Jamaica’s economic problems lain on doorstep of politicians

By Lawson Brooks

In Jamaica, consensus on a variety of topics can be hard to find.

But two issues that virtually every inhabitant of this country of 2.7 million can agree on is that its economy staggers on the verge of a calamity and that their politicians are to blame.

Many observers rightfully suggest that inept leadership and fiscal mismanagement has Jamaica still striving to achieve economic independence more than 50 years after its successful effort to attain self-governance.

These harsh assessments of the government and the country’s economic outlook are compounded by austerity measures that were the strings attached to a $2 billion financial bailout by the International Monetary Fund in 2013.

Despite the perception that acceptance of these funds eroded the government’s ability to address social and economic issues, in reality Jamaica’s debt obligations could not have been met without them.

Even with IMF money, an untimely hurricane or other natural phenomenon could set the country’s economic rehabilitation efforts back for years to come.

While many of the English-speaking island states that populate the Caribbean are experiencing financial distress, none are confronted with more perils than Jamaica. Economic growth is stagnant at worst and slow at best.

From 2003 until 2013, the annual growth rate, measured by gross domestic product, averaged 0.5 percent, according to the Trading Economics website. The rate reached an all-time high of 4.3 percent in December 2006 and a record negative 4.5 percent in June 2009.

“Jamaica’s large shadow economy and lax tax regulations have translated into persistent fiscal deficits and heavy dependence on remittances,” Trading Economics reported. “Bureaucracy, high energy costs and a slow, inefficient legal system are hampering foreign direct investments and private initiative.”

Crime, unemployment and debt are at record highs and no one, including the ruling Peoples National Party headed by Prime Minister Portia Simpson Miller, seems to have the answer.

“Mama P,” as she is known to many, has made it her mission to ensure that former premier, PNP president and National Hero Norman Manley’s desire for the country to achieve comprehensive social and economic reform is reached. But for now, this goal appears to be not only elusive, but also unattainable.

Jamaicans’ participation in the electoral process at all levels is decreasing with each passing year.

In 2012, just 26 percent of voters bothered to exercise their right, an indication of voter distrust or apathy.  Either way, it doesn’t bode well for creating mandates for public policies and initiatives.

In a recent article, Lloyd B. Smith, a member of Parliament and deputy speaker of the House of Representatives, opined: “This means that the majority of Jamaicans have no interest in how their country is run, which also means that we continue to elect, in real terms, a minority government.”

In an effort to maintain relevancy, Andrew Holness, leader of the opposition Jamaican Labour Party (JLP), said he is working on an economic strategy that he hopes to announce soon. His focus will be based on the belief that in order to achieve growth and development, a more knowledge-based society must be established.

Holness insists that technology and innovation has to be at the forefront of a new economy in Jamaica.

For its part, the IMF is requiring that most of the austerity measures and economic reforms be implemented almost immediately. Regardless, there was skepticism in many quarters as to whether or not Jamaica can comply.

As of last week, it looks as if those doubts were warranted.  Anthony Hylton, minister of industry, commerce and investment, announced that the timeline for implementing reforms agreed to by the government in exchange for loans and market access had been moderated.

Given the political and economic challenges confronting Jamaica, it remains to be seen whether the country’s leadership can expand beyond tourism and make the necessary decisions to turn around an economy that has suffered from a lack of long-term planning.

The citizens are ready for change, but can the political elite deliver?

Lawson Brooks is a Washington, D.C., political consultant.

Crime, unemployment and debt are at record highs and no one, including the ruling Peoples National Party headed by Prime Minister Portia Simpson Miller, seems to have the answer.