Caribbean Export is the regional trade and investment promotion agency focused on building a resilient Caribbean by providing cutting-edge and high-impact support to the private sector.
Thirty Business Support Organisations (BSOs) and 150 businesses from across the region will participate in a 5-month joint online training initiative to support E-commerce adoption as part of their business strategies and operations. The technical support provided under the Virtual E-Commerce Accelerator Programme (VEAP) started today, Thursday February 2, 2023.
Two Caribbean digital transformation specialists, Gilbert Williams and Leighton Campbell are facilitating the training and coaching. These master trainers met with representative from BSOs in 13 Member States over a period of five weeks to prepare them with core content and strategy that will allow each of the BSOs to work with at least 5 businesses throughout the rest of the programme. The BSOs will work together with the master trainers to guide the businesses to successfully adopt e-commerce leading to increased sales and expanded market reach.
“The VEAP is part of Caribbean Export’s wider digital transformation of business agenda. Key design elements of the programme include building the capacity of BSOs to deliver e-commerce adoption initiatives to their clients during and beyond the project’s life. I am confident that we have developed a unique and adequate methodology to achieve this outcome.” – stated Phillip Jackson, Programme Lead and Advisor for Innovation and Digital Business.
The VEAP is an 18-month Technical Cooperation (TC) supported by a grant from the French Development Agency through Expertise France, the French international technical cooperation agency and implemented by Caribbean Export Development Agency.
The current training will be followed by a second installment of the programme that will incorporate the lessons learnt from the first iteration. The second phase will target a new cohort of businesses.
For more information or to get involved contact Phillip Jackson at : pjackson[at]carib-export.com
Digital transformation, the green economy and the ease of doing business were the focus of discussion earlier this week, when Caribbean Export’s Executive Director Deodat Maharaj and Services Specialist Allyson Francis met with the Hon. Lennox Andrews, Hon. Andy Williams and senior government officials across several portfolios in Grenada.
During the extensive dialogue, Mr. Maharaj underscored the regional Agency’s commitment to strengthening its partnership with Grenada to drive the Government’s transformational agenda in key sectors.
The Caribbean Export executive team also met with several Business Support Organisations and other partners in the private sector to discuss concrete ways to support private sector investment and business development in 2023.
To address one of the pressing concerns raised during the meeting, Caribbean Export agreed to provide immediate technical support to the creative sector and capacity-building support to the country’s agro-processing sector. The proposed programming initiatives will better equip the MSMEs to use market intelligence tools, understand exporting requirements and the fundamental nuances of the export market.
Of the short but productive visit to Grenada, Mr. Maharaj expressed his delight in meeting with the government ministers and other partners to agree on concrete ways to strengthen the Agency’s support to private sector development and advance the country’s transformational agenda.
With an implementation rate of over 85%, Caribbean Export is pillar-assessed and focused on private sector development aligned to key Sustainable Development Goals. The Agency remains a credible implementing partner ready to help drive Caribbean transformation.
The Dominican Republic and Haiti were jointly present at the important international event Salon du Chocolat 2022 in Paris, France, which took place from October 28 to November 1, 2022. This is the largest event dedicated to the chocolate industry with more than 200 exhibitors from different countries filling the more than 20,000 square meters of Pavilion 5 at Porte de Versailles.
Participating companies from Haiti were AYITIKA SA, cocoa and chocolate producers, and the Federation of Cocoa Cooperatives of the North (FECCANO), a federation of eight cooperatives producing cocoa in northern Haiti. Participating from the Dominican Republic were Chocolala SRL, a cooperative of women cocoa and chocolate producers in Puerto Plata; Grupo CONACADO, one of the country’s largest cocoa producers and processors with more than 33 years of experience; ProAgro, a medium-sized company expanding into international markets with its production of chocolate powder and its La Criollita brand; and Recursos Globales, a family business noted for its CacaoMae brand that produces chocolate and other cocoa-derived products.
These six companies were just a few of the many that make up the Binational Cocoa/Chocolate Value Chain that Caribbean Export launched as part of the actions it implements within the framework of the Trade and Private Sector Support Component of the Binational Cooperation Program between Haiti and the Dominican Republic. This initiative is part of the actions of the expanded strategy that seeks to improve the private-private binational dialogue, as well as to improve the competitiveness of Haitian and Dominican companies with a view to consolidating institutional cooperation between the two countries. The actions of this program are supported technically and financially by the European Union through the 11th European Union Program. European Development Fund. Caribbean Export’s Deputy Chief Executive Officer, Mr. Leo Naut reported that: “The Binational Cocoa/Chocolate Value Chain covers the entire spectrum of the industry, with cocoa producers, cocoa processors and renowned chocolatiers among its beneficiaries. At the Salon du Chocolat, the participating companies received a great reception from the public present, and have also had the opportunity to establish ties with potential business partners in the European Union and other relevant markets”.
ITC and the Caribbean Export Development Agency (CEDA) organized a bootcamp on ‘Access to Green Finance’ on 22-24 November 2022 in Bridgetown, Barbados. The bootcamp included workshops and business matchmaking sessions targeting micro, small, and medium-sized enterprises (MSMEs) from Guyana, Barbados, and Saint Lucia. The workshop aimed to enhance MSMEs’ competitiveness by increasing their knowledge and readiness to access green finance, and resource efficiency and circularity practices with a focus on solar energy adoption.
Access to finance workshop
The first two days of the workshop were led by Access to Finance consultant Mr. Christopher McGann and it included a blend of interactive sessions.
