Diversification — old wine in new bottles

Seven industries have been identified to propel the envisaged diversification.

They are (Newsday 25/03/17): (1) manufacturing for exports; (2) near-shore financial services; (3) creative industries; (4) tourism; (5) energy services; (6) digital platforms, business process outsourcing and transshipment, and (7) ship repair and maritime-related services.

However, these industries or sectors are not new except for “digital platforms,” whatever that may mean.

In 2004 (13 years ago), the Patrick Manning administration listed six main sectors in its pursuit of diversification.

Among them was “the traditional manufacturing sector.” The current advisory board has identified in its roadmap “manufacturing for exports” as one of the recommended industries for focus.

Where the 2004 plan specified “financial services” for attention, the current proposals list “near-shore financial services.” The roadmap points to “creative industries” to be pursued, whereas the 2004 statement, while not labelling it “creative industries,” targeted “music and entertainment” and “the film industry” for further commercial expansion.

“Tourism” was a feature of both the 2004 outline as well as the current one.

While “energy services” identified in the new dispensation was not mentioned as a sector as such in the 2004 statement, the latter did propose “engineering technology” and “petrochemical manufacturing and services including industrial maintenance, logistics and distribution.” While “business process outsourcing” was not specifically mentioned in 2004, it would have been subsumed under the plans for the Wallerfield Industrial Park.

The “ship repair and maritime-related services,” pointed out in the roadmap as areas for current attention, would have been more or less covered by the emphasis on services to “yachting” and “merchant marine” in the 2004 plan.

Mention of “transshipment” may have been used as an embellishment to the maritime project given the absence of productivity, efficiency and physical infrastructure required for a successful transshipment industry.

I have gone into considerable detail in comparing the advisory board’s recommendations for diversification in 2017 with the plans elaborated in 2004 to show that, except for the omission of “agriculture” (to which I will come later), there is in effect nothing new as areas to be targeted in the new dispensation.

As a result, one may come to the conclusion that, as far as diversification of the economy is concerned, either there are no other options to the sectors or industries identified or that the board’s proposals incorporate strategies, plans and agendas for successful implementation and execution to overcome the failures of the past. The board’s roadmap identified what it called “seven enablers” which are to be pursued prior to or pari passu with the diversification thrust. They are (Newsday 25/03/17): “(a) infrastructure, both physical and abstract assets such as health and education; (b) diaspora engagement; © foreign direct investment; (d) economic and commercial diplomacy and branding TT; (e) innovation; (f) private sector and university collaboration, and (g) institutional reforms.” The identification of these socalled “enablers” as necessary support structures for the diversification drive is again nothing new and have been discussed and advocated for years without tangible progress.

Noted are the references to the importance of the coordination of efforts between the private and public sectors, of stakeholder leadership, of inter-ministerial collaboration and focused actions, of research and development, of worker productivity and the work ethic. If these sentiments have been heard many times before, a restatement for emphasis may be what was intended.

As regards the omission of “agriculture” as a sector of focus for the purposes of diversification, the edi t o r i a l in one newspaper has f o u n d it puzzling.