Failure in agriculture

Speaking at the opening of the 2006 Farmers’ Forum last week, Mr Narine made the obvious point that the government had to serve the needs of competing interests. But, according to Mr Narine, giving farmers “a bigger slice of the national pie” could lead to the neglect of sectors such as health, education, national security, housing and infrastructure which, in turn, would have dire consequences.

This statement is at odds with what Government spokespersons for the other areas typically promote — the usual message being that just because the Government is spending millions of dollars on, say, blimps, this does not mean that there isn’t enough money for other sectors. But Mr Narine apparently misses a more fundamental point — that State funding of agriculture, properly handled, is an investment that will reap dividends for the entire country down the line.

The same is not true for housing — at least, not in the way the Government has gone about constructing and distributing units.

In that sector, what has happened, and what will continue to happen as long as the Housing Development Corporation (HDC) refuses to be transparent in its dealings, is that taxpayers end up subsiding houses for low-income earners. And, while there are some good arguments for doing this, the principle enunciated by Mr Narine — competing national interests — must always be taken into account. A similar criticism can be made of the Government’s spending on the Tarouba Sporting Complex and some of the capital city projects, which are not being driven by a cost-benefit analysis but by narrow political considerations and the availability of energy dollars.

Yet if the Government is really committed to developing the non-energy sector, then agriculture must be a key component in this strategy. This is not because of the need to achieve “food security,” as is typically argued. That concept is a 19th-century holdover, relevant to a time when wars between nations regularly disrupted shipping. Nowadays, “food security” is often just a euphemism for protectionist policies, the main consequence of which would not be to make food cheap and available to the populace, but to make it expensive and scarce.

So why is developing agriculture important? Basically, because there are food products where the Caribbean has a comparative advantage to exploit.

If the agricultural sector can be developed properly, then farmers will grow enough products to provide local demand as well as export. But those products will be specialised — tropical fruits and vegetables which are in demand overseas. And, once the primary production is stable, food-processing becomes a spin-off that leads to greater value added to the main product.

But the Government’s role in all this should be limited, since State intervention in farming has never created greater productivity in any country in the world.

Invariably, the State ends up subsiding farmers or farms’ produce so inefficiently that scarcity is the rule rather than the exception. The State’s duty in this area is only to provide proper infrastructure, such as roads and a reliable water and electricity supply, and perhaps to give tax breaks and soft loans to farmers.

But it is the farmers who must decide what to grow and how to sell it. Not only will the country then have a new avenue to earn foreign exchange, but semi-skilled persons will have the opportunity to get productive jobs not available in the energy or construction sectors. And this is why Mr Narine’s argument is exactly backward: it is the failure of the Government to develop agriculture which has, in part, led to the dire consequences the country is now experiencing.