July 1, 2022

Marketing of Agriculture Commodities and the OECS

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Article Courtesy Hon. Saboto Ceasar, Minister for Agriculture, Forestry, Fisheries, Rural Transformation, Industry and Labour

Thursday, April 14, 2022 — The history of colonial commercial agriculture in the British West Indies was founded on free labour, conquered land and state consolidated marketing. The former two factors of production were obtained and maintained through coercion, and in the case of the latter, the Colonial State was responsible for the establishment of the capitalistic marketing of raw material to feed a European processing appetite.

Legislative changes in Britain in 1833, impacted labour relations between 1834 and 1838 and liberated the workforce and in particular, the coercion of labour. In addition, the anti-colonial movements driven by a quest for sovereignty and self-determination emancipated the hold on political power giving rise to independent nation-states and triggered a seismic impact on land ownership. The decline of the plantation economy for sure was even more defined because of the resultant implications on the plantocracy of both the Sugar Duties Equalisation Act of 1846 and the  Encumbered Estates Act of 1854.

The export Banana Industry which began in the 1960s, saw the last major thrust for the establishment of a smaller group of islands (Windward Islands) to pursue actively the consolidated marketing of an agricultural commodity. In the final decade (1970-1980) of a State-dependent environment without coerced labour, we benefited from a well-entrenched preferential trade regime, and engaged in multi-nation consolidated marketing of agriculture products for export extra-regionally.

The birth of the 21st Century has brought a different confluence of circumstances:

  1. Preferential erosion was made complete by the results of the WTO ruling in the Banana case;
  2. Rise in technology and the internet age has created the stage for small island states to participate in international financial services provision, as an alternative to a pure agricultural approach to development; and
  3. Climate change is more pronounced in its negative impacts on agricultural production.

This brings us to the last two decades (2000-2020), where we have witnessed in the Windwards the extinction of the profitable export of bananas extra-regionally, because of changes in market conditions in Europe.  This over the last ten years created an excellent opportunity for the full emergence of a local entrepreneurial class of traffickers or traders of fresh produce to rise to the occasion to almost totally guide the export of agriculture commodities from the Windwards. This export has been primarily regional.

For the most part, Dominica seized the opportunity by virtue of being geographically closer to the BVI, to almost monopolize that market, while the islands of St. Vincent and the Grenadines, St. Lucia and Grenada sought to supply the Southern Caribbean. This trade has been largely only regulated from a plant quarantine standpoint and operates outside of any contractual certainty in prices, supply and/or demand. 

St. Vincent and the Grenadines has vigorously advocated a diversification strategy since 2001. The successes thus far are as follows:

  1. The re-establishment of the cocoa industry, which has empowered the private sector to now export mainly to the UK a bar of world-class chocolate;
  2. The establishment of a plant-based medicinal wellness industry, with the export of cannabis already made to Europe;
  3. The exponential growth of the fisheries sector with marine products exported to as far as Asia;
  4. A livestock export trade to Grenada, with unsupplied requests from several other OECS Member States. SVG has exported cattle valued at approximately $250,000.00 to Grenada in April 2022; and
  5. St. Vincent and the Grenadines has firmly cemented its space in the CARICOM regional market, Europe (mainly the UK and France), Miami and the USVI as a producer of high-quality root crops for export. 

It is without doubt, that the COVID-19 pandemic has disrupted trade regionally where markets purchase from the bulk of our farmers through traffickers. Further, difficulties in the repatriation of funds which are the proceeds of sales; recent volcanic eruptions; the rising cost of production and trade as a result of the Russia/Ukraine Conflict have all taken the traffickers of SVG to the tipping point.

It is as a result of this current need that the State in SVG has advanced the proposition to not only intervene, but also to play an activist role again in the marketing of those agricultural commodities in need of marketing support. It must be noted clearly that this is not an attempt to “take food from the mouth of the trafficker”, instead, it intends to organise a system for the benefit of farmers and all value chain participants inclusive of traffickers.

For the upcoming national and regional consultation, the following list, among other issues will be raised for discussion:

  1. Which commodities will be targeted by the marketing body?
  2. What will be the structure and shareholder ownership of the entity which will facilitate the trade?
  3. What will be the roles played by Invest SVG, Bureau of Standards and the Ministries of Agriculture, Foreign Affairs and Trade, IICA, FAO, CARDI, CRFM, technical missions of friendly governments, and the OECS Commission and the CARICOM Secretariat?
  4. How will traditional local exporters be integrated?
  5. What model would be used to ensure the full democratisation of the value chain in the interest of creating an equitable platform for all stakeholders?
  6. Which will be the major target markets?
  7. How will the rapidly emerging agro-processing sector and the fast-growing hospitality industry be integrated with the process?
  8. Will there be a need for production support on credit to meet market demands and how can contracts and agricultural land be used as security to obtain capital? Which lending institutions will see this as viable?
  9. Will the OECS Food Production Corridor be launched soon as a platform for the consolidation of commodities marketed by a St. Vincent and the Grenadines entity, to be aggregated with commodities marketed for export by similar entities in Dominica, St. Lucia and Grenada and other OECS states?
  10. What infrastructure will be needed and where will it be placed to maximise efficiency?

It is therefore anticipated that in short order, stakeholders will build a people-centred marketing platform; capital will be committed to pursuing the objectives of the plan and we will see full implementation.

The cliche is simply unavoidable, this will be a “game-changer”. The measure of success has to always remain that when this model is fully operationalised, the well known “build, operate and transfer” model will be explored for this platform.

I am confident that the marketing strategy will work, and I am deeply moved by the acceptance of the policy by all stakeholders. The Revised Treaty of Basseterre has an A-Z Agriculture sub-regional guide and the OECS Commission has the political will. I certainly look forward to a very robust national and regional consultation series; the remodelling of the technical support in the Ministries of Agriculture in the sub-region to support this project, and the subsequent pooling of the human resource capacity within the country’s and region’s private sector to advance what I consider to be a great cause.

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