The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Bahamas is “20 years behind” on safeguarding its agriculture producers and modernising its economy, a leading consultant yesterday telling Tribune Business this failures had “decimated” local farmers.

Godfrey Eneas said the Bahamas had paid “a very serious price” for failing to use non-tariff measures to prevent the ‘dumping’ of inferior food products in this nation by foreign producers - a practice that has undercut Bahamian farmers on price, and driven them out of the market.

The Ministry of Agriculture adviser added that the sector’s share of Bahamian GDP had declined to a “terrible” less than 1 per cent, compared to the 5-6 per cent contribution it made in the 1970s and 1980s.

Suggesting that “poor policy” decisions by successive governments had contributed to agriculture’s decline, Mr Eneas said the Bahamas’ food security weaknesses and inability to feed itself had contributed to food becoming “almost unaffordable” for many segments in society.

Tribune Business revealed this week how a $20 million poultry production project, proposed for North Andros by Florida investor Robert Parker and Jamaican firm, Caribbean Broilers, was “abandoned” after the Government declined to provide all the investment incentives it was seeking.

It did so on the grounds that the ‘special treatment’ was “unwarranted”, and would have given a foreign-owned project better incentives than those available to Bahamians, placing the latter at a competitive disadvantage.

Mr Eneas, though, agreed that the project’s request that the Bahamas enact protective anti-dumping legislation was warranted.

“People want to invest in areas where they can get a return on investment, but our markets are too open and they may not get the benefit,” he told Tribune Business.

“Because of not being a member of the World Trade Organisation, we have fallen behind in how to protect our market. There are a lot of ways to protect your market, not just tariffs.”

The Parker/Caribbean Broilers project had sought a 40 per cent ‘ad valorem’ Customs Duty rate on imported chicken to facilitate their project, on the grounds that “protection against foreign competition is absolutely essential to have a viable poultry industry”.

Mr Eneas, though, said high duty rates hurt Bahamian consumers by translating into higher prices. He added that the Bahamas could instead employ health standards, such as Sanitary and Phytosanitary (SPS) measures, to restrict inferior imports and protect both Bahamian farmers and consumers.

“We need to, and will, come up to speed on that now that WTO is being addressed,” Mr Eneas said, referring to the Standards Bureau and SPS measures now being put in place to facilitate the Bahamas’ accession to full membership.

Yet he argued that the Bahamas’s failure to adjust to global change earlier, and modernise its economy accordingly, the WTO having been formed in 1995, had left this country with a ‘two decade catch-up’.

“We fell behind in the era of globalisation,” he told Tribune Business. “We’re 20 years behind. We’ve paid a very serious price. It has decimated the [agriculture] sector.

“I can show you data on how the sector has declined over the last 20 years. It’s contribution to GDP is less than 1 per cent. That’s terrible. Our agricultural contribution in the 1970s and 1980s was as high as 5-6 per cent.”

Statistics produced by Mr Eneas show that, in 2012, the Bahamas was estimated to have less than 1,000 farmers and under 10,000 acres in use, compared to 4,214 farmers and almost 90,000 acres in 1978.

And the number of workers employed in the industry had shrunk from 9,717 in 1978 to 1,500 in 2012.

Analysing the negative impacts created by the absence of Bahamian anti-dumping legislation, Mr Eneas said: “It opens up your market to poultry producers from Brazil and the US, where legs, wings and backs are by-products.

“They dump it on us, and the US subsidises its exporters. It devalues the market.”

The Parker/Caribbean Broilers project had requested that Bahamian anti-dumping legislation be based on the price of the ‘whole chicken’ in the producing country, not the price of the ‘throw away parts’. Duty would thus be based on the former price, “not on a ‘get what you can pay for it’ price”.

He added that Caribbean Broilers, and other CARICOM states, recognising chicken’s position as the leading source of protein, and the sector’s employment impact on their economies, had unlike the Bahamas taken measures to prevent dumping in their markets.

“We have been lethargic. There’s no longer a poultry industry in the Bahamas pretty much,” Mr Eneas said.

He also criticised the former Ingraham administration’s policy of reducing duty rates prior to WTO talks, rather than going in with higher rates to give more negotiating room.

“It was a poor policy position for the agriculture industry,” Mr Eneas said. “In eggs, they have tried to increase the duty a little bit, but the Government is very sensitive to that, as an increase in duty causes an increase in price.

“This is why governments do not use them as the main tool to control their markets, but SPS and standards. That’s why it’s so important a Bureau of Standards comes into play.”

Mr Eneas said food security, and the region’s huge food import bill, were the leading agriculture policy items for the CARICOM Heads of Government.

“We have to address this food import bill because, first of all, it’s unsustainable, and two, food is almost unaffordable for segments of Bahamian society,” he told Tribune Business.

“If you talk to the people from Hands for Hunger, almost 70,000 Bahamians have to get a free meal per day. Food is unaffordable.”

This, Mr Eneas said, was contributing to many Bahamians’ dietary problems, resulting in non-communicable diseases that burdened the healthcare system with extra costs.

With Baha Mar set to boost the Bahamas’ stopover visitor numbers by 500,000 annually, taking it to around 1.8 million, Mr Eneas said other Caribbean countries would “love to have an internal market” like that which could be targeted by their food producers.

But, under the current system, Mr Eneas warned: “We’re losing too much foreign exchange. We’re just going to let all that money go out of the country” when it came to tourism dollars being recycled for food imports.