On the first day, participants explored the challenges and opportunities of green/sustainable finance and the relevant UN SDG Goals and Environmental, Social, and Governance (ESG) criteria. They also learned about Credit Risk Abatement Facility (CRAF) facilitated by CARICOM Development Fund (CDF)’s Financial Controller, Mr. Wayne Vitalis. CRAF is a partial credit guarantee facility that provides an incentive for additional lending to MSMEs by financial institutions for renewable energy/energy efficiency initiatives in CARICOM. Lastly, they were introduced to ‘Project Viability and Financing Types’ by Ms. Debbie-Anne Jemmott, Investment Analyst of the Enterprise Growth Fund Ltd.
On the second day, key results of the regional landscape study on access to finance commissioned by the GreenToCompete Hub in the Caribbean was presented, followed by an interactive panel discussion on the risks and opportunities in green financing for MSMEs in the Caribbean with the following expert speakers:
Barbados Fund Access – Ms. Nadia Wilkie, Project Development Officer
CIBC First Caribbean International Bank – Mr. Ray Ward, Associate – Investment Banking
Enterprise Growth Fund – Ms. Debbie-Ann Jemmott, Investment Analyst
CARICOM Development Fund – Dr. Laverne MacFarlane, Senior Economist
Through this discussion, participants companies were able to gain deeper insight into the available services provided by these institutions and requirements to access funds to implement green projects.
Speed dating and matchmaking
To know more about green financing options, speed dating and matchmaking sessions were organized with financial institutions providing green services and products, such as Barbados Fund Access, Enterprise Growth Fund Limited, CIBC First Caribbean International Bank, Signia Globe Financial Inc, Republic Bank Barbados Limited, CARICOM Development Fund, and the Bloom Cleantech Cluster of Export Barbados. Participant companies and financiers discussed opportunities to get access to finance to implement resource-efficient and circular projects and get sustainability certifications since many of the businesses present have been coached by the Hub on these topics.
Visit to solar PV farm
On the last day of the workshop, company representatives visited a solar farm facility to witness firsthand the application of solar PV installed in a sheep farm and learned about its financial viability and sustainability. The visit provided an insight into the range of possibilities of solar farming. The installer also highlighted the type of crops that can be grown on-site and the alternative livelihood (e.g sheep farming) that can possibly be developed in parallel.
What do an Olympic athlete, a mathematician and a university dropout all have in common with each other and the unlimited potential of digital business in the Caribbean? They are all impressive and inspiring Caribbean founders of successful technology start-ups – living proof of what regional entrepreneurs and innovators can achieve.
Just their presence on the stage of the Caribbean Investment Forum earlier this month was an inspiration to the many aspiring and talented innovators from the region, who are trying to burst free of the constraints of the regional landscape, and rocket their digital businesses upwards.
Caribbean Export hopes that their advice, the story of their journey and even their frank views of the state of play in the region will resonate with aspiring entrepreneurs and policymakers alike, as we seek to harness the vast power of ICT to transform businesses, lives and socio-economic development in the region.
The technology entrepreneurs led the Fireside Chat on ICT & Digital Business: Transforming the Region One Gigabyte at a Time, on Day 2 of the Forum (November 10th 2022) at the Hyatt Regency Trinidad.
They were:
Moderator Kirk-Anthony Hamilton, Co-founder & Director of Tech Beach Retreat in Jamaica
Nicholas Rees, Co-Founder & Chairman of KANOO in the Bahamas, which has been authorised by the Bahamas Central Bank to build out and implement Sand Dollar, the world’s first Central Bank-issued digital currency.
Gordon Swaby, Co-Founder & CEO – EduFocal, an award-winning, learning technology platform
Larren Peart, Founder & CEO – Blue Dot Insights – a fast-growing data analytics firm that began in Jamaica, expanded to Trinidad and owns a company in the US.
Pascale Elie, Founder – Cell Pay, a digital wallet and e-payments network operating in Haiti. Her passion and focus is promoting financial inclusion.
As Moderator and technology player in his own right, Kirk-Anthony Hamilton, put it to the audience: “Today, everyone on stage has businesses in multi jurisdictions. We believe technology enables us to reach out more broadly and more quickly and this group, every person on this stage, is aggressively about driving transformation in the region…These are power players. Everyone has raised capital for their businesses and have robust platforms that are very new to the region that are starting to perform well.”
The technology CEOs all agreed that the way forward for the region to benefit from the incoming tidal wave of opportunity for digital business was through partnership, collaboration, bringing ideas together, creating synergies and sharing information. A rising tide raises all boats, they stressed.
It is also part of the positive culture shift Hamilton sees taking place. “We grew up in an era where the conversation wasn’t open and transparent,” you didn’t talk to everybody about what you were doing, and you feared that the bank would steal your concept rather than fund it.
Rees, the two-time Olympics swimming athlete who holds both an MBA and an Accounting degree, noted that when you go island hopping you see that each island has both advantages and disadvantages, you see the commonalities and the challenges. His conviction is: “We can connect the Caribbean through technology and collectively we can solve all our own problems. I really believe that…I see Kanoo as charting that course.”
What’s lacking in the market to more rapidly achieve his vision? “There is still that challenge about access to capital…the Caribbean still does not have an established venture capital firm focused on technology. There are different people trying things to fill the gap. That’s definitely something we need to see,” Rees said.
He is one of the persons trying to fill the gap. Kanoo has partnered with DraperStartup House out of Draper University to see how the Silicon Valley investment mindset can find, fund and facilitate the innovative ideas in the region. “We have launched the Kanoo Innovation Hub based in Bahamas. It is open to everyone in the Caribbean to come learn, participate and get your ideas funded,” Rees said. You have the opportunity to be funded up to US$3 million for your idea, and it will also enable you with access to coders, access to international networks and access to relationships, he added.
