The food processing industry
Marjorie Henry, Contributor

Today's lesson concludes the discussion of question six of the June 2007 CSEC question paper. Last week, we left off at part (c) (i) of the question where you were asked to account for the widespread occurrence of two industries in the Caribbean, namely, the garment industry and food processing. I have already shared with you reasons for the prevalence of the garment industry. I will now go to the food processing industry.

Food processing

• The availability of raw materials locally as well as the ease of procuring them from overseas.
• Demand for the various products provides markets locally and internationally.
• The industry can be successful even on a small scale, for example, cottage industries producing items such as jams and jellies.
• A variety of products are produced that cater to different tastes or markets.
• It is labour intensive and can easily provide employment for a large number of persons.
• Many employees may have low-level skills and training can be provided for them without much difficulty.

Again, I may add that these are not all the answers and that there are other reasons that you can find for yourself.
In part (c) (ii), the final section of the question, you are to suggest reasons Caribbean manufacturers might find it difficult to compete in a global market. Here are some suggestions:

• Quality - the inability to meet the required standards established by global markets, for example, USA, Canada and Europe.
• Quantity - the inability to produce on a large scale as evident in the global market.
• The unit cost of production is higher because of the small economies of scale.
• There is not enough use of modern technology as practised by large manufacturers in the global market.
• The high cost of inputs, such as energy, transportation and communication.
• The high cost of marketing to establish Caribbean brands outside of the region.
• The advocate of free trade, for example, the World Trade Organisation is making it more difficult for Caribbean manufacturers to get higher prices for their products.
• The preferential treatment given by the European Union, which over the years, has been declining.
• Lower labour costs in many countries, for example, Asia, that result in low production costs in those countries.

From the points mentioned above, you need to realise that many of the problems faced by the Caribbean manufacturer result from high production cost and lower prices for their manufactured goods. Inefficiencies in operation can also lead to an increase in production cost.

A discussion of question seven will begin in the next lesson. Like question six, it is based on economic activity as outlined in your syllabus. The focus will be on tourism and agriculture. If you have access to the question, begin to read your text books and identify the possible response to the different sections of the question.

The library is always the best place to get some work done at Denbigh High School. photo by Michael Lee

Marjorie Henry is an independent contributor.