I have taken note of the comments of Jamaica's Industry, Investment and Commerce minister, Karl Samuda, as reported in The Sunday Gleaner of June 14 and the newspaper's reporting that a trade war looms within Caricom.
"Make no mistake about it. I have signalled that reciprocal or appropriate action to protect the interests of the Jamaican manufacturing community will be taken, immediately," Samuda is reported to have said.
I have taken note, as well, of the column written by former trade minister Claude Clarke in The Sunday Gleaner of June 7.
In that column, Clarke claimed that Jamaican manufacturers 'have been driven into the ground by Trinidadian products benefiting from three cents per kWh electricity and duty-free entry into the Jamaican market' and that there are Jamaican 'workers and farmers who now stare hopelessly into the black hole of unemployment' as a result of unfair trade practices of some CARICOM partners (he really meant Trinidad).
Consult
Might I suggest that before Minister Samuda or former minister Clarke say, write or even think another word on this issue they consult the external trade bulletin of the Statistical Institute of Jamaica.
When they do, they will discover:
Jamaica's imports from CARICOM accounted for 19.68 per cent of Jamaica's total imports in 2008;
That 84.5 per cent of Jamaica's imports from CARICOM came from the mineral fuels etc category;
That Jamaica's imports of goods categorised as non-mineral fuels from CARICOM amounted to 5.04 per cent of Jamaica's total imports of goods categorised as non-mineral fuels in 2008. This 5.04 per cent figure would have included manufactured goods from T&T;
That Jamaica imported 58 per cent of its mineral fuels from outside of Caricom;
That Jamaica's exports to CARICOM accounted for only 2.44 per cent of Jamaica's total exports.
These facts are easily verifiable by anyone who chooses to invest a mere 15 minutes on the Statin website.
Is the threat of 'reciprocal or appropriate action to protect the interests of the Jamaican manu-facturing community' justified, given the statistical evidence from the premium Jamaican source that Jamaica's imports of non-mineral goods from CARICOM comprise less than five per cent of Jamaica's total imports of non-mineral goods?
While the Jamaican public is entitled to expect that Samuda and Clarke would consult the information on the Statin website before threatening 'reciprocal or appropriate action', the gentlemen may be less familiar with US trade statistics.
On the US Department of Commerce website, there is an interesting area called the Foreign Trade Division which reports up-to-date statistics of US trade with the world.
That site reveals the following:
Jamaica imported goods from the United States worth US$2,643.4 million in 2008. This means that Jamaica's imports from the US exceeded its imports from Caricom by 57 per cent.
Jamaica exported goods to the United States valued US$728.7 million. This means that Jamaica's exports to the US were more than 11 times its exports to Caricom.
Idle threats
In light of the above statistics, it might be useful if politicians, former politicians and others stopped throwing around these idle threats of 'reciprocal or appropriate action' that have little statistical basis.
As I have pointed out elsewhere, few Jamaican manufacturers are willing or able to do the work necessary to establish trading relations in T&T.
The Trade and Investment Convention (TIC) is one of the region's premier fora for manufacturers and related service providers to showcase their goods and services to the local and regional markets. Participation at the TIC, which is hosted by the Trinidad and Tobago Manu-facturers Association, is one of the ways in which a company or country interested in selling its manufactured products can establish a presence in the local and regional market. That's because the convention attracts not only local and foreign manufacturing exhibitors but also buyers and distributors from around the world.
Last year, the event attracted 2,158 local buyers and 256 foreign buyers in its ninth year. One would expect, therefore, that if Jamaican manufacturers were anxious to break into the T&T market that there would be a flood of them beating down the door of the organisers of the convention to exhibit their goods and services at T&T's premier manufacturing showcase.
Last year's TIC attracted 81exhibitors from outside of Trinidad. Jamaica was represented by two companies, according to the TIC 2008 final report. Grenada, which is a fraction of the size of Jamaica, was represented by five companies.
There were 16 companies from Curacao at the event, 10 from Costa Rica and 10 as well from El Salvador.
If Jamaican manufacturers were interested in breaking into the eastern Caribbean and Trinidadian markets, would it be one of the least represented countries at TIC?
Do Jamaican manufacturers expect to break into the Trinidad market by having their minister threaten 'reciprocal or appropriate action' or will this be achieved by knocking on doors in Port-of-Spain and attending the trade conventions here?
While Jamaica was represented by two exhibitors, there were 15 buyers from the north Caribbean country at the event.
What is one to conclude by the fact that two of the 81 foreign exhibitors were Jamaican, while 15 of the 256 buyers were from there?
On the issue of the T&T Government subsidising Trinidadian manufacturers, the perceptions in Jamaica (as expressed by Clarke) are also incorrect.
T&T's residential and commercial categories of consumers pay well below the economic cost of supply while the industrial customers (most of which are large manufacturers) pay above the economic cost of supply.
T&T's independent, utility rate-setting body the Regulated Industries Commission, in its final determination in 2006 of the application for a rate increase by T&T's electricity distributor, stated:
"The Government of Trinidad and Tobago has historically provided electricity to the population at below-market prices.
As part of the rationalisation process, the major issue faced by the RIC, therefore, is how to address the impact of the higher prices on low-income households.
"The current levels of electricity tariffs contain a large degree of cross-subsidy, with industrial customers paying well above the economic cost of supply, cross-subsidising other customers to the tune of TT$215 million (US$35 million) in 2005.
Many of these industrial consumers operate in an increasingly competitive environment, typically being subject to national and international competition."
The level of the cross-subsidy would have risen since 2005.
The explanation for the cross-subsidy lies in the fact that in 2006, TT's electricity distributor collected TT$694 million (US$111 million) from 321,139 residential customers who used 1,771,667 (kWh) but that it collected TT$870 million (US$140 million) from 2,549 industrial customers.
Anthony Wilson is the acting editor-in-chief of the Trinidad and Tobago Guardian and a business columnist. Email: awilson@ttol.co.tt