How was he able to enter the tech space and succeed? Rees said: “I was lucky in terms of my placement in life, the opportunities that I had, persons I would have met…I’m a two-time Olympian …so in terms of the training, the dedication, the sacrifice for long-term goals – a lot of those values align with success in the business world, the same principles are involved.”
His advice to other technology aspirants: “I would say focus on learning first. Find your purpose, understanding your work and your value. Luck is where preparation meets opportunity, so you have to be patient and walk that dream and follow your intuition and be positive above all things.”
EducFocal’s Gordon Swaby is the youngest entrepreneur so far (at age 32) to list on the Jamaica Stock Exchange. The 10-year old company is an education technology company that is redefining learning today for business tomorrow. The social learning website uses gamification to present its test material to students.
Ironically, Swaby dropped out of the University of Technology and started EducFocal, which has been powering schools and companies with its award-winning learning platform and e-courses.
He told the audience at CIF: “We don’t have a lack of innovators (in the Caribbean) but we have an innovation problem. I believe that young innovators are not being given wind beneath their wings to fly and to create solutions for problems that we have in common in the Caribbean.”
Nevertheless, he urged young people to look beyond traditional paths, which were no longer so rewarding, to achieve their bright future, saying: “A lot of people, within the context of wanting to educate themselves, stay with the tried and true path of becoming a doctor or lawyer when there are opportunities to become something else.” You go to medical school for 10 years and after you graduate you find you are earning less than what you expect to earn. You migrate to another country thinking that you have hit the jackpot and find that you are working harder than you worked in the Caribbean and you’re still not earning what you expected to earn, he pointed out.
Swaby wants to show young people that there is a different path via technology and how it can spur development in the Caribbean. But the ease of doing business has to be improved to encourage young entrepreneurs to live and work in the Caribbean, he added. He related that after purchasing a company in the US earlier this year, part of the process required that he had to register a subsidiary, which he did from his bedroom in Jamaica in two days while he noted that Larren had to come back to Trinidad to register his business.
What is still considered innovation in the Caribbean is not innovation anymore elsewhere, Swaby said. “Registering a company online shouldn’t be considered innovative. I can’t sit here on this stage (in Trinidad) and transfer money easily to Jamaica… I feel like we are having the same conversations for too long…a lot of things should be a no-brainer because they are a no-brainer in other parts of the world.”
Blue Dot Insights is a data company focused on data analytics, modelling, market research and consumer insights. CEO Larren Peart said he started the company eight years ago when no-one was talking about data but, now, data is recognised as an enabler of growth and companies are making decisions with data.
“We’re not short on talent in the Caribbean…What we’re doing now is leveraging the talent we have and exporting our services,” Peart said. “Our data services in Jamaica are cheaper than what a North American company would provide. From a nearshore outsourcing standpoint, that’s a significant advantage to North American companies,” he noted. Unfortunately, he added, “although there is some take up of what we do, now, (in the Caribbean) the North American companies understand the value of it even more.”
“We don’t have a healthy fear of disruption,” Peart said. That is why we can sit back and not innovate. “In the early days of Covid there was all this talk initially about digital transformation and the new normal…That didn’t happen at all in the Caribbean…We’ve gone back to how we were pre-Covid,” he said. There are still lines outside brick and mortar businesses that should frankly not be there, he added.
In the same vein, Peart said that although the most profitable companies in the world are technology companies, if a bank or investor in the Caribbean had to choose between funding a $20 million real estate development or a $20 million technology company, they are going to put their money in real estate. “That kind of thinking has to change,” he urged.
Peart encourages aspiring entrepreneurs to be part of a community and interact with each other. “Community is important. Having access to other entrepreneurs. When you interact with other entrepreneurs you have that shared experience. You learn so much from each other… and it creates a good energy. It is motivational,” he said.
Pascale Elie is the Chairwoman for HaitiPay S.A., whose focus is to develop and implement technological solutions to increase access to financial services for the Haitian communities living in country, in the Diaspora, and in urban and rural areas. She is also Founder and President of CellPay Corporation, an electronic payment solution focusing on connecting Diasporas with their families in underdeveloped economies by sending funds directly to eWallets and can be used within a payment ecosystem.
Believing that technology is the key to economic development and understanding that the larger the market, the more interested are investors, Elie said: “We are looking for viable partnerships in the Caribbean and even Latin America, at some point, to have a larger opportunity so the potential investor will look at us as a very interesting market.”
She urged the other panelists and all those frustrated with the slow pace of improving the ease of doing business in the Caribbean not to give up. “It is important to keep the conversation going and open when talking to regulators. Don’t leave the whole design to the regulators.” The Haitian Alliance for Financial Inclusion was established, she said, “just to ensure we have a seat at the table when talking about financial inclusion in Haiti.”
All the technology entrepreneurs have overcome challenges and obstacles to achieve success. So even as they seek to make the path smoother for the next generation, they noted that entrepreneurs who end up being the most prepared are “the ones who fight their way into a room like this…or drive for miles to find access to internet.” Rees added: “Government should provide infrastructure and enable fair play but the market should drive change. If we see something that needs to happen, we should go do it.”
The inaugural Caribbean Investment Forum took place at the Hyatt Regency in Trinidad and Tobago from November 8-11, 2022. The high-level, business-focused event connected key regional decision-makers, innovators, and entrepreneurs with the world’s most influential investors to explore the investment opportunities available throughout the region. It also served as a launching pad for thought leaders keen on accruing the benefits of first-mover advantages in this developing space.
