Developing markets for national growth
“The next Progressive Labour Party government will focus its efforts on attacking Bermuda's cost-of-living problem. Our policies must reduce the cost of living across all areas, including healthcare, housing, food and electricity, to ensure that Bermuda is affordable. Our People's Budget will ensure that this urgent issue is addressed” — David Burt, March 3, 2017
I have put forward ideas in previous articles, including in “Where Bermuda can be headed”. I would like to share another idea that may be able to reduce the cost of living, provide jobs for Bermudians and provide national growth. My hope is not simply that one of my ideas will catch on. I would be satisfied if my ideas light a spark that starts a flame as to how we can overcome our present economic condition.
However, before the idea is provided, we should analyse the words above from the Premier. These words were spoken only four months before our last General Election.
At present, there is a high level of disillusionment in Bermuda. The Progressive Labour Party promised to lower the cost of living if it was returned to power. Sadly, we now realise either there was clear deception to get elected or a gross lack of understanding of how to manage government resources for the betterment of us all.
The numerous taxes that the PLP government has saddled the economy with have had a very negative effect on the people of Bermuda; especially the people who can least afford it. These taxes have caused the cost of living to rise dramatically. In addition, retail sales have declined for a 12-month period.
However, the “People's Party” saw no need to provide a tax break to small and medium-size businesses that employ mostly black Bermudians.
At the same time, this same PLP government has provided a tax break to large companies that pay more than $500,000 in payroll tax per annum while small businesses received no such assistance. Didn't the PLP say this was anti-Bermudian while it was in opposition? Is the PLP really the “People's Party”?
By now it should be quite evident that Bermuda is in an economic slump. The business confidence index, retail statistics and real estate values reveal that. It should also be clear that we have no chance of reversing this without being innovative and proactive.
As we have come to believe, our economy is not going to automatically bounce back because of the vibrancy of the American economy. In fact, the US economy is hitting record highs, but our retail sales and real estate values are in continuous decline.
Although I am critical of the Government when warranted, I also like to provide solutions, so let's get back and tease out this idea. We are a nation that invites the world to come to us via international business and tourism. We are constantly trying to attract foreign investment and expert foreign labour. At the same time, we travel the world to purchase consumer goods and services, including expensive services in higher education and intensive healthcare. However, our thinking is confined in an area where it is now a requirement to be more outward-focused and visionary by developing business opportunities in foreign markets.
Starting with the basics, like all other nations we require food. There are few among us who have not noticed the significant increase in the price of food. However, there is no national priority to produce our food elsewhere and import it back home. Why couldn't we acquire tens of thousands of acres of fertile land in the Caribbean, South America or North America to produce our rice, corn, potatoes, vegetables, fruit and other staple food items that we consume? Surplus crops could be used to supply other markets as well.
We import and consume vast quantities of chicken, beef and other meats, but we have never endeavoured to get into the business of producing these commodities abroad to supply our needs back home. We are surrounded by water and consume large amounts of fish, but we have not produced a thriving fishing industry to the scale that we could. We have always imported these products from other foreign-owned businesses, but we have not considered it in our national interest to import these products from businesses we own in other jurisdictions.
Bermuda does not need to see our domestic market as its only source to meet its labour needs. Successful businesses abroad could be opportunities for Bermudians in some capacity of the investment, operations and production chain.
There are also benefits with developing relationships with other governments and private businesses in other jurisdictions as well as developing private businesses in our own island.
Many other considerations, including infrastructure, and regulatory and capital investment requirements, would have spin-off effects that broaden the horizon of our local government and infuse our people with the desire to pursue these opportunities.
History reveals that at one time Bermuda used to supply vegetables and other produce to overseas territories. We were pioneers at mining salt in the Bahamas and Turks & Caicos. Over time, we ceased doing that, but now may be the time to look at interesting ways to improve our economic fortunes.
China, the Gulf states and Korea are a few of the leading territories that directly invest in other countries for their national food supply back in their home countries. This is not a new idea, as it has been occurring for many years.
Inevitably, there will be those who will see obstacles as opposed to opportunities. So the conversation will likely turn towards the transportation limitations of importing the goods produced back to our home market. This may just be an opportunity. The Caribbean is notorious for significant, cross-border trade with other Caribbean nations. We should see fit to make it a national priority to become innovative in creating the means to make this viable.
It is often said that necessity is the mother of invention. This should mean that we will endeavour to examine opportunities to change the course of how we do business and to source new opportunities. We may be late to the game, but at least we can look at how others have done it, learn from their mistakes and profit from their successes. This may be an option to add positive value to our economy.
The worst that can happen is that we run into a brick wall. We would be richer for the experience of taking a leap of faith where we have not done so before to supplement our food supply and potentially reduce the cost of our food. But to come to that conclusion without serious assessment of the possibilities when our fortunes are declining at home is unforgivable.
• Vic Ball was a One Bermuda Alliance senator from November 2014 to July 2017