Abstract
Micro, small, and medium enterprises (MSMEs) in the English-speaking Caribbean (ESC) are domestically focused, with a limited level of exports of goods and services. Such a situation constrains the long-term growth prospects of the region. The chapter seeks to explain some of the reasons for this limited focus from the perspective of history, policy-making, and at the enterprise level. In addition, using recent data from the ESC, the correlates of export propensity, that is, whether a firms exports or not, and export intensity, that is, the level of exporting in relation to total sales, are presented. To redress the imbalance seen, lessons from successful, internationalised, Caribbean enterprises are provided to assist in the development of indigenous, growth-oriented, entrepreneurship.
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Notes
- 1.
The importation of goods and services in the ESC, as a percentage of GDP, exceeds the exports of goods and services for every country in the region with the exception of oil-rich Trinidad and Tobago. The difference in these percentages varies from −32.8 % of GDP in St Vincent and the Grenadines to −5.5 % in Belize. For Trinidad and Tobago, the related difference is +15.3 % (The World Bank 2015).
- 2.
The most recent “blacklisting” of offshore financial centres (OFCs) in the Global South by the Global North, termed “tax havens”, was in June 2015 by the European Union and included 7 of the 12 countries in the ESC (EUbusiness Ltd 2015).
- 3.
Other small states refer to members of the Small States Forum, a listing of which can be found at http://www.worldbank.org/en/country/smallstates [Accessed 30 December 2015].
- 4.
This difference was significant with Chi-squared = 32.166, Significance = 0.000, Phi = 0.144.
- 5.
This difference was significant with Mann–Whitney U-test Significance = 0.000.
- 6.
For a useful review of international trade theory, including new trade theory, see Sen (2005).
- 7.
The Caribbean has a long history of international trade, driven by production to serve the metropole. An account of the history of business in the region can be found in Higman and Monteith (2010). However, the contention here is that the current MSMEs in the ESC are relatively young, and have yet to have the requisite time to develop sufficiently to ably compete in the global market. The CC survey data indicates that the mean age of MSMEs is 24 years, with 75 % of them under 31 years of age.
- 8.
We, however, note that the level of entrepreneurial activity varies across the region, with new business ownership rate varying from 4.2 % of the 18–64 population in Barbados, to 7.4 % in Trinidad and Tobago, and 11.9 % in Jamaica; the average for Latin America and the Caribbean (LAC) was 6.7 % (Singer et al. 2015). The established business ownership rate also showed a level of variation, ranging from 7.1 % in Barbados, to 8.5 % in Trinidad and Tobago, and 14.4 % in Jamaica, with a LAC average of 8.0 %.
- 9.
These include the Caribbean-wide initiative by Sir Richard Branson, the establishment of the Branson Centre (located in Jamaica). For details see http://bransoncentre.co/caribbean/and http://jamaica-gleaner.com/gleaner/20110909/lead/lead4.html
- 10.
This was part of a US$70 million initiative announced by US President Barak Obama during an official visit to Jamaica (8–9 April 2015); see details at http://jis.gov.jm/president-obama-announces-us70-million-youth-training-employment-programme/and http://jamaica-gleaner.com/article/lead-stories/20150410/caribbean-youth-happy-us70m-obama-initiative
- 11.
- 12.
See Axinn and Matthyssens (2002) for a discussion of traditional internationalisation theories and their shortcomings in light of changes in the structure and nature of the global economy.
- 13.
We do not accept Gashi et al. (2014) blindly, but consider their approach and focus on transition countries as particularly relevant to the situation in the Caribbean.
- 14.
The variables tested for export propensity and intensity for both manufacturing and services included: continuous variables of age of firm, number of employees, sales, sales per employee, net book value, profits, profit margin, level of foreign ownership, proportion of skilled employees, domestic market share, and expenditure on research and development; dichotomous variables: possession of an internationally recognised quality certification, introduction of new product in the last three years, formal training programmes for staff in the last year, and possession of a research and development department; and other categorical variables: sector level of TKI, legal status of the firm, gender structure of ownership, education of management. Where significant differences are not found and noted in the text, please refer to this list to identify the relevant variables. Where significant differences are not found when conceptually we expect to see a difference, we discuss this in the main text.
- 15.
TKI refers to the technology/knowledge intensiveness of the sector. For a full description of these sectors please see Chap. 4.
- 16.
Statistics for assessing significance as follows: foreign ownership r = 0.397, n = 133, p < 0.01; number of employees r = 0.296, n = 133, p < 0.01; sales r = 0.308, n = 126, p < 0.01; sales per employee r = 0.257, n = 126, p < 0.01; net book value r = 0.314, n = 107, p < 0.01; profits r = 0.280, n = 126, p < 0.01.
- 17.
r = −0.182, n = 131, p < 0.05.
- 18.
- 19.
Information from http://www.bobmarley.com/contact [Accessed 4 January 2016].
- 20.
Information from http://www.goddardenterprisesltd.com/ab_.cfm [Accessed 4 January 2016].
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Nicholson, L.A., Lashley, J.G. (2016). Market Orientation and the Caribbean Enterprise. In: Understanding the Caribbean Enterprise. Palgrave Macmillan, London. https://doi.org/10.1057/978-1-349-94879-6_5
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