Import tariff discussions In Barbados include discussions on increased local procurement
15 July 2013
It has been announced in the Barbados press that consultations between the Barbados government and fast food establishments such as Subway and Burger King are to take place to discuss import tariffs levied on food imports for their operations. The consultations will include discussions on the scope for expanded use of locally produced tomato, cucumber and lettuce as well as locally processed meat.
The Barbados Minister of Industry, International Business, Commerce and Small Business Development, Donville Inniss, expressed confidence that the local manufacturing sector could meet the requirements of the franchise operators for their processed meats, not only in Barbados but across the Caribbean region. However, he noted that such changes “cannot happen overnight”, and expressed the hope that “once the process is allowed to work” such an expansion of local production would be possible. The Minister noted how local agricultural producers are already “able to provide the franchises and distributive sectors with a wide cross-section of vegetables”.
In Jamaica, meanwhile, the Jamaica Broilers Group (JBG) has announced that it is investing J$300 million (€2.27m) in a new meat processing plant to produce chicken, beef, pork and even processed fish products. The new facility, which will replace and expand an existing facility, is to include “a dressed poultry facility and scope for the production of a range of value-added protein products… to meet the growing and diversified needs of its consumers”. This includes the capacity to produce consumer-ready products such as “chicken nuggets that are currently imported”. The design of the facility is being developed in association with one of JBG’s largest customers that has operations across the Caribbean, in order to facilitate exports across the region.
The new plant aims to produce to international quality standards (ISO 14001 and ISO 9001). However, local press reports in Jamaica have highlighted the need for a reorganisation of food safety and regulatory standards structures in order to improve the efficiency of the resources deployed. It is argued that currently responsibilities are spread across “several different agencies”, with some agencies suffering from a “substantial lack or shortage of resources”, leaving them unable “to offer timely product reviews and registrations” or “to police the market place”.
Editorial comment
Efforts continue in Barbados to initiate a debate on the local procurement policies of multinational food sector franchises, linking these not only to investment decisions but also to a review of tariffs on particular items (see Agritrade article ‘ Better information on retailer plans sought to boost sector development’, 18 May 2013). This can be seen in efforts to strengthen the functioning of local supply chains, so that areas of growth in the tourism and food service industry give rise to growth in local agricultural production. It is recognised that this cannot be achieved overnight, but will require the development of closer dialogue between foreign multinational chains and local agricultural producers.
However, the aspirations of different national producers to develop processed meat products for food franchise chains that operate across the Caribbean region highlight the need for coordination of government initiatives. An absence of such coordination could put multinational franchises in a position to drive down tariffs levied on certain of their inputs, as part of deals struck to expand local production, not only for national but also for regional markets.
The important potential role of harmonised national standards and verification systems in facilitating investment in value-added processing to meet the needs of expanding multinational food franchises across the Caribbean cannot be overestimated. Shortcomings in national capacities “to police the market place”, and a lack of confidence in neighbouring countries over the effectiveness of national controls, could lead to efforts to promote local value-added processing to serve the regional needs of expanding food franchise operations being undermined.
Once again, a harmonised approach would appear to be essential. Efforts are already in progress: at the 36th meeting of the CARICOM Council for Trade and Economic Development (COTED) in May, there was agreement on:
- a regional standard for rice;
- the elements to be included in the framework on consumer protection in the area of harmonisation of policies and procedures;
- “the importance of the Caribbean Agricultural Health and Food Safety Agency (CAHFSA) in ensuring” that trade in food and agricultural products is developed “in a safe and healthy manner” across the Caribbean.
Getting to grips with implementation issues at multiple levels will, however, be critical to the effectiveness of these regional agreements.
