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Professor Emeritus, Ken Ramchand wished to revisit the decision to close Caroni and in so doing referred to the social displacement, the blow given to local agriculture and that it is time to take another look at cane with a sharpened look at combining cane with other crops. Prof Ramchand also suggested that we extend our endeavours to the coconut palm and its associated products.
Mr Max Cuffie saw that the closure of Caroni was based on sound economic principles and was inevitable after the cessation of the EU quotas. We can extend Ramchand’s arguments to cocoa, coffee, local downstream chemicals etc. The problem is not the opportunities that others have grabbed from their local advantages, but what is it that has prevented us locally from seizing similar opportunities?
Lloyd Best in his own inimitable style tried to explain; our plantation economy built our society, instead, as is the norm, a society building an economy; the Muscovado Bias in which we export basic commodities, usually funded by foreign investment, and import finished goods; school in pan (as opposed to pan in school) in which creating our own thing from our learning experiences that no one taught us, is the crux of economic development.
However, up to today, few of us and none in government appear to understand this complex self adaptive economy, one in which we can indeed adapt to certain economic crises and challenges. Our history has so constrained us that we cannot adapt/respond to the challenges outside of the plantation to produce interlocking goods and services particularly for export.
Prof Hausmann, in an IDB study of the region, concluded that the skills (read experiences) we have developed do not enable us to move from the sparse global product space to the more dense space where we can make more sophisticated products for a changing global economy.
Hence our historical experiences inhibited the development of our agricultural industry and constrained our ability to respond to current challenges of the uncertain global economy. All of our governments put their trust in foreign investment, particularly so in the energy sector, which provides us with the rents/taxes to keep the local on-shore (import-markup-sell) operating.
Today many economists tell us of the need to have a national innovation system—an interaction among government, the private sector and R&D institutions. We have these institutions represented in our defunct agricultural export industries (UWI, government R&D, Cariri, Cardi etc.) yet we have been unable to take advantage of the local comparative advantages and opportunities to expand our production past the Muscovado Bias. Why?
The ability of an economy to develop, to be sustainable, depends foremost on its ability to adapt to expected and non-expected economic changes. Learning is at the heart of being able to adapt. We do pay a lot of attention to education in T&T but as constructed it teaches us, if anything, how to handle known risks, known situations—ie it is associative learning. This makes us no match for our agile competitors who can learn, invent, be innovative (we are 124/144 in global innovation).
The kind of learning we lack, is knowledge gained by experience and interaction—learning through successes (as in pan) and failures (as in bagasse board). These build on our associative, academic education, and maintain the capacity to adapt in the continually changing economic environment.
When the EU changed its rules the region’s tropical agriculture collapsed, we could not adapt though we knew the challenge was ahead. We do not have the sort of learning that will allow us to adapt, respond, to future and unknown threats, to foresee a Black Swan.
To achieve this state of skill, to develop the advanced skills Hausmann talked about, takes time and a specially designed embryonic economic innovation spiral that can grow into a sustainable economy. The Innovation Diamond I have been championing is one such system.
Mary K King
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