Impose a moratorium

Time for a moratorium in agriculture.

This is advocacy for a moratorium many consider an absolute imperative to build back this “backbone” industry of our nation. No doubt, some would call the measure draconian and extreme and raise red flags about the danger of sparking a “beggar-thy-neighbour” trade war. Indeed, moratorium is extraordinary but we are living in extraordinary times.

The moratorium would be a temporary ban on select categories of imported goods that compete with domestically produced agricultural goods and agriculture-based products. Import substitution (IS) would conserve scarce foreign exchange and agriculture and agro-processing industries would be protected from foreign competition as they build productive capacity.

In the national crusade to recapture some modicum of the “old glory days” of agriculture, the moratorium would be the last resort to circumvent a stream of failed strategies. We have tried everything: moral suasion, recruitment of the youth, financial and technical support, subsidies, supply chain management, the current Made-in-Grenada and Buy-Grenada Adventures. Nothing seems to work.

Having almost exhausted all options, we now embark on grand scale commercialisation of government estates to harness the national “food dividend”. However, praiseworthy and impressive as it is, the prognosis for this latest venture remains dubious. Still, positive outcomes could be achieved with a moratorium support mechanism backing up the initiative.

A moratorium impact is immediate relative to tariffication or quotas. Successful moratoriums with IS contingencies have given “food sovereignty” and export capacity to countries with macroeconomic structures and demographics similar to Grenada including Dominican Republic in CARIFORUM and Taiwan.

During the early 2000 decade moratorium measures reduced Jamaica’s food import by 20% in just two years.

A moratorium works like shock therapy to a comatose patient and, unless carefully and clinically applied, it could backfire. It would not be business as usual setting up a moratorium in Grenada and making it work. It requires changes in mindset and a new “food culture” in a nation with die-hard consumption buying habits and addiction to foreign goods.

Getting it right requires front-loaded mitigation policies, some “soft landing” incremental measures, and a road map compliant with multilateral mandates.

First, the moratorium must be compatible with WTO, CARIFORUM, CARICOM, OECS, and EU-ACP agreements. Fortunately, the 1994 GATTS/WTO agreements of Article XIX on waivers, safeguard mechanisms, and escape clauses allow “special and differential” measures to protect domestic industries.

Also, invoking Article 164 of the CARICOM Treaty, the COTED Council for Trade and Economic Development permits Member countries to take measures for achieving industry competitiveness.

Trade policy specialist extraordinaire, Dr Patrick Antoine, could spearhead the teamwork, expertise, and negotiating skills acumen to make the case for these derogations.




Second, we source financial, technical, and capacity-building support from global institutions. IMF Compensatory Financing Facilities assist low-income countries at risk from dependency on oil and food imports.

The UK Department for International Development supports global poverty eradication. The IFC Corporation of the World Bank Group finances public/private sector initiatives. IFAD is the international fund for developing agriculture food security in underdeveloped countries.

Thirdly, a study would identify imported agricultural products that compete with products produced or processed domestically. It includes the select category of traditional food crops, exotic non traditional fruits and vegetables, and meat stock targeted for mass commercialisation. Also, pilot experiments have successfully grown certain temperate crops locally under controlled “greenhouse” conditions.

Fourth, and critical to the moratorium success, domestic producers and stakeholders need transition time to build capacities for domestic demand before the moratorium is implemented. Structural rigidities, supply constraints, and price hikes could create market distortions and dead weight inefficiencies that destabilise the whole venture.

Fifth, we switch renewable energy initiatives to “maximum overdrive” to minimise long-run production costs, examples, wind, solar, and biothermal energy, and we engage functional partnerships with Brazil, Venezuela, and China. Also, Europe supports “green production” everywhere.

The sixth priority concerns regulatory gatekeepers, the police, customs authorities, and the coast guard. Without constant vigilance and monitoring moratoriums are compromised by underground economies, black markets, and contraband smuggling, and the FAO reports a 25-percent production loss to praedial larceny. Law enforcement prevents or minimises breaches and violations.

The moratorium brings on board tripartite players of civil society, trade unions, private sector, government, all vigorously promoting the initiative. Education reforms make agriculture a compulsory study at all institutional levels. Curricula content focuses the global dynamics of organic and inorganic farming and the economics of agriculture and related sciences.

Work study programs provide students with hands-on scientific farming experience. And the mass media disseminates moratorium information. Moratoriums are imposed by developed and developing countries. In 2012 Indonesia banned all fruits and vegetables to protect its domestic industry. The US currently conducts a moratorium on all marine mammals and mammal products.

In 2013 European Union ends a 10-year moratorium on GMOs, genetically modified food imports. And Peru has a 10-year ban on genetically engineered crops, seeds, and plants.

A statistical econometric model can be developed to evaluate the socio-economic welfare and efficiency gains of the moratorium. We could revolutionise agriculture in Grenada. But it takes political will.

Jay Bruno    

 

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