News

Region to continue experiencing 'recession-type' conditions

- Says former PM

BY MARK CUMMINGS Editor-at-Large Western Bureau cummingsm@jamaicaobserver.com

Tuesday, April 29, 2014    

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ROSE HALL, St James —Former Jamaica Prime Minister Bruce Golding has warned that the Caribbean region will continue to experience "recession-type conditions" for a number of years, despite the official end of the global recession four years ago.

He argued that the global recession, coupled with what he described as the reluctant, slow uncertain recovery, has forced governments across the Caribbean region, in particular, to undergo painful restructuring of their economies.

"The impact of the global recession plus the slow, reluctant, uncertain recovery that is taking place is one thing, but the recession has brought Caribbean governments in particular, face-to-face with the necessity, indeed the inevitability of harsh structural adjustments. So, the recession that hit us in the latter part of 2007 and 2008 is like the earthquake and what we are experiencing now are the aftershocks. We still have not steadied off," he explained.

The former prime minister was speaking on Sunday night at the 28th Annual Sales Congress of the Caribbean Association of Insurance and Financial Advisors (CARIAFA) at the Hilton Rose Hall Hotel and Spa in St James.

Stressing that the Caribbean economies have been battered by the global recession, Golding told the delegates that as a result of the slow pace of the economic recovery, several Caribbean islands, including Jamaica, have had to enter into agreements with the International Monetary Fund (IMF).

"In Grenada, they are about to enter a new agreement with the IMF and therefore they are likely to face serious structural issues that are likely to require strong, painful policy response," the former prime minister argued.

He said a recent report from the IMF, which pointed out that global recovery is taking place but that it is uneven, "has triggered fear in my mind that perhaps in the unevenness in that recovery we are beginning to sow the seeds of the next recession, because the world can't proceed on that lopsided basis."

He told the more than 200 insurance executives in attendance at the function that, in light of the shrinking economies, it will become increasingly more difficult to market life insurance products.

"When the economy is shrinking, it means that it will become even more difficult to sell a policy, and it becomes difficult to even those to whom you have already sold policies to keep those policies," he argued.

He told the gathering that due to the harsh economic climate, insurance products will have to be constantly reviewed to reflect the changing needs of policyholders.

"The products that you offer, the services that you offer will have to be constantly reviewed. The economic turbulence and the economic fortunes of your clients — those that you have already signed up and those who are potential clients -- mean that your offerings will have to be responsive to their changing needs. Life after death is not the only concern facing ordinary people," Golding emphasised.

Meanwhile, Patricia Marguerite Gilding of Barbados was inducted in the CARAIFA's Hall of Fame during Sunday's first day of the three-day congress, which is being held under the theme "Embracing the future."

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