Far from sweet

Imran Khan, CEO of KCC, blamed the shortage on the management strategies of the Sugar Manufacturing Company, which was set up by Government to continue sugarcane production when Caroni (1975) Limited was closed in 2003. In that year, understandably, sugar production went down by one-third. But matters didn’t improve in 2004. The sugar crop started late, industrial action led to closure of the factory, there were mechanical problems and inclement weather. As a result, sugar production in 2004 was, unsurprisingly, 35 percent below the already dismal 2003 figure.

Manufacturers dependent on sugar would have done well to anticipate the present problems, and taken steps to get sugar from other sources. However, the Government must bear significant blame for simply not carrying out the closure of Caroni (1975) Ltd in an organised fashion according to a clear time-frame. It was just bad planning.

What makes the present situation even more egregious is that it reflects a typical disregard on the part of Government for agriculture and manufacturing. Different administrations have always made the right noises about the need to diversify our economy, but their indifference to these two main bases of diversification do not suggest that our political leaders are planning for the future — Vision 2020 notwithstanding.

Along with a developed tourist industry, it is agriculture and food-based manufacturing which Trinidad and Tobago will be dependent on when the oil and gas boom ends — and end it will. But, for such diversification to happen, the Government must be pro-active. It must set up proper infrastructure, give tax breaks to entrepreneurs entering these fields, and even subsidise the relevant crops for a specific time-period.

If the Government has been taking action in any of these areas, that action has been exceedingly slow. Citrus production has been dropping, as has the production and exports of cocoa. This latter is especially embarrassing, since Trinidad cocoa remains world-famous and yet we have not been able to fully capitalise on this crop. The outstanding success story, from the latest available figures in the Central Bank’s Economic Bulletin, appears to be coffee, which went from zero exports in the years up to 2001 to exports of 517 thousand kilogrammes in 2003. The potential for agriculture-based manufacturing is also reflected by the fact that tobacco and beverages enjoy a 5-to-1 export advantage.

At present, agricultural, forestry and fishery workers make up about five percent of the country’s labour force. If the sector is given the right kind of boost, this figure would surely go up and, very importantly, disproportionately employ the unskilled and rural workers. If that boost can serve as a base for manufactured products — and Trinidad and Tobago definitely has a comparative advantage when it comes to food and food products — then employment opportunities would be extended to semi-skilled urban workers. The Government could then scale back the false employment of URP and CEPEP, which are only a drain on taxpayers’ wallets.

All this can only happen if the State does its part, however. But, when major manufacturers end up paying the price for Government inefficiency, then the country’s future may not be too sweet.