Under the theme Building A SMARTer, GREENer Caribbean, stakeholders focused, in particular, on investment opportunities in technology and innovation, agriculture technology, renewable energy, and transport and logistics. Projects in these areas will improve the lives of over 30 million Caribbean people in the 23 member countries of CAIPA (Caribbean Association of Investment Promotion Agencies) across the Region.
The regional forum, was organized by the Caribbean Export Development Agency in collaboration with the Government of Trinidad and Tobago, CARICOM, the Caribbean Development Bank, the Caribbean Association of Investment Promotion Agencies and with the support of the European Union.
Visit the event website: www.caribbeaninvestmentforum.com
If the Caribbean region was cut off from the rest of the world, would its citizens starve? If global events disrupted supply chains, could the countries of the Caribbean continue to feed its some 30 million citizens? Could it afford to?
What about the food we do produce, how stable and secure is that supply? Could a climatic event suddenly or slowly, over time, wipe out or negatively impact production so prices skyrocket, people suffer or even riot?
It is these very real concerns that caused CARICOM Heads of Government to commit the region to reducing its food import bill by 25% by 2025. It is why Caribbean Export made Agro-Technology a focal topic at its inaugural Caribbean Investment Forum last week with the theme of the Roundtable discussion being: “Achieving 25 in 5: Reducing the Food Import Bill Through AgTech Investment.”
CARICOM Secretariat Secretary-General, Dr Carla Barnett, laid out the seriousness of the situation clearly during the Opening Ceremony. She said: “Generally, structural characteristics of our economies have meant that we import more than 60% of the food we eat, with some countries importing more than 80% of the food they eat. Over the period 2018-2020, the CARICOM food import bill was US$13.76 billion or approximately 5% of GDP.”
What is more, she added: “The challenge of sustainable agriculture is growing in severity given the exposure of our agriculture sector to climate change-related risk such as heat extremes, salination of ground water, flooding, drought and hurricanes.”
Also emphasising the point at the opening ceremony, Caribbean Export Executive Director Deodat Maharaj said: “We have singled out agriculture in particular given our keen awareness of food insecurity challenges in the region” and recognising that “business and additional investments are critical to achieve this (25 in 5) vision. He added: “This is especially so given the fact that apart from countries like Belize, Guyana, Dominican Republic and Suriname, we simply do not have land space to produce on the scale required to make us food secure. The answer is that we must look to technology.”
The highly dynamic and interactive Roundtable comprised:
Moderator Joseph Cox, Assistant Secretary General, Caricom Secretariat
Mezuo Nwuneli, Managing Partner, Sahel Consulting
Ralph Birkhoff, CEO & Founder, Alquimi Renewables LLC
Vassell Stewart, President, Caribbean Agri-Business Association
Mohindra Persaud, Chief Executive Officer, Nand Persaud & Co
Richard Sellers, Owner, Circular Fuels
Conference delegates, who included farmers, small agro-business entrepreneurs, potential investors and policy makers contributed to the intense discussion around technology in agriculture. There was clear agreement about the need for farmers and agro-processors to use technology more widely, noting that it was helpful along the entire value chain, including with the big problem of praedial larceny, accelerating production yields and quality, and reducing risks.
There was lively discussion on how to achieve more technology-intensive farming and acknowledgement that young farmers were quite open to using technology but often stymied by cost.
Overarching the discussion was a degree of confidence and optimism that there were solutions to all the problems currently suppressing greater agricultural production and a belief that, once there was a will, the food import bill could be slashed.
Mohindra Persaud, for example, had some pragmatic advice. He said: “Farmers on the whole do not like to adapt to new ideas…and are slow to adapt. My advice is to get technical people to tutor them and be patient so progress can be steady. Otherwise, five years would just move production in a very small way.” He also advised that five minutes of training at frequent intervals would be more effective than giving them a booklet or one day of training.
Highlighting the impact the application of technologies could have, and was already having, on agricultural production in the region, Birkhoff noted that it has already been proven that a hydroponics system does not require arable land, uses significantly less water and “could increase yields by 1,000%”.
One greenhouse farmer in the audience, frustrated in his attempts to grow strawberries, learnt there was an engineering solution and who he could approach for assistance. This highlighted the need for fora where farmers and agro-businesses could share experiences and problem solve to find solutions to their specific issues.
The value of anchor farms connected to a group of smaller, satellite farms was also forwarded as a proven solution, with one presenter explaining the anchor farm could provide the smaller farms with technology, training and better quality inputs such as seed stock and then provide a ready market for the output of those small farms. The overall result was an increased and more consistent supply of a better quality product, he said.
The panel of experts highlighted some of the resources available in and to the region, including service providers, funding, technical expertise to solve production and marketing issues, and consulting advice to match talent or funding with a particular project or business based on size, type of project and type of assistance needed.
Assistant Secretary General Cox put it succinctly. “Anyone who feels food security is a dream must wake up from their dream!”
The inaugural Caribbean Investment Forum took place at the Hyatt Regency in Trinidad and Tobago from November 8-11, 2022. The high-level, business-focused event connected key regional decision-makers, innovators, and entrepreneurs with the world’s most influential investors to explore the investment opportunities available throughout the region. It also served as a launching pad for thought leaders keen on accruing the benefits of first-mover advantages in this developing space.
Under the theme Building A SMARTer, GREENer Caribbean, stakeholders focused, in particular, on investment opportunities in technology and innovation, agriculture technology, renewable energy, and transport and logistics. Projects in these areas will improve the lives of over 30 million Caribbean people in the 23 member countries of CAIPA (Caribbean Association of Investment Promotion Agencies) across the Region.
