Saturday, June 30, 2012

Imports, Financial Crisis, Bailout and Hennessy

Import and Destroy
Kingston-Wharves, Imports Only Wharves- Exports not Allowed!!
Some time ago in 2009, the then Minister of Agriculture declared that fertilizer from Jamaican companies was too expensive and as such Jamaica will import/buy fertilizer from American sources, this to me is a very anti-Jamaica and an anti-Jamaican business position for our Government to take because it is not like fertilizer was in short supply and we must increase short term supply to the local market and I do understand the need to keep the agricultural cost of production down and inflation in check. What was missing from the minister was any sort of analysis as to why the local price of fertilizer was so high, we heard nothing about the Ministry trying to engage fertilizer producers, trying to find out why prices are high and how the Government can help to reduce cost and pass lower prices on to the consumers, no long term plan of action. The Government’s position then was to undercut local manufactures, flood the market with lower price fertilizer and drive local businesses out of the market, in other words they were not working with the companies but working around them.This type of “Kick Weh Yu Foot” (Kick away your legs from under you) style of Governing must end since it does not benefits local manufactures.

At a time when all Governments around the world was trying to encourage their citizens to buy goods and services from local companies, thus allowing these companies to expand production and increase local employment, our Government was doing the opposite by overlooking local companies and buy from overseas companies. The American Government implemented bailout plans with a buy America clause attached and the Jamaican Government also implemented a bailout plan with a "buy American clause" with no intention of bailing out local Jamaican companies, it seems the aim of the Jamaican Government was to promote American companies and increase American Employment at the expense of our own.

The proper course of action is not to turn our backs on local companies but to figure out a way to help these local companies survive, to take root and satisfy local demand. Farmers need fertilizer and we have local companies who employ local people to make fertilizer, the government needs to figure out a way to get local fertilizer from local companies to our farmers at an affordable cost. In this case we need a win, win solution not a win, lose one. It is the job of the Jamaican Government to encourage the growth of Jamaican companies, encourage the consumption of Local goods and services in order to increase local employment and increase tax revenues for schools, roads and health care etc.

Our Government is so quick to give overseas companies tax break for operating in Jamaica while totally overlooking our homegrown companies. We sit around day in day out trying to encourage overseas companies to come to Jamaica and invest, while overseas Governments are trying to figure out a way of preventing their companies from going overseas. The American Government will give over a trillion dollars to American companies trying to prevent them from going out of business, if companies go out of business, people become unemployed and the US unemployment rate is about 8.0% and growing every day.

The United States currently pays around $20 billion per year to farmers in direct subsidies. Many of America’s economic sectors are in fact subsidized by the tax payer, the richest industries get the biggest subsidies, starting with finance and Big Energy, Notably, 56 percent of the total tax subsidies went to just four industries: financial, utilities, tele-communications, and oil, gas & pipelines. These people are certainly not playing by the same rules they created for us and force us to follow, they go on and on about the free market but what they say and what they do are two completely different things. I am not saying that the Jamaican Government should start shelling out cash willy nilly to every Tom, Dick and Harry with his or her name on a business card, far from it but before we cut the legs from under these companies we should at least try to figure out what problems they are having and why.

This Global Financial Crisis could have been and still can be a blessing in disguise. It is the perfect opportunity for the Government to embark on the mother of all campaign to promote local consumption and production of goods and services, a holy crusade of all things Jamaican, eat and buy Jamaican as a way to reduce the country’s need for loans. The answer to Jamaica’s problem before, during and after this financial crisis is to buy into all things Jamaica, we need to reduce our demand for foreign currency, increase local production and consume local output. A farmer might express the need for cheaper fertilizer but what is happening to the fertilizer company is also happening to the local farmers, importers are also kicking away their legs from under them by importing cheap food.

