By Zhivargo Laing
Dr Shelton Nicholls, former deputy director of the Central Bank of Trinidad and Tobago, was right when he said Caribbean countries needed to ensure economic growth strategies address the current challenges as well as take us along a sustainable development path.
Dr Nicholls added “short-term tinkering alone with our macroeconomic and financial environment … may not give us the fillip that we really need to push our economies out of the current stasis. Our survival will ultimately depend on finding several engines of growth which together would give us enough of a diversified base to remain on a sustainable growth path.”
But who will take up this task? If Caribbean governments lead this charge, then success is unlikely.
The little transformation in Caribbean economies within the last 30 years was born more out of accident or desperation than deliberate government policy.
A report from the May 30, 2012 ECLAC Round Table pointed out that most of the region performed well in the first phase of independence moving into the services sector, but perhaps relying too heavily on the tourism industry. However, economies slowed and have not diversified sufficiently to withstand the buffeting from the 2008 recession.
The governments of the Caribbean, as well-intentioned as they might be to lead a transformation of their economies, cannot succeed because politics tends to be their full-time preoccupation, with the goal of staying in office being often better served by short-term thinking than by the difficult decisions that frequently accompany long term considerations.
Development and transformation are definitely long term objectives.
It takes time to see the huge return on investment from sound education policies, infrastructural strengthening, robust business support programs, comprehensive public health services and non-pork barrel, patronage-driven fiscal policies.
Even with the existence of courageous political leadership, any push toward economic transformation in our region will be led by Caribbean entrepreneurs. The opportunities for profitable gains that exist in our region will be more keenly identified and more vigorously pursued by full-time business people rather than by full-time politicians.
New businesses, new industries, new products, new services, better products, better services seldom arise because governments intend them to. Rather, they emerge because ambitious individuals driven by creativity, innovation or profits pursue them.
What, then, can be done by governments to assist the transformation process in the Caribbean?
The most useful thing a government can do is to stay out of the way and to focus on building an enabling environment for the entrepreneurs who will drive the transformation.
They should also help business gain access to management, legal, accounting, marketing and technological services.
They must do this in a way that helps to lower the risk profiles of small- and medium-sized businesses so they can enjoy greater access to the large pool of capital available through traditional, venture capital and angel institutions.
Additionally, they should integrate business education into their schools’ core curriculum to increase the body of persons knowledgeable and interested in business in the future.
To fuel transformation, the private sector has to advance with greater awareness, strategic intelligence, global insight, technological savvy and networking capacity.
The region’s entrepreneurs must think big, systematically and pragmatically. They must also discipline themselves to undergird their businesses with the kinds of administrative disciplines that reflect global best practices.
Above all, they must exercise the defining trait of entrepreneurship – tenacity. All business is fraught with challenges. Economic transformation increases such challenges enormously and only the tenacious will see the promise land.
A number of Caribbean businesses have already proved themselves up to the task such as Sandals Resorts, SuperClubs, ANSA McAL Limited, and Goddard Enterprises Limited. Many more can join them and when they do, the transformation and growth of which Dr. Nicholls spoke will take place.
Zhivargo S Laing, former Minister of State for Finance with the Government of The Bahamas, is an economist, consultant and motivational speaker.