The regional forum, set to become a flagship event on Caribbean Export’s calendar, was organized by the Caribbean Export Development Agency in collaboration with the Government of Trinidad and Tobago, CARICOM, the Caribbean Development Bank, the Caribbean Association of Investment Promotion Agencies and with the support of the European Union.
There is a popular saying which goes “never let a good crisis go to waste”. The world faces a panoply of crises: climate change, the COVID-19 pandemic and a likely global recession if recent predictions from the International Monetary Fund (IMF) and World Bank pan out. Faced with this trifecta of crises, Caribbean governments have evinced greater urgency to work closer with the private sector for diversifying and transforming their economies to sustainable growth and development paths. This article argues that, while not a panacea, attracting foreign direct investment (FDI) in high-value sectors is one of the ways Caribbean governments could achieve sustainable post-COVID-19 transformation of their economies. The article further contends that the benefits of FDI are not automatic and that Caribbean countries’ foreign investment promotion and facilitation efforts must be informed by data, their national development strategies and focused on also wooing regional and diaspora investors.
The economic transformation imperative
In their study entitled “Supporting Economic Transformation”, McMillan et al. (2017) define economic transformation as “a process of moving labour and other resources from lower- to higher productivity activities.” This, they argue, entails not just shifting resources between sectors to higher-value activities, such as shifting from agriculture to manufacturing, but also such change within sectors, such as shifting from producing low productivity subsistence farming to high-value crops within sophisticated value chains (McMillan et al 2017).
For this economic transformation to be sustainable, the process must be informed by a sustainable development framework. Indeed, the concept of “sustainable development” has been the dominant paradigm of development since the 1990s. In its groundbreaking 1987 Report, the Brundtland Commission defined sustainable development as “development that meets the needs of the present without compromising the ability of future generations to meet their own needs” (Brundtland Commission 1987). Following on from the Millennium Development Goals (MDGs), the United Nations’ Agenda 2030 encompasses 17 sustainable development goals (SDGs) and their 169 targets which all countries, including Caribbean States, have committed to achieve by 2030. As identified in the Addis Ababa Action Agenda (2015), FDI is one of the financing channels from which countries could raise the financing needed to meet their development objectives.
Sustainable economic transformation has been a post-independence policy imperative of Caribbean governments. Caribbean economies have largely moved from monocrop economies, focused on the export of agricultural commodities, to services-based economies buoyed primarily by tourism and financial services exports. The commodities-based economies of Trinidad & Tobago, Guyana, Suriname have also been underdoing diversification efforts. The region has seen generally high levels of human development. However, economic transformation of regional economies has been constrained by several structural factors, including small population size, narrow economic and export bases, high import dependence, and their susceptibility to shocks.
In their IMF blog post dated October 2020 Pienknagura, Roldos & Werner (2020) noted that although the region had been relatively successful at managing the virus spread, Caribbean countries were the hardest hit economically because of their heavy dependence on tourism for economic activity and employment. The authors likened the sudden stop in tourist arrivals and local lockdowns to ‘a cardiac arrest to their economies’. The COVID-19 pandemic has further exposed and exacerbated pre-existing social issues: rising crime, large informal economies, youth underemployment and unemployment, poverty and growing income inequality.
The good news is that, as the World Bank (2022) reports, many of our countries are expected to experience positive growth, with Guyana and Barbados projected to lead the Latin America and Caribbean region in growth in 2022 (World Bank 2022). However, many headwinds exist, such the Russia-Ukraine crisis, global inflation, a weakening UK economy and news that the IMF expects some two-thirds of the global economy to contract in 2023. There is also the looming debt crisis as many developing countries, lacking enough fiscal space, were forced to take on new debt to ride out the pandemic.
FDI and economic transformation
Caribbean countries generally have very liberal and open investment regimes. In large part, our countries followed the ‘Industrialisation by Invitation’ model proposed by St. Lucian-born Nobel Prize Laureate in economics, the venerable Sir W. Arthur Lewis. The empirical literature shows that FDI has many benefits for countries, including employment generation, foreign exchange, and the transfer of skills, knowledge and technology. However, Executive Secretary of the United Nations Economic Commission for Latin America and the Caribbean (ECLAC) noted that while FDI was key for economic recovery, “there is no evidence to suggest that FDI has contributed to a change of direction in the development model in the [LAC] region because many inflows go the sectors where transnational enterprises have played a prominent role for decades.” While detailed data on FDI flows by sector is not widely available in the Caribbean, successive ECLAC reports show that most FDI to the region generally goes to tourism and the extractive sectors.
It is increasingly recognized that countries should focus on attracting FDI in sectors which would help them achieve their development objectives. To this end, UNCTAD (2014) has identified in its World Investment Report of 2014 10 SDG-related sectors as follows: power, climate change mitigation, food security, telecommunications, transport, ecosystems/biodiversity, health, water and sanitation, climate change adaptation and education (UNCTAD 2014). The sectors of focus at Caribbean Export Development Agency’s forthcoming Caribbean Investment Forum in November 2022, namely digital economy, agribusiness, the blue economy, sustainable tourism, logistics and transportation innovation and renewable energy are all high growth sectors and sectors which, in many cases, are SDG-related.
How do we make FDI transformative?
First, Caribbean countries should continue to identify and prioritise those sectors in which FDI could be most transformative, in particular the SDG-related sectors UNCTAD (2014) identified. Most Caribbean countries’ IPAs indeed indicate on their websites and marketing material sectors of particular interest to their country for attracting investment. However, there is limited available data on what levels of FDI goes to these sectors and there is therefore need for greater levels of FDI data disaggregation, including by sector.
