Encouraging economic signs

Sunday, May 18, 2014    

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Pundits and so-called economic experts, local and foreign, have taken a fiendish delight in making doom and gloom prognostications about the imminent implosion of the Jamaican economy.

These prophets chant repeatedly that the end is near, whether out of incompetence, or political malice, or the desire for notoriety. The upshot is that they have inflicted incalculable damage on the efforts of the Government of Jamaica as it struggles to stabilise and adjust the economy. These prophets of doom have contributed to the retardation of the nascent recovery of economic growth as they persist in their reckless attempt to be proven right, speculating rather than accepting empirical evidence.

Jamaica has swallowed the bitter IMF-prescribed medicine and stuck to the course, thanks to the Spartan discipline of Finance Minister Dr Peter Phillips. According to the Planning Institute of Jamaica (PIOJ), the Jamaican economy recorded estimated economic growth of 1.6 per cent between January and March 2014, relative to the corresponding last year.

This was the third consecutive quarter of economic growth, and as Mr Colin Bullock, the director general of the PIOJ, points out, represents the continued strengthening of economic performance. There was strong growth in agriculture and mining, with marginal expansion in the construction and service sectors. Manufacturing was the only sector to experience a contraction.

The International Monetary Fund mission which visited Jamaica May 5-16 and conducted the fourth review of the island's IMF-supported programme under the Extended Fund Facility has pronounced that the programme is "on track" and that the economic outlook is improving.

The IMF press release of May 16, which is always couched in the most conservative language, states: "Since the start of the programme in early 2013, crisis risks have receded, growth has picked up, net exports are stronger, inflation has been brought under control, and reserves are starting to recover."

That, dear readers, is as good a seal of good housekeeping as it gets from the IMF.

In the past, Jamaicans were guilty of being our own worst enemy by talk redolent of anxiety and too often being focused on the negatives. The country needs to focus on the positives, and the pronouncements of last week show that there are, indeed, positives.

Clearly, the country's economic difficulties are not over, but there are encouraging signs. Let us all be careful that fulmination masquerading as analysis does not become a cause of economic paralysis. Let us not talk the economy of Jamaica to death.





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