Imports Gone Wild
Jamaica imports in excess of  US$800 million worth of Agricultural Produce each year, most of which is already grown/produce right here in Jamaica, our total food import bill is US $1,000,000,000 (Billion) per year.Just take a look at a small sample of the madness that is taking place in our country:
  • JAMAICA'S FOOD import bill continues to spiral out of control, jumping by US$100 million in 2011 to a staggering US$930 million and in 2012 was US $1,000,000,000 (Billion). 
  • Jamaica, land of wood and water, Imports $3 billion worth of lumber annually. The farm owner Dalkeith Hanna said,when he first started planting the trees, the cost was 90 cents per square foot for lumber, but in less than two decades the cost is now more than $90. He noted, however, that he still has been able to sell his locally grown lumber at a cheaper cost than the imported wood.
  • 93% of Onions consumed in Jamaica were imported in 2009.
  • Jamaica imported US$8.4-million worth of banana chips, up from US $3.7 million in 2010, so it seems Chippies and St. Mary Banana Chips is not enough anymore.
  • Jamaica imported 70 per cent of ginger in 2010.
  • Jamaica Imported Pepper mash from the Dominican Republic although we produce the best scotch bonnet pepper, the finest-tasting in the world.
  • Jamaica importing in excess of J$8 billion worth of tomato paste each year.
  • Jamaica’s import bill for Irish potatoes decreased from US$4 million in 2008 to US$2.6 million in 2010.
  • However Jamaica imported US$15.1 million potatoes chips, wedges, and fries in 2010.
  • Jamaica supply only 15 per cent of Goat meat on the local market.
  • Jamaica imported 1.3 million kilogrammes of goat meat, valued at US$5.2 million, in 2010, the country needs approximately three million goats to attain self-sufficiency.
  • Jamaica Imports Concentrates costing J$1 billion l
  • Jamaica imports orange concentrate from the United Kingdom of Great Britain, a country that does not grow oranges.
This is the low down regarding Imports, members of the political class, their family and friends are the "Art Vandelay" of the importing business they are the ones getting most of the import licenses to undercut and destroy local production in Jamaica.

Import and Tax Waiver Abuse
Our Political class knows no shame, to continue this insult to injury here is a very small sample of some of Import Waivers granted to friend and company of the political class. Both the Import and Tax waiver system have been subjected to constant abuse, a lot of the Imported items being waived are products that can be grown very easily, right here in Jamaica and is in fact grown right here in Jamaica. This abuse represents the political class giving the farmers and the tax payers of Jamaica the proverbial middle finger. The total value of this very small sample of Import Tax Waiver comes to $29,032,642.42, this represents revenue that should otherwise have been use to fix schools or buy text books, buy medicines for the public hospital, fix the roads or pay down our national debt.

November 2011
1 Tout Pret Distributors Additional Stamp Duty (ASD) waived $561,486.28 (importation of red kidney beans)
2 CJ's Discount Store ASD waived $950,721.91 (importation of red kidney beans)
3 Fresh and Direct Limited ASD waived $416,970.89 (importation of red kidney beans)
4 Chas E Ramson ASD waived $789,014.08 (importation of red kidney beans)
5 River Raft Limited Total tax waived $83,097.67 (importation of rafting gear)
6 Jamaica Football Federation Total tax waived $101,220.09 (importation of refereeing and coaching course material)
7 Jamaica Olympic Association Total tax waived $4,573,010.53 (importation of wrestling mat, gears)

December 2011
1 Jamaica Boat Cruises Total tax waived $106,142.16 (importation of snorkels, fins, tie straps etc.)
2 Howard L. Hamilton Total tax waived $3,216,558.24 (importation of 14 horses for breeding)
3 Robert S. Dabdoub Total tax waived $838,919.25 (importation of one horse)
4 John Ramnon Total tax waived $713,688.43 (importation of one Rand Roller)
5 West Portland Development Fund/Daryl Vaz Total tax waived $215,453.81 (local purchase of one 20ft container)
6 Canjam Trading Total tax waived $1,223,418. 57 (importation of one container of red kidney beans)
7) David Wright Total tax waived $38,692.92 (importation of one chainsaw)

January 2012
1 Major Dionne Sinclair Total tax waived $252,601.00 (importation of personal effects)
2 Douglas Vaz Total tax waived $1,120,080.34 (importation of 2012 Honda CR-V)
3 Tastee Limited Total tax waived $4,824,411.12 (importation of beef trimmings)
4 Caribbean Producers Limited $9,007,155.13 (importation of beef cuts)

Jamaica signed an Agreement to reduce customs duties on EU imports
In 2008 Jamaica and 14 other Caribbean states signed an agreement with the EU to start the reduction of customs duties by January 2011, but only six countries have so far complied. Read More: EU border tax threats 'serious issue' - The Sunday Gleaner