Second, given the region’s sizable diaspora and efforts to transform the CSME into a single investment space, the focus should not just be on attracting and facilitating foreign investors (those without ties to the region) but also diaspora investors and regional investors. Caribbean IPAs have already made diaspora FDI targeting part of their promotion efforts and these should be intensified. Particularly, it is important to conduct research on what are the potential investment interests of the diaspora and any barriers to investment the diaspora experiences.
Third, investment reforms must form part of a wider investment strategy, which coheres with the country’s industrial and trade policies, all of which are moored to the country’s development strategy. To this extent, it is important for those countries which have them to evaluate the utility of their international investment agreements, in particular their bilateral investment treaties.
Fourth, competition for investors among Caribbean countries cannot be merely on tax rate or incentives alone, but on their value proposition to investors, through things such as market potential, ease of establishment, access to finance, and other factors which investors consider in their decisions. Moreover, despite on-going reforms and improvements, doing business within the Caribbean and between Caribbean countries retains many frictions. Intra-CARICOM trade remains low compared to many other regions due to many factors, including logistical and historical factors but also because of the financial frictions.
Fifth, the aim is to attract investment which is development-friendly, sustainable and inclusive. Therefore, screening of proposed investments to prevent environmental degradation, as well as monitoring to ensure compliance with environmental and labour laws will ensure such investments are sustainable.
Sixth, evidence-based investment policy requires data which is lacking for many Caribbean countries. Limited disaggregated data on investment type, source or sector makes it difficult to empirically assess the effectiveness of investment promotion and facilitation strategies. Moreover, investors often rely on such data in making their decisions on whether to invest or reinvest. As such, a concerted approach to improving the quality, timeliness and availability of data should be a key component of the region’s efforts.
In summary, accelerating the promotion and facilitation of foreign direct investment is one important element for the post-COVID-19 sustainable transformation of Caribbean economies in an increasingly polycrisis world. It can do so by stimulating economic activity, foreign exchange inflows and job creation. However, these benefits are not automatic and must be informed by a sound development strategy and monitored if they are to achieve the desired results.
Your preferred cough and allergy medicines have disappeared from the pharmacy shelf and every time you ask for an out-of-stock item at the supermarket, hardware or appliance store – they can’t say when the item will arrive in the country or at what price. The reason given? Supply chain disruptions as a consequence of the pandemic and Russia-Ukraine war. A catch-all excuse and easy target to blame.
Caribbean importers, businesses and industry are under huge pressure to maintain their operations in the face of uncertain arrivals of goods, high and ever-increasing shipping costs and the ongoing problems of delays and inefficiencies at their countries’ ports.
These businesses and citizens throughout the region might have been shocked at some of the revelations and views that emerged during the passionate discussion around the transport & logistics at the recently held Caribbean Investment Forum in Trinidad and Tobago.
Organized by the Caribbean Export Development Agency (Caribbean Export) in collaboration with the Government of Trinidad and Tobago, CARICOM, the Caribbean Development Bank, and the Caribbean Association of Investment Promotion Agencies with the support of the European Union under the theme, Resolving the Challenge of Caribbean Logistics Through Investment, the panel discussion drew the interest of the large audience attending the event. Both they and the presenters were urgent, insightful and outspoken about the port and shipment issues that they felt could be resolved with political and public will. They bluntly opined that these unresolved and festering issues:
have stunted the development of economies throughout the region;
are threatening the survival and growth of individual businesses and industries;
have, for decades, suppressed the Caribbean region from realising its bright and prosperous potential;
have directly and negatively impacted the quality of life of Caribbean citizens and Caribbean societies;
are the direct cause of many shipping lines leaving the region, with no new entrants replacing them; and
could cause the Caribbean to miss out on huge new opportunities for transformative growth and development through the proposed US Nearshore Act now in Congress as well as from the economic boom in Guyana.
The long-standing issues included:
14 islands with 14 different tariffs instead of a seamless space through which cargo could travel;
lack of standardisation with each country having its own Maritime, Customs and Port policies;
shipping lines leaving the Caribbean frustrated with the lack of co-ordination and collaboration that drove up costs, reduced profits and created an unpredictable business environment;
inefficient ports with unpredictable wait times;
decisions and policies made using emotions rather than facts and data; and
no region-wide support for a single hub to leverage economies of scale as exemplified by Miami.
The dynamic roundtable of presenters was moderated by JAMPRO President Diane Edwards, and comprised:
Elva Williams-Richards, Senior VP Finance – The Port Authority of Jamaica
Darwin Telemaque, CEO – Antigua & Barbuda Port Authority
According to D’angelis, Upturn is seeking to integrate the Caribbean via cargo with its primary focus being to integrate Guyana into the rest of the region. The incentive, he said, was the US$100 million that Guyana would be spending on infrastructure over a number of years.
D’angelis disclosed that negotiations were already taking place to introduce a flat rate tariff system across the region for agribusiness transported via airlines. “We were amazed at how quickly this project is coming into fruition and pretty soon, for certain selected countries, we will be able to offer a flat rate and future export contracts,” he said. He hopes this will create a template that the seaports could then use.
He reminded the audience that the US was looking to the region to provide an alternative to China as a supplier and, if the US Nearshore Act was passed, it presented a golden opportunity to integrate the region. He gave the example of wood being extracted in Guyana, processed in Trinidad and exported to the US market.
