MT Wynne Investment, A Terrible Mistake?

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The views expressed herein does not represent the editorial position on News784,but soley of the author.Send all opinion pieces to news784svg@gmail.com

Caribbean countries such as that of St. Vincent and the Grenadines, political economies are shaped by the legacy of colonialism through the introduction of the sugar plantation and institution of slavery, thus giving rise to the plantation economy.

According to Best and Levitt, plantation economies are those in third world states whose dominant activity is that of agriculture, but also is where historically, the economies being mired by monocropping, which has changed overtime from  Sugarcane to bananas and now to tourism thus leading to a mono-economy. Caribbean Plantation economic model is that which is used to analyse Caribbean political economies, thereby assisting us in understanding why our governments embark on certain economic policy initiatives and the further understanding of the interconnectedness between Caribbean economies and its role in the global capitalist economy.

These economies are small, open and vulnerable, which is a result of its colonial experience as they were simply used for production of raw materials, such as sugar cane and even bananas to the benefit of metropolitan states or market in Europe.

This lead to the continued level of economic dependency even though most Caribbean states attained political sovereignty and independence 1960s-1980s and it was deepened through the economic initiative by economist Sir Arthur Lewis “Industrialization by Invitation” 1950s-70s, as industries were invited via Caribbean governments through attractive incentives which includes tax free agreements and other concessions in return that employment will be created and standard of living will be better for citizens in these various states, however it turned out to be quite the opposite, as industries pulled out after the expiration of the tax free incentive.

In the latter part of the twentieth century, many Caribbean states moved from agricultural based economies to tourism, as bananas and sugar cane became non-profitable and thus there was need for an alternative that can lead to economic growth and development to replace agriculture as the dominant economic activity in these states.

There’s a slogan that “Tourism is everyone’s business” and rightly so it is. That is because with tourism, it is meant for all sectors of the economy to benefit, from the farmers, fisher folks and craftsmen to taxi and omnibus operators and hoteliers.  This is only possible if all those within these sectors, produce quality goods and can satisfy the demand of hoteliers in terms of agricultural produce, meats and also good customer service which are equally important for the profitability of this industry.

That is why hotel development is important, hence the construction of the Buccama Resort, expansion of existing hotels, Canouan hotel development and the new agreement for the development of new hotels in Mt Wynne are vital to the tourism industry and St. Vincent’s economy, as the Argyle International Airport will be completed sooner rather than later, thus receiving large influx of tourist to our shores.

However these sort of infrastructural developments (hotels and resorts) are mainly possible through foreign investment as foreigners already have the capital to do so with a little cost on the state in terms of incentives and concessions. Some then ask why not pursue local investors? Well the answer simply is that even though some may have the capital to do so, they necessarily may not be able to build a hotel to the magnitude that foreign investors can due to little capital and the state may have to bear a tremendous cost in such a venture. These investments therefore can assist in alleviation of poverty, job creation, not only in construction but also in terms of permanent jobs especially for young students who would have studied tourism and hospitality at the St. Vincent Community College along with chefs, cooks, clerks, divers etc, placing more money in people’s pockets and food on their tables.

On the flip side, there are contrary and protesting views toward this investment, some of which are spouted with falsehoods and others with grave and serious concerns. The lands in Mt Wynne were bought by the Sir James Mitchell NDP administration, for the sole purposes of hotel and tourism development which was also endorsed by the current Opposition Leader, Hon. Arnhim Eustace when he was Prime Minister in 2000, of which he himself, was prepared and willing to give the lands freely to investors to develop, to which this current government took the route of selling underdeveloped  lands to developers valued at market price. It then leaves one to wonder what has changed for the Opposition leader between 2000-2016 to change his views. There are concerns surrounding beach access, which in the agreement will not be taken away from citizens just as it isn’t in Canouan and other beaches with hotel development.

The downside to tourism and foreign investment, is that it leads to further economic dependency.  Economic dependency theory according to Best and Levitt, is characterized by mode of production and distribution of goods and services being majorly owned by foreign investors. Therefore, as we then depend on foreigners to help facilitate growth in our economies and job creation, there are negatives that can derive from such a venture, as looking recently at Barbados, we can see what can happen whenever there’s an economic crisis globally and depending on how connected you are with these foreign, metropolitan developed economies, small, dependent and vulnerable economies like ours will take long to recover from those economic shocks.

 Government must balance satisfying the needs of the people, such as employment, while seeking a balance to satisfy other interest groups within the state, whether environmentalist and even nationalist, seeking to ensure preservation of beaches and our local identity. The question to be asked is whether it is a fair compromise in allowing further foreign direct investments, where they provide job opportunities to citizens even though it’s a cost to the state where we provide attractive incentives such as concessions to lure them to invest. At the end of the day, it always boils down to jobs and food on people’s table and though yes, tourism may deepen economic dependency, governments cannot sit and think on theories but to act in satisfying the demanding needs of the people.

Augustine Ferdinand

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