First things first

JEAN LOWRIE-CHIN

Monday, April 19, 2010

Some years ago a couple I know suddenly became jobless. "One day I realised that we had absolutely no money to even provide dinner," said my friend. "We and the children started to check bags and pockets for loose change. We went to a little shop nearby, bought some flour and a couple of cans of sardines. We had some curry powder in the cupboard." Then my friend's eyes lit up as she ended her story: "Well! We made the softest, lightest roti and curried the sardines to go with it! It was delicious and we all had enough!"

With that attitude of gratitude for enough, they started a small enterprise which has supported them well through the years. The problem, however, is that some of us have stretched "enough" out of proportion, making the Jamaican economy more dependent than ever on foreign oil, while not tapping into our rich human and natural resources to produce and export more.

At an event headlined, "Moving Forward from a Strong Foundation: Options and Opportunities for the Jamaican Economy", we listened to the observations of financial analyst Dennis Chung and University of Kansas professor David Westbrook. While we should observe the presentations of our national budget debate, we need to temper the political posturing with reality checks like this session planned by the US Embassy's public affairs section.

The pleadings of government, the trashing of the budget by the Opposition is an expected annual pantomime, regardless of who is in power. Clearly, the system is flawed if we have plunged from the higher to the lower half of world economies as Chung stated. The folks in sugar may not be enchanted to hear Chung's declaration that we are investing in an industry that continues to lose money, while occupying 70 per cent of our agricultural lands. He suggests that we move to niche markets in agro-industry.

Another clear though not simple solution is to reduce energy costs. Chung suggests that if we were to reduce energy costs by 30 per cent we could wipe out our deficit in four years! He points out the ever-growing, ever-slowing traffic on our streets and recommends heavy investment in public transportation.

But first things first: I would hazard a guess that after last Monday's horrendous shooting up of a bus in broad daylight, resulting in the injury of three schoolchildren, that if crime is not fixed those who have the option will not be sending their children on the bus.

Do we understand how we have damaged two generations by allowing thuggery and extortion to take over a large part of our transportation system? A happy bus ride with schoolmates was such an important part of growing up and learning the landscape of our city and country. Now most middle-class children would be lost below Half-Way-Tree, let alone Cross Roads!

Chung made a sobering observation: business real estate is scarce and expensive because so much of it is locked away in garrisons! Consider how Kingston would open up if our city were de-garrisonised. Instead, we have exported this national disease to our second city, holding even more ambitious Jamaicans hostage.

In the case of agriculture, we have to fix praedial larceny if we want to attract serious investors. Kudos to our stalwarts in citrus and bananas like Trade Winds and Jamaica Producers who have worked with the challenges, and have gone on to add value with a First-World line of products in juices and snacks.

Dennis Chung concluded that if we do not have radical reform of our constitutional and political system, with separation of powers similar to the US system of government, we may not be able to make that quantum leap in development.

The self-effacing Professor Westbrook found himself in a dilemma: how would he tell this resource-rich country that we need to get off our high horse without being undiplomatic. To soften his approach, he spoke first of the 2008 crisis in his own country, documented in his book, After the Crisis: Rethinking our Capital Markets.

He said both our countries had entered "a time of reassessment" and that we should be encouraged that in Jamaica we had agreement across political lines regarding the

realignment of the size of our public sector. He suggested that the restoration of confidence should be a national priority and used the metaphor of sport to guide us in considering "what would make investors willing to get into the game?"

He touched on the matter of crime by relating his brother's experience in South Africa where a friend was murdered and said that while this may have been an isolated incident, a foreign investor would begin to ponder, "Do I have to be here to build a car?" Investors always ask, "What is the tax code?", "What is their rate of inflation?" If the answers to these questions are not satisfactory, Westbrook says, "They will take their money and play somewhere else."

Westbrook raised the question of dollarisation in the context that "the contemporary global economy is very networked". He asked, "Does a country of less than three million have to have its own currency?" He mentioned his German grandmother's resistance to changing the Deutsch Mark for the Euro and suggested as a compromise, with the agreement of Chung and Chris Zacca, that a Caricom currency should be pursued. Clearly, we should be insisting that our leaders take these solid suggestions on board.

We salute Roy Collister

Roy Collister was a reassuring part of the lives of those in my generation. His solid advocacy of private sector issues and his energetic involvement in national life demonstrated the honour of constructive criticism. At the presentation of the Order of Jamaica to him shortly before his recent death, Prime Minister Golding remarked: "He has been in the vanguard of the private sector and has provided sterling leadership to this country." We salute this valiant defender of free enterprise and offer condolences to his son, our colleague Keith, and the rest of his family.

lowriechin@aim.com

www.lowrie-chin.blogspot.com

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COMMENTS (3)

Paul Lewis
4/19/2010

So it all boils down to a country that is controlled by criminals with no effective Policing can never be a place conducive to Investment muchless Economical growth. What Jamaica has done throughout the years has befuddled Economists the world over. However this unique situation couldn't continue indefinately as is evident by the crisis that we are now in. The successive Gov'ts. knew the three card hustle wouldn't be sustainable, so they plundered as much as they could until the bottomless pit was made bare.

Wharf Dawg
4/19/2010

Dollarization is the way forward and we do not need a Caricom currency. Full dollarization to the US dollar that way our moribund politicians cannot print money as they want and will force us to live within our means and produce our way to prosperity. Jamaica should identify our sugar needs and keep enough lands in sugar production and the rest for agricultural produce that we are importing.
It is time we do things differently and efficiently!

Brooklyn Jamaican
4/19/2010

Miss Chin, I am from country but since I went to then CAST in the eighty's, I have been asking this question. What is going to happen to those large swaths of property all over KIngston when the heirs of the real owners say enough is enough and start a revolution to reclaim their birthright?
What will happen to the so call 'suffarahs" when that day comes? and it will come.
The protection of the innocent and vulnerable in a modern society is essential; but the wise scale disruption of order in the name of "man haffi eat a food" is what leads to breakdown in order. A few may have to suffer for the greater public good. When that simple law is violated then everyone suffers as is the case now as such "pity" becomes an epidemic of slackness and nastiness.

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GCT to go down, white rum prices going up

First things first