We Jamaicans know good and well what will happen when a stronger force engages a weaker force. Normally the weaker party gets pushed over the cliff in a life of poverty as the stronger countries enforce their will on us. European agriculture and manufacturing is highly mechanized and subsidized by their Governments. This is not free market there is nothing free or fair about the global market place. These concepts and rules were put in place because they give first world countries the advantage, they occupy the position of sellers and poorer countries stagnate in the position of borrowers and buyers. Take for example Britain’s Agriculture sector; it is highly mechanized producing about 60% of their food needs, with less than 1.6% of the labour force (535,000 workers). The EU spent €53bn (£46bn) a year on agricultural development and direct subsidies to farmers, 45% of the EU budget went to farmers as direct payments, so no wonder they want us to sign an agreement to lower tariff on EU imports, it is a win, win situation for Europe. Protectionism is alive and well in the First World, they protect their industries from competition, they subsidize the hell out of it however when Third World countries employ any sort of protectionism First World countries call it corruption.

As a Jamaican lots of questions comes to mind regarding this agreement:
  • How are these trade agreements made?
  • What was the deciding factor?
  • Were they feasible in terms of protecting local markets?
  • How does the EU negotiate similar agreements that require them to lower their tariffs on imports?
  • What was going on /said during these negotiations, what was our Government thinking?
  • Were we threatened in any way? Did they threaten to withhold loans, IMF money or the shipments of ML-250 Benz, French wine and cheese?
  • Was a gun held to the Minister’s head or was his child kidnap by EU agents thus forcing him to sign this agreement?
  • What were they going to withhold if we did not sign it because this seems like an agreement that can only come from force or our Governments are made up of mentality retarded people?
  • Did the Government members get a bribed? Did the EU made offer of huge sums of money and promises of châteaux’s in the French countryside and a supply of ML-250 Benz for the family and friends of our Government members? 
I am totally confuse about this, our government jump on a plane travel to Europe and sign an agreement whose only benefit if to flood our already flooded markets with more cheap foreign goods that we will purchase using the money we borrow from the EU and I am sure at the expense of our local companies. 

Jamaica 50 Hennessy
I would like to know just how much Hennessy Jamaica imports and consume for Maurice Hennessy to personally fly to Jamaica and deliver 24,000 Hennessy VS, in commemoration of Jamaica's 50th anniversary. I remember a sales person in duty free at the Norman Manly airport trying to convince me not to buy the Appleton 21 but to purchase a bottle of Hennessy instead, at which point I asked her if I looked like a semi literate dancehall DJ. I have been told that huge quantities of Hennessy is consumed in the dancehall and clubs nightly by the so called suffering masses who cannot afford the extra 20 Jamaican dollars on a beef patty.

Reparations, Corruption, Financial Crisis and Bail Out!
I have never given reparations from Britain much thought, I am neither here nor there on the subject, either way I do not care since I do not see how little Jamaica can get Britain to hand over what Member of Parliament and a fighter for reparations Mike Henry calls “Cold Hard Cash”. One argument against reparation put forward by some Jamaicans, states that, if Jamaica got reparation money we will squander it, as opposed to what? … Borrowed money? We squander that anyway but at least with reparation money we would not have to repay the money, pay interest on it and maybe we could pay back our past debts, wiping the slates clean. More than likely we would use the money to buy imports from America and Europe, more wine, cheese, SUVs, you name it the sky is the limit, so it may be advantageous for Britain to pay reparations, ask the other countries to chip in, your economies will grow as a result because there is no limit to the amount of rubbish Jamaicans will import if they had “Cold Hard Cash”.

To a person like Mike Henry and my Aunt J reparation is not a loan or handout, they are not begging anything, it is money owed that should have been paid that was not, it is money owed for hundreds of years of injustice where some people’s development was achieved at the expense of others, on the backs of others. The pro-reparation people look at slavery like the Big Bang, an instant explosion of wealth creation in space and time that ripples out from the point of origin, compounded wealth that transcends time and generation. The benefits of which is still being felt by Europe today. However the negative effects of this Big Bang is also being felt by descendants of slavery, its like being forced to create the sun but not allowed to enjoy the full glory of its warmth and light and then told to pay for a glimpse at it. The Bishop of Exeter kept 655 slaves until the time of the Abolition of Slavery Act 1833, when he received £12,700 in compensation. Again I am not an advocate of reparation nor am I against it but if it was given I would be the first in line.

On the subject of Bailouts however I realize that there is no limit to the amount of bailout the EU and other first world countries get, when they get bailout the world seems happy, the stock markets goes up. Billions of Dollars/Pounds/Euros is thrown at them on a daily basis, most recently Spain asked for and got $126 billion bailout not to mention they can say the word bailout whenever they want. However if Jamaica even whispers the word “bailout”… Then we are immediately classed as worthless, looking for handout, with cries of embarrassment and this from our own people, as was seen when the Prime Minister used the word bailout in an interview once! It seems we are the only ones playing this game as the world is in a completely different tournament, being held to different standards.

