Questions pertaining to manufacturing usually arise when there are perceived problems in the Barbados economy.
Manufacturing is treated like a conversation piece by too many. It is not sufficient to simply fill a space or to sound knowledgeable on such a critical matter that has such profound implications for Barbados.
The country is a traditional small open economy with a high propensity to import. Analysis of the manufacturing sector indicates a contribution of seven to ten per cent to gross domestic product.
The greater the output from manufacturing, the less dependent the country is on other sectors to both create jobs and earn foreign exchange. More emphasis on manufacturing does not mean less emphasis on other sectors.
When an analysis is made at the sub-sector level within the overall manufacturing sector, it is evident that significant opportunities exist for additional job creation and foreign exchange earning.
This can be achieved through capacity expansion, capacity utilization, or both. There are issues to be resolved both from the firm and policy perspective. The private sector, which has been traditionally cautious and conservative, continues in this vein.
That being the case, manufacturing strategies aimed at improving processes and quality, and reducing cost to the final consumer are not widely adopted. Manufacturers need to move away from the commercial model of charging what the market can bear.
There is a dynamic in Barbados that limits the manufacturing sector’s expansion.
The fundamental core of this dynamic is the belief that manufacturing as an activity does not matter and will never be viable. The view is widely held by people at all levels of the policymaking apparatus.
It will never be revealed in speeches as this is not politically correct, but one easily gets a sense of it over drinks or when interfacing with developmental organizations.
It is because of this dynamic that manufacturers have to fight for every opportunity to do business in Barbados. One specific case in the furniture and woodworking sub-sector revolves around supplying the hospitality sector.
Consultants, who are part of this dynamic, will argue that local companies should be given limited opportunity to supply this sector. This short-sightedness has is part brought Barbados to the point of extreme agony each time there is a contraction in the world economy and the “other” major sectors are negatively affected.
More emphasis and support is required for the manufacturing sector in 2012 if it is to make a more valuable contribution to national development.
The dynamic has to be such that companies are serious about process improvements, quality improvements and reasonable cost offerings to the final consumer.
Policymakers must ensure that companies are given the opportunity to do business, especially here in their home market.
