Hamilton: Creative industries an afterthought

Pamela Coke-Hamilton, Executive Director, Caribbean Export Development Agency, maintains that even though one of the new trends we are seeing in the services industry is the creative industries, one of the major problems is that they are seen as an afterthought.

Speaking to the media last week at the Radisson Aquatica Resort, she explained, “One of the major problems we found is that the creative agencies continue to be treated as an afterthought by many of our policy makers and political heads. We don’t think about it as a policy objective, we think about it as something that comes naturally, and because of that, we have not really had an overarching policy dynamic that governs the way we engage the creative industries.

“Therefore, one of the things we will be looking at doing is looking at the export value of our music, the issue of intellectual property, and the values that come through intellectual property and branding, which has not really occurred in our region.

“We talk about it in generic terms, we use anecdotal evidence, but we don’t have the numbers and data that drives our policy imperative, and that will be critical moving forward.”

In the short-term, we are seeing developments: “The Barbados Cultural Industries Bill; Trinidad has created a creative centre, where they have merged all of their organisations that deal with the creative industries; Jamaica has also been working on their creative industries...

“Therefore, what they are trying to do is put in place the policy and regulatory framework to begin to engage in a more strategic manner the creative industries. Also, linking sectors together is a major drive. For example, we are doing a major thrust on CALABASH, which is a literary forum, but we will link art and literature.”

Barbados Minister of Foreign Affairs & Trade, Senator the Hon. Maxine P.O McClean, outlined, “In Barbados, we want to ensure we have the regulatory framework to facilitate entrepreneurs. We are talking about moving from operating in a domestic place to competing in the European Union.

“In Barbados, we had EPA implementation units that would be engaging in workshops aimed to discuss opportunities to provide technical assistance etc.

“It is about our business persons feeling comfortable to pursue these opportunities. It takes time, because you are talking about competing in a different competitive space, and, however, we are seeing a number of persons taking advantage.”

Economic branding

Mikael Barfod, Head of European Union Delegation to Barbados and the Eastern Caribbean States, believes “linking creative industries and economic branding is extremely important, and enormous benefits can be reaped from that”.

“I do believe that the EPA is beginning to take off and it is making progress, but it is a long-term process; it is not just something you can measure in terms of market access to the European Union. It is very much about regional integration, regional liberalisation, and within the service sectors, we the private sector to take advantage of the new facilities.” (NB)

‘Finding right energy mix crucial’

Minister of State in the United Kingdom’s Foreign and Commonwealth Office, Mark Simmonds, MP, says that in order to tackle the grave threat posed by climate change, and to overcome rising fuel prices and the dwindling supplies of fossil fuel, all nations need to develop a wide mix of renewable and sustainable energy sources.

In a message sent to the Marine Environment seminar held earlier last week at the Courtyard Marriott in Barbados, he stressed the need to collaborate through sharing knowledge, expertise and best practice to find ‘green’ energy solutions.

Project Manager for the CARICOM Energy Programme,
Joseph Williams, as he spoke on the need
for a more aggressive energy policy.

Several of the participants at the energy seminar.

“This is not a problem that a single nation can solve alone and seminars like this are an excellent way to bring together international experts: manufacturers, project managers, governments and financiers – to discuss every stage of the process and to see which energy sources would work for you,” he outlined.

Highlighting that island states would be the first to feel the impact of rising sea levels, he urged those in attendance to embrace “the cutting-edge British technology and scientific expertise that can be used to harness the abundant energy of the sun, wind and water, and protect our fragile marine environment and the many thousands of lives and livelihoods which depend on them”.

Programme Manager of CARICOM’s Energy Department, Joseph Williams, emphasised that a more aggressive regional energy policy was necessary, citing that there has been some criticism from several quarters about the approach.

He stated that the policy reflected a compromise between the 15 member states, which have different comparative advantages in different areas in terms of resources.

“One has to look at it through that lens. We are looking at a process that has lasted for more than ten years, so that gives you an idea of the kind of challenges we have at arriving at a regional energy policy. I think it is important for us in terms of sending clear signals to ourselves in terms of where we need to go and also to set priorities,” he outlined. (JMB)

Technology, Davos and the Caribbean

Each year since 1971 the powerful and influential of the world, the global super elite, have met in Davos in Switzerland to discuss the challenges facing the world economy.

