By Lynda Kiernan
Billionaire chairman of the National Commercial Bank (NCB) Financial Group Michael Lee-Chin has acquired 3,000 acres in St. Catherine, Jamaica, and is leading an investor group in backing a major agricultural project on the site.
The ‘mega-farm’ will be located on land formerly a part of the Innswood Sugar Estates, and will produce both short- and long-term crops (which I assume to mean both annual and permanent crops) including mangos, soursops, cantaloupes, and melons, according to Audley Shaw, Minister of Industry, Commerce, Agriculture, and Fisheries, who noted that Israeli technology will be employed at the farm.
Native to Jamaica, Lee-Chin is the only Caribbean-born billionaire on the Forbes 2018 list. As of March 2019, Lee-Chin had amassed a fortune totaling $1.9 billion through investments made in financing companies such as NCB and AIC Limited in Canada, which he acquired in 1987 when it had only less than $1 million in assets. By 2002 AIC was managing assets in excess of $10 billion, but after the recession of 2008 AIC was struggling, and by 2009 Lee-Chin sold AIC to Manulife for an undisclosed sum.
Agriculture, when also accounting for agro-based manufacturing, accounts for 15 percent of Jamaica’s GDP, however, agriculture in the country is seen as a higher risk than trade or other industries, mostly due to a lack of funding or access to capital for farmers in the country.
Traditional financing institutions in the country are still using antiquated risk assessment formulas, and together with complicated red-tape, requirements for collateral that most of Jamaica’s farmers cannot meet, market volatility, and ag being a highly cash-based business where receivables are often significantly delayed, Forbes said that less than 2 percent of the country’s lending portfolio is deployed in the agricultural sector, and fewer than 10 percent of the country’s farmers have access to credit lines.
In the past, Lee-Chin has been vocal about the state of Jamaica’s agricultural sector, saying in 2015, “Then I thought, Jamaica is known for the best coffee and ginger, our cocoa is also eminent in the world. How about sea-island cotton, isn’t Jamaica’s cotton eminent in the world? Yet still all of these areas of agriculture production have gone south, isn’t that crazy? Shame on us!”
A few years later, in 2018, Lee-Chin donated $60 million to Jamaica’s smallholder coffee farmers to help boost the industry after a protracted decline spanning 25 years.
As prices dropped to $4,000 per box, Lee-Chin noted that the country’s farmers lost their ability to effectively sway the market.
“We used to produce 700,000 boxes of Blue Mountain coffee. We are targeting 230,000 or 240,000 right now – that’s a pretty sharp decline,” he said.
Lynda Kiernan is Editor with GAI Media and daily contributor to the GAI News and Agtech Intel platforms. If you would like to submit a contribution for consideration, please contact Ms. Kiernan at lkiernan@globalaginvesting.