Private sector must lead

With countries across the Caribbean ravaged by the COVID-19 pandemic, Executive Director of the Caribbean Export Development Agency, Deodat Maharaj, says that going forward the private sector must play a greater role in regional economies.

In a recent interview with The Barbados Advocate, Maharaj said COVID-19 has laid bare our pre-existing vulnerabilities as well as reinforced the need to diversify into new sectors, new products and new markets. As such, he said it is imperative that steps are taken to change course, sooner rather than later.

With that in mind, he maintained that the private sector has to play a central and leadership role in the economy to generate jobs, and facilitate the growth and prosperity of Caribbean people. To that end, he contended that the role of the State will be to create an enabling environment for business to flourish and thrive.

“We were primary producers of one export product, or one main sector to earn foreign exchange before COVID-19; it is the same now. We are arguably the most highly indebted region on the planet; post COVID-19, we’re in the same situation. Thirdly, and this is vital, the State was the biggest employer pre-COVID-19 and it remains the biggest employer in most countries in the region post COVID-19. But, what is clear is that once you have one primary sector that gives most jobs and provides most of the income, you will continue to be vulnerable, whether it's a hurricane, or pandemic. I think that COVID has exacerbated pre-existing vulnerabilities, but what it has also done is sent a sharp message that business as usual cannot continue,” the executive director stated.

Additionally, Maharaj said that the pandemic has forced countries to embrace technology and digitalization, at a much faster rate than they would have ordinarily had to do, in order to compete more effectively. But, he said there is still more work to be done in that regard. The Caribbean Export head said while it is now possible to purchase more items online, many Caribbean business people still do have websites, which could be prohibitive.

“What is going to happen I think, is that people who are pushing the new frontiers of business, those who are going into renewables, those who are embracing business outsourcing, health and wellness, those new economies and those businesses will flourish going forward and existing businesses, if they don't embrace technology, and this new way of doing business, they will be in peril,” he stated.

Reflecting more on the private sector, he said while the larger businesses in the Caribbean will be able to adjust and adapt to the new normal, the micro, small and medium sized businesses, which account for about 60 percent of the employment, will need help.

“It is really important for them to get support from government, and for other partners to pay attention to them, because they are the ones you want to make sure can have a seamless transition into this new era and ease of doing business,” he added.

Maharaj said that Caribbean Export is doing their part, where financing for such businesses is concerned. He noted that just recently a direct assistance grant programme funded by the European Union was approved, where businesses, which apply, can receive up to 15,000 euros on a non-reimbursable basis to support their business.

“But I don't think that is sufficient, obviously, and therefore what is really important is that across the region in regional institutions, such as the Caribbean Development Bank, and others, they have an important role to play in ensuring that precious finance for small and micro businesses is really readily available. And of course, government has an important leadership role to play to ensure that happens,” he maintained. (JRT)