The Tribune

• Overhaul’s long road as sector output under $30m

• Three-year 15% growth needed to recoup Dorian hit

• Over 70% of current farmer crop over 60 years-old

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Bahamas can slash $190m off its food import bill only if it completely “reinvents” the business model for its shrinking agriculture sector, the Inter-American Development Bank (IDB) has disclosed.

The multilateral lender, in a series of reports tabled in Parliament yesterday, exposed just how far The Bahamas is from realising ambitions to boost domestic production and food security by revealing that a 15 percent annual growth rate is required to recover agricultural production capacity lost to Hurricane Dorian in September 2019.

The category five storm’s impact worsened a decline in annual sector output that fell below $30m in 2018, with the IDB report’s author, Carlos Puig Esteve, revealing that real value added by the industry fell by more than 183 percent between 1995 and 2017.

“In order to expose the challenge for the country, and considering that the agricultural sector has lost at least one-third of its agricultural production capacity as a result of Hurricane Dorian, the reconstruction effort would need to reach 15 percent annual growth over the next three years to return to its 2018 production level,” the IDB report, which was completed in December 2019, said.

“Maintaining this growth rate of 15 percent over the next five years (through to 2027) would double the country’s agricultural output in eight years. Such an objective would be ambitious but achievable, and possibly be surpassed if the appropriate incentives to facilitate investments in improved technologies, greenhouses and polytunnels were facilitated in the short-term while focusing on young people.’

The study repeatedly focused on The Bahamas’ aged population of existing farmers, some 70 percent of whom were said to be aged 60-plus, and with an absence of successors and/or younger enthusiasts to take over their business.

“The decline in the number of farmers has been significant, from 4,246 in 1978 to 800-1,000 maximum in 2019, of which 70 percent are older than 60 years, which represents an immense challenge since the sector does not attract young farmers,” the IDB report said.

The government-appointed Economic Recovery Committee (ERC) also referred to similar growth targets in its summary report, and there are indications that the Government may be following much of the IDB playbook in its efforts to revive the contracting agricultural sector after COVID-19’s devastating fall-out revived interest in boosting the nation’s food security.

Michael Pintard, minister of agriculture and marine resources, told the recent Bahamas Business Outlook conference that this country could slash its annual food import bill by $200m through focusing on the production of 77 organic items as suggested by an IDB report that, at the time, he did not identify.

It is unclear whether the documents tabled in the House of Assembly yesterday are what he was referring to, although there is a high probability they are. The $189.6m “import substitution” figure cited in yesterday’s documents is extremely close to the numbers cited by Mr Pintard, while they both detailed the same areas as having the greatest potential for Bahamian farmers.

“Agri-food and ornamental crop import substitutions represent a potential value of $189.6m, or 28 percent of total agri-food products and ornamentals imports [of] $678m,” the IDB study said, adding that this sum included $117.8m worth of fresh and chilled food products, plus live plants, that could be supplied by domestic Bahamian producers maximising their potential.

“The $117.8m potential import substitution of fresh products represents four times’ the country’s total estimated agricultural output value of $29.7m in 2018,” the report added. “Vegetables represent the largest import substitution potential among fresh and chilled agri-food products ($44.8m of the $117.6m, or 38 percent at 2018 levels.

“[This is] followed by fruits at $30.2m and plants at $14.7m. The potential for fresh animal products is lower: Poultry, $10.1m; Swine, $7.6m; sheep and goats, $5.3m; eggs, $5.1m; but jointly make up $28.2m or nearly a quarter of the total substitution potential at 24 percent.”

The IDB study added that fresh product imports, which Bahamian farmers should attempt to replace, had increased by a 10.3 percent annual average growth rate over the three years to 2018, indicating the potential for domestic producers to service an expanding market.

However, it warned that to achieve its agriculture goals, The Bahamas will have to completely overturn its present farming model and the ways that the Government supports the industry. One flaw it identified involves the management of 38,857 acres of Crown Land that the Government has allocated for lease to farmers.

These arrangements are supposed to be overseen by the Ministry of Agriculture and Marine Resources’ Land Unit, but the IDB report said there was no oversight and follow-up to prevent this land from being used for non-farming purposes.

“The Ministry of Agriculture and Marine Resources’ Land Unit does not follow up on the exploited lands, and on the business plans initially proposed by the farmer in exploiting Crown Land, which results in a large part of the leased lands not being used for agricultural purposes,” the IDB report said.

Noting that The Bahamas’ agricultural exports totalled just $800,000, or less than 1 percent, in 2018, the study recommended radical reform as the only way to save a sector that has effectively been dying a slow death for decades.

“Fundamentally different business conditions might need to be promoted to reverse these trends,” it added. “The Government of The Bahamas’ marketing system approach, using guaranteed purchases, is inefficient and unproductive, and has become increasingly expensive to operate while lacking a market-driven approach.

“The marketing of agricultural produce is constrained by inadequate information on domestic supplies, pricing and sales opportunities, which has become a major limitation. This contributes to a mismatch between supply and demand, preventing buyers and suppliers from coming together and contributing to a lack of market transparency.

“The technical analysis leads to confirming that in order to be more competitive in the market, it is essential to reinvent the ways of doing and the strategies implemented so far.”