Certainly not good times for manufacturing – Inniss
Minister of Industry, Commerce and Small Business Development Donville Inniss is not satisfied with the current state of manufacturing in Barbados.
Hinting at possible changes to the way incentives are given to the sector, Inniss indicated yesterday that he wanted manufacturers to stop complaining about foreign companies coming in, and to look instead at venturing into foreign markets.
“I am definitely not satisfied . . . that it is still a sector that thrives on incentives from the State, protection from the State, by way of high duty on the competing products coming in. Once that kind of environment continues ad infinitum, it can stifle creativity,” cautioned Inniss.
The minister was speaking to reporters following a tour of Good Time Snacks in Grazettes Industrial Park.
He said he also was not pleased that Barbadians were not fully aware of the range of high quality local products, suggesting that it was possibly an issue of marketing.
The member of Parliament for St James South said he felt “we have somehow slackened up” in encouraging Barbadians to buy local, adding that it could also be a case where people genuinely did not know what was available.
The other challenge, he said, was companies not upgrading their facilities.
“Sometimes you get six companies in the same industry competing with antiquated machinery because none of them has been able invest in new plant and equipment, using the same old designs they have been using all along,” he observed.
Inniss also called on manufacturers to see the entire world as their marketplace and to operate with a “can-do” attitude.
“You can’t sit and believe that your business will grow by leaps and bounds just within a 166 square mile market with 300,000 people. There are many who are perhaps afraid of venturing beyond our shores and step into other people’s market, and then we sit and complain when other people get a little aggressive and come into our market,” he said.
However, Good Times Snacks Director and Chief Operating Officer Andrew Noel said domestic producers faced challenges locally as well as regionally.
He said domestically they were forced to compete with cheaper products and sometimes lower quality products from China.
This, he said, was coupled with high port charges, as well as high costs associated with shipping, partly because of the high costs associated with docking at the Bridgetown Port.
“The companies that deal with freight on the whole have seen in the past few years, a diminished import because of the cost of freight, but what they do is just tack on more freight to keep their bottom line looking good,” lamented Noel, who pointed out that “it actually costs US$300 more to land a 20-foot container in Barbados than it does in Trinidad and it has to pass Barbados to get to Trinidad.”
The Barbadian manufacturer further reported that varying challenges were experienced by his company over the past 34 years which have forced it to cut back on its export plans to Dominica, Jamaica, Trinidad and the United States and Europe.
However, he reported that between 60 to 70 per cent of its production is exported to Grenada, St Lucia, St Vincent and Antigua.
Noel explained that the problem in Dominica was one of receiving payments form “unscrupulous” business people.
In Trinidad, he said, operators were able to change the prices “at liberty”, which he felt was deliberately done to keep Good Time Snacks out of the market.
“One time we were doing Jamaica but there are a lot of restrictions to Jamaica. Being so close to the United States they can get a lot of stuff relatively cheap and in quick space of time,” Noel added.
He revealed that the 34-year-old company was also interested in entering the Miami and Canadian markets, but said there were some unspecified restrictions.
Noel also complained that despite the presence of several regional trade agreements with the European Union, when it came to snacks, only Trinidad and Tobago was qualified to get into the EU market.
However, Inniss quickly pointed out that under the Economic Partnership Agreement local goods could access the EU market “provided they meet the criteria for entering the market”.
Inniss said a strong emphasis was on sanitary and phytosanitary standards, which he said the ministries of health and agriculture were working on. This would include some changes to legislation as well as additional facilities including laboratory.
He also promised to work with overseas partners to enhance trade agreements, pointing out that after years of negotiation, Barbados would “in a couple of weeks time” be signing a deal with Cuba.
Inniss also acknowledged the need for lower cost financing so manufacturers could upgrade their facilities, as well improved regional transportation to facilitate increased trade.
He promised to raise the issue of delays in processing regional applications at the next Council for Trade and Economic Development meeting but said the Barbados National Standards Institute needed to be more vigilant in policing imported items and be “bold enough” to demand better labelling if they did not meet the required standards.
“We cannot just look at what is advantageous to a select few in the merchant class in Barbados but look at what is in the best interest of the entire country,” he said, while pointing to the need to address a number of health related issues while driving down the national health budget.