Emphasising that the US looked at the Caribbean as one community, he said Upturn’s priority is “portability across region.” In this regard, Telemaque noted that in the US, under the Interstate Commerce Law, no State could restrict movement of trade from another State “so no business person anywhere in the US has to wonder if he can get his product to another State.”
D’angelis also disclosed that Upturn’s research found that: “If I integrate the Caribbean islands in one logistics system I can immediately expect a 15 per cent growth across the region… Today we are losing 15 per cent economic growth simply by not being integrated.” That growth, he added, would pay the cost of integration many times over.
He believes there is a high likelihood that the Nearshore Act will be passed. “The question the region has to ask itself is, if the Nearshore Act is passed tomorrow, are you ready?”
Upturn’s framework sees Jamaica, Guyana and T&T as the main hubs with the secondary markets supplying into the chain.
Can the Caribbean find the will to make it happen? Telemaque believes that Miami port’s efficiency has made the Caribbean lazy because the ship shows up, you get fed, and you figure you don’t have to do anything else. “So the entire system is very relaxed because the ship showed up so …we feel we don’t need a Guyana or Trinidad because Miami is so efficient,” he said.
Pointing to the supply chain issues that have impacted trade in the Caribbean due to the pandemic and war, he urged that “as a people we have to come out of that level of comfort and understand …we have to build our own logistics system.”
He was bluntly honest that the attitude among the countries of the region was: “If you’re going to be a hub, I want to be a hub too…and if you build this facility, I will build it too. And all of a sudden, you have all these things built and no-one is using them efficiently…and Miami keeps doing it efficiently.”
The impassioned speaker stressed: “The first thing we need is honest discussion that we are interested in improving the lives of our people by changing our own individualistic mindset” and that could mean sacrificing our own island’s interest for the region’s, understanding that by doing so, everyone will be better off.
If the decision on who should be a hub is data driven rather than emotional, the answer is obvious, he said, because Jamaica has the only port in the Caribbean with global access and Trinidad has the best connected port in the Caribbean.
To an outbreak of spontaneous applause he urged: “Let’s use the global entry into Kingston. Let’s dovetail the global entry with the best connected port in the Caribbean, that’s Port of Spain, and let’s feed the markets. It’s a simple strategy that is clouded by our individual interest. It’s time to fix that.”
We need to find a way to come together and work on these common problems and find solutions, Williams-Richards said. She also stressed the importance of putting port management “in the hands of people who have the best capability to manage it.” This is not giving away assets, she emphasised. Jamaica put structures in place to ensure the operator delivered and the port has generated more revenue for the government than if it had tried to operate the port itself, she noted.
D’angelis also urged the Caribbean to think outside of tourism because it was not bringing the benefits it used to. He advised that each country should “identify a national champion” that it could export. Each country has that. Antigua’s national champion, for example, could be black pineapple which is sweeter than anywhere else, he said.
For Ramps’ Rampersad, the imperative is crystal clear. He said: “For those of us who live in the Caribbean, what we have to be concerned about more than anything else is quality of life …and that quality of life will always be proportional to the strength and quality of the businesses that operate here in the Caribbean, especially the new businesses and start-ups, and a major component of those businesses being successful is logistics.” Rampersad pointed out that: “A lot of the time, our best and brightest companies can’t scale up because of the logistics component. The supply chain component is extremely difficult.”
Rampersad warned that the region would lose the next generation if we did not solve the problems. “If we are really going to build a Caribbean where the next generation feels they could stay right here and live as good a quality of life versus having to fly up north, then logistics is an important component of that because logistics helps to build better businesses and we need better businesses in the Caribbean in order to have a better life.” The Caricom Heads initiative to reduce the region’s food import bill by 25% by 2025 has given him a new feeling of optimism because he sees it as a rallying banner; something unifying that everyone could get behind and support. “When you listen to President Ali and Prime Minister Mottley and how strongly they are going behind this 25 by 25…it makes you think maybe there is real political will this time to get this thing done,” Rampersad said.
We are living in a connected world in what is already shaping up to be the Connected Century despite inward-looking tendencies by some. The Covid-19 Pandemic is a stark reminder of this reality. However, the same connectedness that allowed for the cascading of this crisis has facilitated the massive scaling of resilient responses and out-pouring of solidarity and support. Collectively, citizens, communities, businesses, and governments are trying to come to terms with the new normal, re-examining their raison d’être and relationships with each other and the planet to allow for sustainability and resilience.
The inter-connected global economy, underpinned by digital technologies and infrastructure may be conceptualised as an ecosystem with a heterogeneous distribution of various resources, exploited by strategic actors mediated through conventions and agreements in a dynamic climate of competition and cooperation.
The implication of such a perspective for economic actors in the Caribbean Region is to first adopt an optimistic framework grounded in the idea of niche opportunities for the diversification of our economies consistent with our collective resources in strategic partnership with relevant global actors. This would require a winning mindset buttressed by a system of intelligence gathering for mapping the global techno-economic landscape and emerging consumer trends to inform new product and business model innovation, and the improvement or repositioning of existing good and services Caribbean businesses offer to a global marketplace.
Businesses wishing to internationalise and grow, must adopt appropriate digital technologies and business models to improve their products and production processes, establish attractive online presences to advertise these products, engage with customers, receive payments, deliver purchases, provide after sales services, and connect with suppliers and logistics partners. The Covid 19 Pandemic has proven that companies in our Region can digitalise certain aspects of their business to respond to changing market conditions.i The challenge is to incentivise more businesses to adopt and to support expansion and consolidation of adoption among companies who have already started the journey.
