Robert Buddan, Contributor
CARICOM officials say that food prices have risen by 40 per cent in the region and we now spend US$3 billion importing food. Ricky Singh reminds us that back in 1975 in the midst of the effects of the 1973/74 oil-price crisis and the looming balance of payments problems, the relatively new CARICOM had proposed a Caribbean food corporation to promote food production. It did not get the support it needed. More than 30 years after, we are reviving such ideas. In truth, the vision of CARICOM and food self-sufficiency goes much farther back.
The Jamaica Labour Party (JLP) was won over to the idea of federation in the 1950s on the consideration that Guyana could be the breadbasket of the region. That was nearly 60 years ago. Then, the JLP walked out of the federation and here we are, buying food from others and paying what they charge on a world market over which we have no control.
Cheaper alternatives
Now we hear that the JLP government has sought the assistance of the same Guyana to grow rice in Jamaica. At the same time, the Government is looking outside of CARICOM for cheaper alternatives to Guyanese rice. We were growing rice here in the 1970s. Why did we not sustain that?
CARICOM is planning anew to deal with the food price crisis. It thinks that mega-farms with public and private partnerships in the larger countries like Guyana, Suriname and Jamaica will soften the impact of future crises. Guyana is ready to assist Jamaica, while offering its own land cheaply to investors, including the Jamaican Government. A conference in June will tell us about the other incentives and involvement. Potential financiers representing the banking sector and farmers will attend. Barbados and Trinidad have little agricultural land of their own and have shown strong interest. At the same time, ministers of agriculture from the 'other Caribbean', Cuba, Haiti, and the Dominican Republic, recently met with their counterparts in Central America to address the same crisis. They have included Venezuela, a potential financial investor, in their meeting. Venezuela has just donated 350 tons of food to Haiti after food riots there.
World food trade
The Caribbean might have failed to cushion itself from this crisis, but high food prices also affect developed countries that have mega-farms and huge agri-business multinationals. The real problem lies in the way the world order is organised and the bias that is inherent in how it works. In the late 1950s, Latin American economists said they had discovered a long-term tendency for the price of raw materials (including agricultural produce) from the developing countries to fall relative to the price of the industrial products that they imported. This was leading to negative balance of payments and debt crises. The Jamaican Government was not ignorant of this. From earlier in the 1950s, PNP spokespersons in Opposition, including Noel Nethersole, spotted this tendency. But the finance minister, Donald Sangster dismissed it.
The balance of payments and associated debt crisis did occur in the 1970s and 1980s, but the International Monetary Fund's (IMF) response had more to do with lowering tariffs to let in Western imports than with industrial development. Take Haiti's case. Thirty years ago, Haiti was self-sufficient in rice. But after 1986, the IMF prescribed that it lower tariffs on imports. After two years, the rice industry was killed off with cheaper American rice imports. America's heavily subsidised rice, including dumped surplus rice, caused Haiti's rice production to collapse. I wonder whether that is what caused our rice farms to close shortly after the IMF came here.
Rescue developing countries
After IMF policies fell into disrepute, the World Bank, its 'sister' organisation, was brought to the fore as the development organisation that would rescue developing countries. Its recipe was to liberalise the state under the phrase 'good governance'. It did not invest in agriculture or industrial policy.
A spokesman for the United Nations Conference on Trade and Development (UNCTAD) has now pointed out that international aid organisations spent US$1.3 billion on governance initiatives between 2003 and 2005, but only US$12 million to develop agriculture.
This was happening at a time when agriculture badly needed assistance because for the first time in modern history, more people were looking for jobs in urban areas outside of agriculture than ever before.
Then there is the problem of unfair trade. Developed countries have been preaching the benefits of free trade, while relentlessly holding on to heavily subsidies agriculture. Bill Quigley writes that the US subsidised rice by US$11 billion between 1995 and 2006. Big agri-business multinationals are getting hundreds of millions in subsidy to wipe out poor farmers in developing countries like Haiti who cannot compete.
RUral development
How is Jamaica's proposed rice industry going to compete against Miami rice and all the other brands in the face of 'free trade' with Europe and the United States? The World Trade Organisation (WTO) has complained that it has not been able to get the countries of North America and Europe to do away with subsidising their richer farmers.
In the so-called Doha Round of WTO negotiations (going on since 2001), developing countries want developed ones to cut out subsidies, while the former wants the latter to cut back tariffs on food imports and farm goods. North America and Europe are also battling each other, with each side trying to get the other to cut its subsidies.
The problem is not just that people are finding it harder to afford to eat. Cheaper food is a thing of the past, according to the United Nations and the Economic Commission for Latin America. ECLAC feels that the region's poverty rate will rise about three points for every 15 per cent rise in the price of food. Jamaica's improving record of fighting poverty is likely to reverse. But there is worse. When people do not eat well, their immune systems get weaker and they fall prey to more illnesses more easily. More people get sick and a greater burden on the health system results. Furthermore, people do not do as well in school so the educational system does not produce the results expected.
What the region needs is really a rural development policy to make people live longer, healthier, happier lives. For more than 30 years, CARICOM has presented an opportunity for the region to invest in agriculture. The US$3 billion we spend on food imports each year onward could help to build rural development. There is room for local investment in agriculture.
Will investors spend?
But will the investors spend on rural development? Jamaica Broilers is interested in rice production. Its executive director, Robert Levy, is important enough to get an immediate meeting with the minister of agriculture while the typical small farmer does not have that privilege. We must be careful about how corporate Jamaica organises agriculture. It cannot be allowed to get the best land for the crops that fetch the best prices. Let us hope the corporate powers entering agriculture do not marginalise the farmers further.
Robert Levy's poultry industry model could be applied to other areas of agriculture to assist in setting up and buying from independent rice and other farmers, a model Michael Manley had favoured. In fact, both the JLP and PNP had a vision for agriculture built around independent small and medium-size farms. The minister must have a plan that is consistent with this, a plan for rural development, not just rice production.
Robert Buddan lectures in the Department of Government, UWI, Mona. Email: Robert.Buddan@uwimona.edu.jm