This year’s World Economic Forum focussed on the ways in which ‘networked hierarchies and technological forces’ were transforming our lives, communities and institutions, at a time when the international community remained focussed on crisis rather than strategically driven responses.

Many of the issues considered in the alpine resort suggest we are heading towards a world for which the Caribbean, because of its smallness and peripheral nature, is not only unprepared, but is so far behind, that it will, before long, need remarkable new forms of leadership and vision to respond to.

Much of the discussion revolved around rapid technological advance, change and the likely consequence that global economic recovery will favour the few rather than the majority.

Put another way, the suggestion was that we are entering a world in which future growth is likely to benefit fewer and fewer people and that the opportunity to be modestly prosperous is moving away not just from the world’s poor and working class, but increasingly from the middle class whose capacity to benefit and participation in wealth creation has previously been widely accepted as cementing stability in market economies.

The event was for and about a privileged group of individuals, remote and secure from everyday life, speaking about a future from which most had managed to exempt themselves financially, and in some cases morally. However, it provided a warning of the social inequality and instability likely to result in the next decade as the concentration of capital in a few hands, and rapid change in relation to new technology will alter forever the structure of world in which we live.

Of these the most challenging issues considered is what is sometimes described as the coming of a new machine age. This starts from the premise that computing power is growing exponentially and that as machines come to replace and multiply our intelligence, they will begin to replace not just mechanical tasks but many of the knowledge based forms of the employment that we undertake as well. The suggestion is that we are on the edge of a new and profound industrial revolution of automation that may put millions out of work in everything from building and fishing through to working in call centres.

The suggestion is that as these and other radical changes take place in the structure of the world economy, as corporate tax avoidance grows, and unproductive capital is concentrated in the hands of a few globally, the nature of the relationship between the governed and the state will alter. Then elites, in the form of those well represented in Davos in January, will act in ways that take them into the space of governance raising questions about democracy that few presently have answers for; other than to look back to the old politics of class, party and the now centuries old lines of thought that economic globalisation has bypassed.


Speaking in Davos about the social dimension of present change, Christine Lagarde, the Managing Director of the International Monetary Fund, highlighted the threat that growing income inequality posed if the benefits of growth were enjoyed by far too few people. It was not a recipe for stability and sustainability, she said in an interview with the Financial Times.

In this context, a contribution made by Pope Francis to the gathering was sobering, suggesting that those present should reflect on the causes of the economic crisis, and help build a new economic order where wealth serves the people not the other way round. In an address read to the gathering, he said that while there was a need to recognise the fundamental role that modern business activity has had in improving social welfare and reducing poverty, it has often led to widespread social exclusion and insecurity. “What is needed, then, is a renewed, profound and broadened sense of responsibility on the part of all”. This, he said, “calls for decisions, mechanisms and processes directed to a better distribution of wealth, the creation of sources of employment and an integral promotion of the poor which goes beyond a simple welfare mentality”.

The comments come as it is clear that faith in government has fallen worldwide to the lowest levels ever. An annual survey produced by the global public relations group Edelman, showed that only 39 per cent of those surveyed had confidence in government, with the suggestion that if not addressed, it could herald a rise in populist political activity.

If evidence were needed it is not far away. In Brazil a new form of social protest has emerged, a phenomena known as ‘rolezinho’, a type of flash mob involving sometimes thousands of young people organised through social media descending on upscale locations such as shopping malls to demonstrate against everything from increases in bus fares to social and racial inequality.

These developments and the fact that they are now being debated at the highest levels by those with the most to lose, should there be negative social implications, indicate that they cannot be ignored.

They suggest that the region and individual nations in the Caribbean ought to brutally assess where they might have advantage in a changed world, accept their structural and other limitations, and set about gradually and pragmatically adapting their economic and political systems on the basis of national consensus, rather than complaining that what exists is the fault of others.

