New Orleans & Jamaica confront double troubles

Dennis Morrison, Contributor

Americans living in the Gulf States have taken a staggering blow to their economy and ecology from the BP oil rig explosion and spill, the effects of which are likely to be felt for many years. No matter how soon the well is plugged, people who earn their livelihood from the fishing and tourism industries of Louisiana in particular, are going to be dislocated.

For me, a lover of Cajun cuisine and especially gumbo (a staple dish of the region), it has been painful watching the images of the oil spill spread inexorably to the marshes and other fishing grounds. Holiday spots on the coastline are also deserted at a time when traffic to the region, where the way of life is so attached to the water, would be picking up.

New Orleans, which has yet to regain its economic footing after being turned upside down by Hurricane Katrina five years ago will, by all accounts, be at the centre of the fallout from this latest disaster. We can thus understand the outrage of its citizens as they watch helplessly while being overrun by an environmental catastrophe (a depiction now acknowledged by the head of BP who had earlier regarded it as hyperbole).

As if the oil spill were not disheartening enough, the people of the region must now reckon with the forecast by the National Oceanic and Atmospheric Administration (NOAA) pointing to a possible, extremely active 2010 Atlantic hurricane season.

NOAA's predictions must also be worrying news for Jamaicans who have been bombarded by hurricanes in active seasons in 2004, 2005, 2007 and 2008. We, too, are in the midst of a major disruptive event, the Coke extradition battle, that on its own will be hard to clean up, but combined with a damaging natural disaster like a hurricane could threaten to overwhelm the national spirit. Indeed, from what I can glean observing the fallout of the battle on brand Jamaica from overseas, it will take a sustained marketing campaign to repair the damage.

Like the people of New Orleans, we must, however, find the fortitude to confront and overcome the immediate challenges, which in our case, are related to the chronic security problems even while ensuring that the necessary preparations for the hurricane season are done. No one should be complacent about the probability of an active season, and based on recent experience, we know how severe the damage can be.

This year's forecast indicates that we could see between 14-23 named storms, well above the average of less than 10. Of these, between eight and 14 could become hurricanes, and three to seven could be major hurricanes with winds of over 110 miles per hour, a situation on par with what happened in 2005 and 2008.

wreaked havoc

Almost for the entire decade of the 2000s, our agricultural sector was bombarded by above-average hurricane activity that wreaked havoc on agriculture, roads and shorelines, as well as electricity infrastructure. The most serious damage was suffered in 2002, 2004, 2005, 2007 and 2008. As a result of the high frequency of hurricane activity, the banana industry was virtually destroyed and sugar took a heavy beating as well.

I know from the prices for my sample of food crops purchased from Coronation Market that production of bananas and plantains has not recovered since 2007 or from the hurricanes of 2004 and 2005. In the case of green bananas, the price was on average $30 per dozen prior to hurricane Dean but is still hovering around $60-$70 while green plantains, which stood at $20 per finger, are now $40-$50 per finger.

Beyond these specific items, the impact of the disruption of agricultural production was reflected in spikes in the entire category of domestic food prices that were responsible for double-digit inflation rates in 2004 and 2005 and that pushed the cost of living even higher in 2007 and 2008. Largely because we were not affected by hurricane activity last year, the inflation rate dropped to 10.2 per cent, from nearly 17.0 per cent in 2008. With the rate of inflation already at 5.5 per cent up to April, the best thing for our economy would be another year, with little hurricane disruption.

first-hand experience

The impact of hurricane activity on the economy has also been felt in recent years through the tourism and mining sectors. Both sectors experienced serious dislocation. I know from first-hand experience that the tourist industry, which had watched arrivals grow by 8.6 per cent up to August 2004, saw that slip by nearly a half, to 4.6 per cent after Ivan hit the island. In the mining sector, Jamalco, Alpart and Windalco experienced major interruptions in 2004, and again in 2007; and Jamalco's port was crippled on both occasions. Given the state of the sector, hurricane disruption would be most problematic.

While the outlook for hurricanes is not good, the actual outcome will, according to the forecasters, depend on at least two factors: upper atmospheric winds, and sea surface temperatures in the Atlantic Ocean. Strong winds help to break up storms, while cooler water temperatures do not favour build-up of hurricanes. Both conditions existed in 2009, hence we had a less active season.

At this point, the winds are weakening and warm temperatures in the Atlantic are at record highs, which point to an active season ahead. Our hope must be that these conditions will change in our favour in the weeks ahead.

Dennis Morrison is an economist. Feedback may be sent to columns@gleanerjm.com