.

Last week, I met with Minister Anthony Hylton (Industry, Investment and Commerce); Dr Eric Deans, director of shipping, policy and research at the Maritime Authority of Jamaica; and Professor Winston Davidson, chairman of the Technical Review Team of the PNP's Progressive Agenda.

In a three-hour meeting, a slide presentation of the proposed logistics hub was shown and fully explained to me. At the end of it I was convinced that at last Jamaica is about to embark on not just a project but a pathway that will totally transform this country.

At its simplest, and there is nothing simple about a logistics hub, think of a bicycle wheel with the radial spokes. Jamaica is at the centre while the spokes point outwards in all directions, to the growing South American (especially Brazil) market, across the Atlantic to the Western European cities, into the Gulf states and northerly towards the lucrative South and North Atlantic American market.

The scope of the logistics hub will include but not be limited to rehabilitation of existing infrastructure and development of new infrastructure, warehousing, bulk storage facilities, primary processing and packaging zones including connecting road, rail, air, and digital communications infrastructure and associated facilities in Kingston and in other locations throughout Jamaica.

Presently there are three main logistics hubs — Singapore, which controls the Asian market space; Dubai, which deals with the Far East space; and Rotterdam, which is at the centre of the European market.

The logistics hub initiative represents the next exciting and radical stage in the evolution of Jamaica's airports, seaports and industrial infrastructure to position the island as a major node in the global supply chain.

The project involves enhancements to existing infrastructure and new projects such as commodity ports, cargo airports, a dry dock at Jackson Bay as championed by Dr Cole, and special economic zones.

A commodity port is to be built in eastern Jamaica, most likely Cow Bay, and it will provide crude oil and petroleum product tankage together with blending. The natural deep-water loading — in excess of 50 metres — should be able to provide discharging and transshipment capabilities. Think of that — a guarantee of uninterrupted supplies of crude oil, gas and refined products to the global market.

Other terminals such as at Port Esquivel will cater to bulk minerals, grain and other commodities.

Singapore is saturated; Jamaica is ready

Singapore would love to have what we have — land space — and we are now attempting to attain what that fantastic country has gained.

Containerised cargo — the type we see on our TV screens at Port Bustamante — accounts for only 15 per cent of global freight. The rest is bulk carriage, mostly commodities, like oil, grain, ore, liquefied gas, etc. The hub in Singapore has everything else, economic zones like the one planned for the Caymanas Economic Zone (CEZ), dry dock facilities, transshipment of containerised cargo, but it cannot handle the huge vessels carrying commodities like oil and ore.

According to Minister Hylton, he has chosen to do the hard work on the ground rather than pandering to photo ops and press releases every week. He has taken teams to Singapore and Rotterdam and, as he states it, "Although we knew what our ultimate objectives were, without these trips, we would never really get the insight that we needed."

At one stage of the presentation the minister said, "While we were with some rather eager, potential investors, laying out the hub to them, one placed his hands at his chin and paused for about 20 seconds. Then he said, 'You want to give me Jamaica and you take Singapore.'"

For about the same time, 20 seconds, it was lost on me, then I said, "Oh s..., you mean he sees Jamaica becoming a bigger place economically than Singapore!"

"Ah, you've got it," said Minister Hylton.

"Listen, Mark," said Dr Eric Deans, "If we did not mention the B word to them, that is billions, they would not be interested. These are not petty players, but real global players with serious cash."

The minister chimed in: "There is a misconception that Jamaicans have no money. There are Jamaicans in the diaspora that are flush with funds. We have made contacts in parts of the diaspora in an attempt to attract them to the various parts of the investment package.

Said Professor Winston Davidson: "As you can see from the charts, what we are doing is a sequential planning — going after the low-hanging fruit first because as you can see in a huge plan like this, one can never wait until all the ducks are lined up. In some of the projects we have reached to the point of seeking RFPs (requests for proposals). Others are purely private, but we are marshalling the entire development. Mark, this is something we conceptualised over three years ago and placed as part of our Progressive Agenda. Now, the plans are coming to fruition."

The minister added: "I see where you have been singing the praises of a certain minister and I have absolutely no problem with that. What I would like you to appreciate, though, is that with certain plans, one cannot just go off talking and talking. One has to lay the groundwork first."

I said: "I can appreciate that, minister, but what must the public think? If the people cannot get action, they want words and..."

He interjected: "I see that, but one has to make a trade-off. For me it's little talk, more action, even if it has to be behind the scenes. Once the plans begin to gel, then we can begin the talk."

I am totally convinced that this is Jamaica's only way out of the quagmire of economic depression. Additionally, the PNP has its immediate future riding on this development. There is more and there is a timeline.

I will give you more at another time. For now, have a very merry Christmas. Exciting times are ahead.





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