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Factors That Influence Development 2
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Factors That Influence Development 2

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Social, cultural and Environmental factors that affect Caribbean development

Social, cultural and Environmental factors that affect Caribbean development

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  • 1. Factors that influence Development Economic
  • 2. Development & The productive sector
    • Development cannot occur without a vibrant economy or productive sector.
    • The productive sector can be classified into
      • The primary sector or extractive industries (fishing; forestry; farming; mining)
      • The secondary sector or manufacturing industries (the processing of raw materials in factories e.g. agro-industries, bauxite smelting, bottling & canning
  • 3.
    • The tertiary sector or services e.g. teaching, insurance, retailing, banking, transport, tourism
    • The quaternary sector – R & D ; computer- and knowledge-based industries that do not need a specific location (‘footloose industries’)
  • 4. Caribbean historically..
    • Colonial Caribbean was treated as a primary producer of raw materials which was exported to Europe for processing
    • No tradition of manufacturing
    • Today
      • Developed tertiary sector – tourism
      • Possibility of developing a quaternary sector – e-commerce
  • 5. Distribution Sector
    • Goods are distributed from the producer to the retailer and consumer.
    • The distribution sector provides:
      • Employment
      • Source raw materials at cheaper prices and this lowers the cost of production for local producers
  • 6. Factors that influence the productive sector And therefore development
  • 7. Competitiveness
      • Agricultural goods & manufactured goods produced in Caribbean are high-cost items.
      • This results from high labour costs compared to other developing areas.
      • Caribbean agricultural products depended on preferential protection from European countries
      • Possible Solution:
        • Mega farms & mechanization???
        • Green houses for high valued crops??
  • 8. Demand
    • Low demand for goods produced ( clothing; handicraft; beverages; paper napkins; cosmetics; appliances ) in the Caribbean both within and outside the region.
    • Solution:
      • ‘ Niche products’ - Caribbean foods & preserves ( jerk seasoning; confectionery; pepper sauce; ketchup; coconut milk ) in diaspora (Caribbean people in New York, London & Toronto)
  • 9. Question
    • Suggest ways in which the tourism industry in the Caribbean can further advance development in the region.
            • 30 marks
            • DUE: MONDAY 20 th OCTOBER, 2008
            • MORNING LESSON
  • 10. Productivity
    • Agriculture has low productivity – manual labour
    • Automated operations show higher production rates per worker but workers need to be well-educated & highly skilled (oil & petrochemicals; micro-electrics; networked systems)
    • Solution:
      • Opportunities for post-secondary training
  • 11. Infrastructure
    • Problems in some Caribbean countries
      • Telephone systems not fully functioning
      • No reliable & safe transport system
      • Long delays at ports
      • Complicated bureaucratic procedures in Ministries of Trade & Industry)
      • Solution:
      • institutional framework must recognize producers as partners
  • 12. Investment Climate
    • Private domestic investment & Foreign Direct Investment (FDI) high but..
    • competition from other developing countries where labour cost is lower
    • We need to
    • Improve Productivity
    • Economic diversification
    • Encourage entrepreneurship – subsidies & loans for R & D
  • 13. Debt
    • Interest on debt can cancel out growth in GDP
      • Huge infrastructure projects – e.g. airports
      • Education reform
      • Cost overruns
      • Corruption & mismanagement
  • 14. Debt – level of indebtedness to foreign loan agencies
    • OECS – debt doubled between 1997 & 2003
    • Belize – 100% increase in debt in 2003
    • Dominica – debt crisis
    • Guyana & Jamaica – long-standing debt commitments
    • SOURCE: WORLD BANK , 2005
  • 15. External Shocks
    • Caribbean vulnerable to adverse global circumstances e.g.
      • Europe’s preferential treatment of ACP bananas discontinued – St. Lucia & Dominica
      • Increase in energy prices
      • Increase in world food prices
  • 16. Technology
    • Information & Communication Technology (ICTs)
      • inadequate in region
      • Cannot compete in globalizing market
      • We need to:
      • Upgrade electronic communication
      • E-marketing & e-commerce
      • Promote products online
      • Develop Networking infrastructure