When it comes to pure Greed and Corruption nothings beats Europeans and the United States of America. I have never seen anything like it while they hold the people below them to a different standard. Western Europe is the worst by far, what they do is disgusting and what they say is Hypocritical and it disgust me but they are suppose to be civilize and we are nothing but savages.

The reactions of most Jamaicans when they read that the Prime Minister had said the word Bailout was one of shock, horror and total embarrassment or pretend shock, horror and total embarrassment based on which party you support. There is no difference between asking for an IMF loan and a bailout, it just makes us feel better to say we negotiated a loan from the IMF, well if it walks like a duck and quacks like a duck then it must be a bloody duck.

The Reason for the world’s financial crisis was greed and corruption, first world corruption at its very best and the reason for Jamaica’s financial crisis is home grown corruption and pure greed. The financial crisis in America, United Kingdom, Greece, Italy, Spain, Ireland, Belgium, Portugal and many others is as a result of greed and corruption. But yet we seem to judge their financial crisis, their corruption as different from ours. In the minds of most Jamaicans and the world there is a difference between white/first world corruption and black third world corruption, one is a simple white collar mistake and the other is downright banana republic, nasty black corruption and throwing any money at it is like throwing pearls before swine.

I understand that the world is not level I understand that different countries get treated differently, I just do not understand why Jamaicans hold the rest of the world to a different standard than they hold Jamaica and themselves. 

The IMF and World Bank as Fly Guy and Jamaica as the Bit<h!

Please Read!!
In five years between 2006 and 2010, Trinidad and Tobago exported more than $23 billion worth of goods to Jamaica and in the same period Trinidad imported a mere $1 billion from Jamaica.
T&T 2006-2010 exports to Jamaica: $23 billion

In 2011, Jamaica imported US$6.6b in goods and exported US$1.6b. The trade deficit was approximately US$4.9b.

There are people in Jamaica who thinks certain developed countries have Jamaica's interest at heart but they are just fooling themselves …  These countries are a bunch of Hypocrites and Parasites, back in the 90's the United States of America took Britain and the EU to WTO court to remove preferential treatment for CARICOM banana because it wanted American own companies in south America and Puerto Rico easy access to EU market but the USA is giving Virgin Islands (USVI) and Puerto Rico preferential treatment on RUM…. This is made even worst when UK-based Diageo threatens the Caribbean about taking the USA to WTO court… In August, the UK-based Diageo reportedly warned that should CARICOM mount a complaint to the World Trade Organisation over the alleged subsidies it would "re-evaluate" its Caribbean interests….. Everyone is looking out for their interest alone and what they are saying to CARICOM is Fuck You  and suck salt!!!... 

The EU is still upset that Jamaica and the other Caribbean countries have not implemented its Economic Partnership Agreement which would see a reduction of duties between the EU and the Caribbean, claiming it will also benefit the Caribbean to sign this agreement. They the EU are even offering carrot on a stick to sweeten the deal and get us to sign the agreement.  You can trust me when I say that the EU is only pushing for this agreement simply because it knows it has the Economic advantage over CARICOM and will benefit more from this agreement, this a cheery agreement for them because once you sign this you are on your own as they push their products and tell us our products are not good enough, there standards are like a moving goal post. This agreement will further push Jamaica and the Caribbean into a balance of trade deficit with the EU. The fact of the matter is sooner or later we must sign this agreement, we do not have a choice as the EU will call the Americans for help and both will gang up to gangbang the hell out of us and force us to sign, no loans or deal and a couple downgrades later and we will bend to their will.

This is how we like to spend borrowed Money: 
"SUV drivers not deterred by import costs":
A Cadillac Escalade ESV may retail for about US$56,000 (5300 CC).
Chevrolet Avalanche - about US$36,000 (5300 CC).
Mercedes Benz M Class about US$37,000-67,000 (5400 CC).
Mercedes Benz G Class - US$74,000 -$89,000 (5400 CC).
Land Rover Range Rover - about US$72,000 (5300 CC).
However, these costs are apparently no deterrent to drivers with discerning tastes, as the Cadillac Escalade, Chevrolet Avalanche and other relatively high-end vehicles have become quite popular on local roads.

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