Space does not permit a discussion of what this might practically mean, but in essence it suggests the need for economic rebalancing, moving the region up-scale into niche markets whether it is in manufacturing or tourism, constantly developing and managing reputation and brand, and providing better, transparent and inclusive governance. Above all, it requires a huge long term investment in education and the recognition that unless academic institutions are business oriented, world class, and prepared to compete internationally, governments wanting change will have to find ways to encourage the educational establishments of others to locate in the region.

It also suggests that young people, aspiring politicians , tomorrow’s business leaders, church men and women and every citizen needs to think very differently about the future and the issues they will have to address if the Caribbean is ever to reach the promised land.

(David Jessop is the Director of the Caribbean Council and can be contacted at david.jessop@caribbean-council.org. Previous columns can be found at www. caribbean-council.org)

Burdensome debt and elusive solutions

The debt of small Caribbean states has been unsustainable for some time now and, unless it is tackled effectively, it will further retard their economic growth and the quality of their human development.

Average public debt levels for Caribbean small states now amount to about 84 per cent of GDP with five countries experiencing debt-to-GDP ratios of close to 100 per cent and higher. These countries are: Jamaica, St Kitts-Nevis, Grenada, Barbados and Antigua and Barbuda.

Models produced by experts find that as the debt levels in Caribbean countries reach 30 per cent of GDP the effects on economic growth are positive, however once the levels reach 55 per cent of GDP, the impact of debt on the rate of economic growth becomes negative. This has become obvious in those Caribbean countries where debt levels are over 80 per cent. There is either no economic growth or such minimalist growth as to be of no good effect.

In 2011, the Eminent Persons Group (EPG) of which I was a member highlighted this problem to then 54-member Commonwealth of Nations whose Heads of Government had commissioned us to advise on reform of the Commonwealth.

Observing that the debt problem in small states was already serious before our report, we said: “The situation is worse now. Unemployment and poverty have risen in many of them with attendant increases in social dislocation and crime”. We called on governments to take advantage of the Commonwealth’s Debt Recording and Management System software to improve their debt management. At the time of writing, I am unsure how many Caribbean small states did take advantage of the software. What is known is that many of them increased their debt substantially since that report.

It is also known that high debt has had an adverse effect on human development in small states. The United Nations Human Development Index (HDI) shows that since 2005, “human development growth slowed tremendously and slowed further since 2008, reaching the lowest growth rate of HDI in small states to date”.

Some small states have also relied heavily on borrowing from their domestic banks and national insurance authorities. This is a worrying problem, for should governments either not repay the debt in full or impose write-offs, there would be a negative impact on the domestic financial system, and on the domestic community.

A major difficulty that Caribbean Community (CARICOM) small states face in the international system is that since the 1990s, all of them (with the exception of Haiti) have been “graduated” to middle income status and, therefore, have very limited access to concessional borrowing. Consequently, when they have borrowed (sometimes injudiciously) they have had to rely on commercial instruments, particularly bonds, thus increasing their indebtedness and, in a few cases, making them not creditworthy. Getting debt “write-offs” is virtually impossible and even re-structuring is extremely difficult.

Apart from the Caribbean Development Bank (CDB) which is carrying significant public sector debt for Barbados and the smaller islands (and which cannot be written-off), much of the debt now owed by Caribbean small states resides in commercial debt, loans from China and credit extended under the Venezuelan Petro Caribe oil arrangements.

Commercial debt can be negotiated under the so-called “Paris Club” arrangement which offers no upfront debt reduction but could extend debt maturities. The “Club” hardly ever agrees to lower interest rates. Caribbean countries that have gone this route have achieved nothing more than an extension of the payment period.

With regard to China, its loans have been concessional and have eased severe problems for many Caribbean small states. The region received a US$530 million economic assistance package over a three-year period ending in 2010, the main benefits of which were highly concessional terms. Additionally, the aid packages are sizeable, in contrast to development aid from the multilateral financial institutions. But, the loans have added enormously to the debt of small states. Additionally, while some governments may be hopeful of it, there is no indication that China will write-off loans or be benevolent in the event of a payment default; nor is there any indication of the terms that would be demanded to restructure debt. A further concern is that the debt is swelling because it is denominated in Yuans the value of which is rising against the US dollar to which many Caribbean currencies are pegged.

