Food on the front­burner

Agri­cul­ture moves to front burner over re­newed fears around food se­cu­rity

Jamaica Gleaner - - FINANCIAL GLEANER - KARENA BEN­NETT

IN­VEST­MENT PRO­MO­TION agency Jam­pro has pushed agri­cul­ture to the top of its agenda as a first step in get­ting for­eign di­rect in­vest­ments, FDI, flow­ing back into Ja­maica post COVID-19. Over the past three years, Jam­pro has largely se­cured in­vest­ments from in­vestors look­ing to en­ter the busi­ness process out­sourc­ing or tourism sec­tors. But with the on­slaught of the COVID-19 pan­demic, the fo­cus has shifted to agri­cul­ture and lo­gis­tics. Ja­maica buys around US$800 to US$1 bil­lion of food from over­seas mar­kets an­nu­ally, a bill the Government has at­tempted to wran­gle down through im­port-sub­sti­tu­tion poli­cies, with lim­ited suc­cess. Jam­pro’s cur­rent fo­cus is not so much about buy­ing less for­eign goods, but find­ing ways to in­cen­tivise over­seas com­pa­nies to set up agribusi­ness op­er­a­tions in Ja­maica. Es­sen­tially, Ja­maica would still be buy­ing from for­eign agri­cul­tural com­pa­nies, but some of that busi­ness would be con­ducted in-coun­try. And the agency is just as keen to iden­tify lo­cal com­pa­nies will­ing to in­vest in scal­able agri­cul­tural busi­nesses. The shift in fo­cus was dic­tated by the pan­demic, which dis­rupted sup­ply chains and ex­posed just how vul­ner­a­ble im­port-de­pen­dent coun­tries are if and when their for­eign mar­kets go into lock­down – as hap­pened in coun­tries around the world. It demon­strated more starkly for Ja­maica that its food and health se­cu­rity could eas­ily be jeop­ar­dised in a pe­riod of cri­sis. “The ques­tion of food se­cu­rity has re­ally be­come more vivid in peo­ple’s

What we want to do now is to find prop­er­ties in Ja­maica, de­cide what those prop­er­ties are suited for, and then go out and look for the right in­vestor

minds. If in­ter­na­tional trade starts to shut down, then we have to eat what we grow, and that has cre­ated greater ur­gency for us to lever­age our idle lands,” Pres­i­dent of Jam­pro Diane Ed­wards told the Fi­nan­cial Gleaner. The re­lax­ing of non-tar­iff bar­ri­ers, which in­cludes quo­tas, sanc­tions, and levies, has also made it eas­ier for agri­cul­tural pro­duc­ers to tar­get mar­kets pre­vi­ously deemed as im­pos­si­ble for ex­port of the coun­try’s goods. Still, the crop vol­umes pro­duced by Ja­maica’s farm­ers fall short of what is needed to fa­cil­i­tate the type of scal­able agri­cul­tural busi­ness that Jam­pro hopes to pro­mote to re­gional and in­ter­na­tional mar­kets. To ad­dress that de­fi­ciency, the state agency has teamed with the Min­istry of In­dus­try, Com­merce, Agri­cul­ture & Fisheries, MICAF, to cre­ate a Na­tional Agribusi­ness Coun­cil, and on Wed­nes­day signed a mem­o­ran­dum of un­der­stand­ing with the Ur­ban Devel­op­ment Cor­po­ra­tion, UDC, which seeks to fast-track the process of iden­ti­fy­ing and fa­cil­i­tat­ing the lease or ac­qui­si­tion of suit­able agri­cul­tural lands by in­vestors. Ja­maica has some 35 per cent of its agri­cul­tural lands lay­ing idle. “What we want to do now is to find prop­er­ties in Ja­maica, de­cide what those prop­er­ties are suited for, and then go out and look for the right in­vestor for that project,” said Ed­wards. “It’s a dif­fer­ent as­pect to our match­mak­ing busi­ness which we were do­ing be­fore. We didn’t have the pack­aged projects and prop­er­ties to take to mar­ket,” she said. Jam­pro’s di­rect tar­get­ing of in­vestors for agri­cul­tural projects is part of a five-year plan to trans­form the plan­ta­tion-based ap­proach to agri­cul­ture to a mod­ern agribusi­ness econ­omy fit for the 21st cen­tury that Jam­pro and MICAF had de­vel­oped even be­fore the COVID-19 pan­demic. It takes into con­sid­er­a­tion cli­mate-smart agri­cul­tural solutions, ir­ri­ga­tion sys­tems and re­new­able en­ergy to re­duce the cost of en­ergy to farm­ers. The pan­demic has made the pro­gramme more ur­gent, es­pe­cially with double-digit de­clines in remit­tance in­flows and the col­lapse of the tourism and travel mar­kets, the top two earn­ers of for­eign ex­change for Ja­maica. Eco­nomic fore­casts for Ja­maica projects that travel and tourism earn­ings will fall by two-thirds to US$995 mil­lion post-COVID from US$3.1 bil­lion pre-COVID; and re­mit­tances, too, will de­cline to US$1.9 bil­lion from US$2.3 bil­lion. As for for­eign in­vest­ment flows, the bullish pro­jec­tion for US$492 mil­lion of in­flows for this fis­cal year, end­ing March 2021, has been read­justed to about US$216 mil­lion. The new postCOVID pro­jec­tion lines up with the FDI flows seen by Ja­maica in the past fis­cal year, which was about US$219 mil­lion. Jam­pro is now in dis­cus­sions with prospec­tive in­vestors, mainly from the United States, in its search for fresh FDI flows. “Up to three years ago, we were not find­ing in­vestors re­ally in­ter­ested in agri­cul­ture, but over the last year we have seen peo­ple re­ally start­ing to fo­cus on the sec­tor. So it is de­mand-driven; but it’s also driven by our vi­sion for the econ­omy,” Ed­wards said. With so­cial-dis­tanc­ing pro­to­cols on busi­ness travel ex­pected to con­tinue into next year, Jam­pro is look­ing to tar­get in­vestors with e-brochures and vir­tual tours of lands that will be up for grabs through the UDC, as well as other pri­vate prop­erty that landown­ers are putting on the mar­ket. Ed­wards also noted that the down­time cre­ated by re­stric­tions in travel has al­lowed the agency to im­prove on its “af­ter-care ser­vices” to re­tain the busi­ness of in­ter­na­tional clients cur­rently in Ja­maica. That has so far has in­cluded sup­port for the um­brella group for the BPO sec­tor, the Global Ser­vices As­so­ci­a­tion of Ja­maica, in its lobby to con­tinue work-from-home ar­range­ments; as well as as­sist­ing farm­ers to seek out new mar­kets – whether re­gion­ally or lo­cally – for their ex­cess pro­duce. karena.ben­nett@glean­erjm.com

FILE Diane Ed­wards, pres­i­dent of Jam­pro.

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