Saturday, April 13, 2024

NOT ALL BLACK AND WHITE: Time to end of import substitution


Share post:

IF SOMEONE REALLY WANTED to write a fascinating book about the role of import substitution in the growth of Barbadian business, they need look no further than Chefette Restaurants Ltd and the Nation Publishing Co. Ltd.

Born just a year apart (Chefette, 1972 and Nation, 1973), both took up the nationalistic call of the times: The need to build home-grown institutions.

Chefette challenged the then mighty Kentucky Fried Chicken, substituting local recipes and flavours for those still unknown “eleven herbs and spices” concocted somewhere in the Delta by an elderly fellow in a white suit.

For its part, the NATION challenged the Advocate-News, substituting the mostly foreign stories imported by that newspaper with mostly local stories written by its reporters.

People who were not around at that heady time for journalism might have a hard time believing there was a local newspaper here that, shall we say, “favoured” foreign news over local.

The growth of these two companies was historic. They each had the equivalent of a Tom Adams or Errol Barrow (take your pick) at the helm for a very long time (one had the equivalent of two at the same time).

Just by being true to their mission they made history and expanded consumers’ choices; also, by giving those consumers better and more personal service, they became genuinely popular (and remain so); and they fortunately took many decisions that affected the wider society for the good.

They are all the more interesting because they were enterprises led by men and women, not angels and saints flown down specially for the purpose.

But what they accomplished has been unbelievable. Even those who watched it all unfold can now so easily take it all as given, unless they pinch themselves and say, “Remember when…?”

I see these two companies as being emblematic of a small group of import-substitution companies which made it to the big leagues here and are still making a huge contribution to the local economy, including Hanschell Inniss Ltd, Bico Ltd, all printing companies, some large farming companies, agro-processors, and the biscuit and pasta companies.

To some extent, all these companies, and several more, may have benefited over the years from specific government incentives aimed at companies engaged in import substitution, and we can argue where in each case such policies may have helped them succeed.

But times have changed dramatically in the last several years, and in my view, the abolition of punitive tariffs or official permission for imports is what our economy needs right now.

Under the European Partnership Agreement (EPA), which is governed by the World Trade Organisation, we have already agreed, as far as I know, to the removal of any excessive tariff, franchising or licensing barriers, which have formed the nuts and bolts of the import substitution era.

That they still persist to this day may be the result of lobbying or due to the long phase-in period for the total EPA package.

But in my view, these barriers, even where they are still the law of the land, are hindering new forms of investment from taking root.

All over the world, local and visiting consumers alike are demanding more choice and variety than ever before. But our country’s leaders are still beholden to an outdated policy which may have been needed when Barbados was a much smaller market than it is now, and when the mighty oak trees of today were just newly-planted saplings bending in the wind.

Patrick Hoyos is a journalist and publisher specialising in business.


Please enter your comment!
Please enter your name here

Related articles

Iran launches retaliatory strikes toward Israel

Iran has launched a wave of retaliatory strikes toward Israel, fueling fears of regional escalation following an apparent Israeli attack...

T20 World Cup trophy in Barbados

The countdown to the start of the 2024 the ICC Men’s T20 Cricket World Cup continues. Today marks 50...

Mother’s plea: Come home

“Donisha, I miss you, come home,” cried heartbroken mother Diana Cumberbatch. That was all she could manage before collapsing...

Former child star Jaleel White breaks his silence on ‘Quiet on Set’

At the age of 12, Jaleel White was cast as lovable nerd Steve Urkel on the ‘90s sitcom “Family...