On the Petro Caribe Fund, while this has helped to cushion current account balances from oil, the loans have grown enormously. These loans too have to be repaid and while Venezuela has been generous so far, its own financial constraints suggest that there will be no write-off of these debts.

A huge problem faced by all Caribbean small states (including those of greater size) is the lack of capacity to negotiate effectively with bigger countries and agencies. Too often political decisions are taken without adequate technical preparation and experience. And, not even a group of these small countries has chosen to band together to negotiate collectively. Consequently, the outcomes are disadvantageous.

The Commonwealth Secretariat cannot encourage debt management in member countries that do not seek it, but with the agreement of governments it can provide help to those who request it. It has provided experts to help restructure commercial debts for some countries, and recently its Economic Affairs Division has done expert technical work to put the issue of small states debt before the G20 and International Financial Institutions (IFIs).

The options proposed by the Secretariat to the G20 and the IFIs, in an effort to stimulate ideas for remedying small states’ challenges, include: debt for climate change swaps as a way of resolving debt burdens while simultaneously fast-starting financing for climate change; adding a vulnerability consideration to the criteria for determining eligibility for concessional financing; and replacing adjustment programmes with resilience building as the main conditionality for lending to small states.

So far, there has not been much traction on these initiatives, and in the current international economic climate, there is unlikely to be such traction unless there is significant fiscal adjustment by governments to improve their finances and reduce debt while stimulating stronger economic growth. However, achieving a balance between austerity and growth is a major challenge for the governments of small states requiring innovative policies and prudent management that have so far thwarted many of them.
Meanwhile, heavy debt encumbers many Caribbean countries and impairs their development.

(Sir Ronald Sanders is a Consultant, Senior Research Fellow at London University and former Caribbean diplomat Responses and previous commentaries: www.sirronaldsanders.com)

Worthwhile approach

IT was noted quite recently that Public-Private Partnerships (PPPs) in the Caribbean hold the key to the success of infrastructural development in the Bank’s Borrowing Member Countries.

There is a recognition that infrastructure development represents one aspect, and a key one at that, to boost the social and economic development in the small island states of the Caribbean.

Towards the end of last month the Barbados-based Caribbean Development Bank (CDB) and the International Finance Corporation (IFC) signed a Memorandum of Understanding (MOU) to support the infrastructural development in the Bank’s member countries.

The MOU between the CDB and the IFC, which is an agency of the World Bank, is aimed at advising governments on new projects with private sector participation, among other things.

It is instructive to note that these arrangements have taken root in a number of countries outside the Caribbean as governments look for ways to reduce spending and to have partners in the area of economic development.

Furthermore, they are very useful when it is considered that governments that previously had taken on the business of building up their country’s infrastructure are hard pressed to find resources to do so.

In a nutshell, the governments have budgetary problems and are unable to proceed as was the case some years ago in meeting the demands to transforming their economies. Looking across the Caribbean, some governments are finding it difficult trying to balance their budgets, whereas in some other instances there are those  which have been cutting back their spending to improve their fiscal position. We expect a more detailed picture of these situations when the CDB hosts its review of regional economies this week.

Faced therefore with pressing economic issues, the PPPs therefore offer governments the opportunity to tackle certain issues with the involvement of the private sector.

Improved infrastructure allows for better roads which improve access and efficiencies; the building of schools and other institutions of learning to broaden opportunities for training at the primary, secondary and tertiary levels; office buildings that allow for better performance of employees; health care facilities; sewerage systems and the list goes on and on.

In the case where Government is involved in key areas of the economy, they are usually called upon to finance and build hotels.

The long and short of these undertakings is that by indulging in Public-Private Partnerships, the private sector uses some of its resources to outfit the projects and at a later stage they are reimbursed.

From this vantage point we think the initiatives being promoted by the CDB and the IFC are worth the while. They must be encouraged wherever necessary since the region is still battling a volatile economic crisis, and has to look for new ways of doing business and to find new avenues for growth. PPPs also allow for better management of projects, while reducing the likelihood of costs overruns which have been a nightmare for governments.