To facilitate this process of digitalisation, Caribbean companies will require investments of various types as they typically lack the requisite knowledge, skills, and capital to do so on their own.ii To guide and focus their digitalisation strategy, companies can immediately focus on crucial areas such as market presence, customer engagement, operations, and the organisational setup.
More specifically there are opportunities for investments in the following areas:
Providing knowledge and skills training to management and staff in the understanding and management of digitalisation.
Training and capacitating in-country digital services specialists who will work one-on-one with companies to establish their level of digital maturity and elaborate a responsive digital adoption plan consistent with their business strategy.
Proving capital to fund the various investments and activities defined in the adoption plan
As more Caribbean businesses sell online to foreign markets there would be a need for improved logistics services. The cost-effective provision of these services will encourage the adoption of E-Commerce by more businesses, creating a virtuous cycle of digitalisation in the wider economy. In traditional industries like agriculture and agro-processing there are investment opportunities for the use of appropriate technologies in production; creating digital marketplaces to integrate the value chain; as well use of sensors for traceability of products from farm to factory to consumer, enhancing trust and building reputation among value-based consumers and intermediaries. Consistent with recent near-shoring efforts, the Region is a prime destination for new investments in call centres, information processing and business process outsourcing, given our strategic location, our languages, and the availability of the requisite skills to support these operations.
From the perspective on new product development, there are opportunities to take advantage of our unique culture including music to create innovative products with mass appeal for non-traditional markets taking advantage of existing in-market consumer behaviour and infrastructure for consumer engagement.
I want to end this section with what I believe is a winner. The Caribbean Region possesses the creative capacity to pursue big bold initiatives in partnership world-class technology companies in areas where we have a decidedly competitive advantage. The concept of the Virtual Caribbean through Virtual Reality Tourism is a tremendous opportunity for investment through strategic partnerships given the Regions’ unparalleled diversity of beautiful landscapes and seascapes that can be virtualized and gamified for a growing market of “Digital Dwellers”. As the consumer hardware for accessing virtual reality content becomes more affordable, adoption of VR adoption would be driven by the availability of new type of quality and interesting content for new market segments. Virtual Reality Tourism (VRT) is a prime content area to drive new adoption.
Conclusion
The Digital Economy presents tremendous opportunities for digital entrepreneur to exploit. The individual, businesses, investors, and governments must conceptualize and equip themselves as entrepreneurs in this multi-dimensional digital economy. The task requires a winning mindset with a focused global-local approach to knowledge building of our indigenous resources and emerging trends, and visionary yet attentive leadership to initiate and sustain strategic partnerships with local stakeholders, key development actors, and global industry players.
The Caribbean Export Development Agency is carrying out a survey to understand the contribution and impact of our activities on businesses since 2017, during the implementation of the 11th EDF Regional Private Sector Development Programme funded by the European Union (EU).
The programme aims to support the development of businesses in the Caribbean and support them to export their products and services ultimately to create jobs and alleviate poverty. This survey is designed to collect information on the Agency’s activities and resources e.g. grants, trade missions, webinars, trainings, resources via website, amongst others.
Take Survey
Please be informed that all information shared and collected via this survey will be used for the purpose of reporting the outcomes and impacts of the activities on your firm and will be shared with the relevant donor partner.
Thank you for your participation and we look forward to supporting you in the future.
This week the Caribbean Export team are showcasing fourteen Caribbean brands to exhibit at the world’s largest biannual trade fair SIAL in Paris, France. Expecting more than 310,000 visitors over the five days from 14th – 19th October the Caribbean companies will showcase under the Absolutely Caribbean pavilion.
Exhibiting companies include new brands such as Only Coconuts by Precision Global Inc., who’s 30,000 sq. ft. state of the art processing facility in Guyana, certified non-GMO and HACCP produce a range of coconut-based products that are 100% pure and natural.
With a fresh new look VincyFresh (formerly Winfresh) continue to present their authentic marinades, sauces and condiments and promise to help you ‘LiveWell!’ by using the finest of ingredients that are grown in St Vincent and the Grenadines rich volcanic soil.
Other sauce and condiments producers also presenting include Superb Blend by Jays Enterprises from Barbados, Flauriels organic and natural range from St. Kitts and Nevis and natural turmeric paste Truly Turmeric from Belize by Naledo. Surinamese producer GOM Food Industries are also offering their gluten free, vegan, Halal and no MSG sauces for export.
For the chocolatiers, Great Taste Award 2022 winner Cacoa Sainte Lucia is pulling in the crowds who are looking to try the award winning 100% cacoa vegan chocolate and Premium Dark Chocolate Almonds. In addition, Haitian producer Choko Lakay ferments cocoa beans making them darker and sweeter in flavour with a smooth profile.
Pairing nicely with chocolate is Jamaican Blue Mountain Coffee by Country Traders. Arguably the worlds finest coffee, this silky smooth, well-balanced, full-bodied coffee is available for export and sources it’s beans directly from local farmers in the Blue Mountains of Jamaica.
When it comes to drinks, the Caribbean is widely known as the birthplace of rum and whilst we welcome premium rums from the Dominican Republic with Chicaron (a cinnamon rum), J&J Spirits and St. Lucia Distillers, we have women-owned V’Toria Rhonda Vineyard & Winery.
V’Toria Rhonda offers six innovative, exotic, tropical fruit wines blended with various grape varietals.
And after sampling all the food and drink available from the 200 countries at SIAL, be sure to check out the 100% natural herbal dietary supplements brought to the market by Natural Organic’s LLC. Their supplements aim to detoxify the body, fight against inflammation, regulate blood sugar levels and reduce cholesterol, amongst others.