Honour for first PM

By Linda Straker

IN addition to the title of “Father of Independence”, Prime Minister Dr. Keith Mitchell announced that Sir Eric Matthew Gairy will be honoured with new initiatives in celebration of Grenada’s 40th Independence.

“In expression of gratitude for his life’s work and vision, Government has taken the decision to – among other recognitions yet to be unveiled – to rename the Tanteen Roundabout and the Botanical Gardens after Sir Eric Matthew Gairy,” Prime Minister Mitchell said when he delivered his speech at a 40th Independence rally last Friday.

Sir Eric was the Prime Minister who had the idea to build roundabouts at crossroads as a means of encouraging a smooth flow of traffic in the absence of traffic lights.

“Today, the result of Sir Eric’s bold Independence experiment is visible, and is mirrored in the academic, sporting, and professional exploits of our people, and in the building and sustaining of this democracy through 40 years,” Dr. Mitchell said, as he spoke about the many initiatives undertaken by the then Prime Minister despite, according to history, facing strong resistance from opposition political parties.

Besides the renaming of the Tanteen Roundabout and the Botanical Gardens, a stamp was unveiled to remember Sir Eric and went on sale as of February 10, 2014. This is the first former Prime Minister to have his photo placed on a stamp.

PM Mitchell told thousands attending the rally that after 40 years, it is time for Grenadians to wean themselves off some of the remaining vestiges of colonialism – and so this is a fitting year for constitutional reform.

“Yes, fellow citizens, the time is right for us to have our home-grown Constitution. Let us seize the moment as we prepare for a referendum on our new Constitution later this year,” he said, as he called for citizens to support the initiative to redefine national identity within a more suitable framework for long-term development.

Earlier in the year, Government established a National Advisory Committee on Constitution Reform and that committee is spearheading public consultations on the matter. Grenada is a former colony of Great Britain, which became a sovereign state on February 7, 1974.

Agriculture is ours!

A CONCERTED effort must be made to change the image of farming and agriculture.

Word of this from Principal and Pro-Vice-Chancellor of the UWI Cave Hill Campus, Professor Sir Hilary Beckles, who says there is a dislike for agriculture among a significant part of the population because of the history of labour degradation associated with slavery.

From left: Principal and Pro-Vice-Chancellor of the UWI Cave
Hill Campus, Professor Sir Hilary Beckles; Merina Jessamy,
Permanent Secretary in the Grenada Ministry of Agricultural
Lands, Fisheries and Environment; and Minister of Agriculture,
Fisheries and Forestry of Dominica, Matthew Walter, after the
signing of a MOU in support of the Centre for Food Security
and Entrepreneurship, an initiative of the Cave Hill campus.

“We know there is a lot of education that should go into that to turn that around. Because you should not, in fact, turn your back on what is yours because you had a bad experience with it.”

He was speaking during a Regional Conference on Cassava in the Caribbean and Latin America and Launch of the Centre for Food Security and Entrepreneurship at the 3Ws Pavilion, where he made the point that the black people in the Caribbean were brought from Africa because they were good at agriculture.

“It wasn’t simply because they were units of labour; they had a long tradition of high-yield agriculture. So we have a population base that has a historic connection to high quality agriculture, yet we lament the relationships of the employment, but agriculture is ours.”

Sir Hilary stated that one role that the university has to play is to help to change the image of agriculture.

“You do not throw out the baby with the bathwater. We have to stay with our agriculture, our ancestral legacy. We modernise it, we apply all of the appropriate technologies to it as we have always done. We need in this university to produce graduates who are looking for career opportunities in agriculture. There are spaces available.”

He said the Faculty of Science and Technology is committed to developing an educational approach to agriculture that would make it attractive to a new generation of young people coming out of school with a different view of agriculture.

The principal explained that the development of a Centre for Food Security and Entrepreneurship is intended to develop a research centre of teaching and learning that would bridge academia with agribusiness and to participate as a university in the entrepreneurial aspect of that development.

He used the opportunity to express gratitude to the Edghill family, who has made 30 acres of prime agricultural land available to the Cave Hill Campus for the facility. “The philanthropy of the Edghill family is outstanding,” he said. (JH)