Three per cent growth per annum is not sufficient — Pandohie


Three per cent growth per annum is not sufficient — Pandohie

Business reporter

Sunday, August 02, 2020

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Following the recent announcement by Government to increase the manufacturing sector's annual output by three per cent over the next five years, president of the Jamaica Manufacturers and Exporters Association (JMEA) Richard Pandohie said that this projection is not sufficiently ambitious given the sector's ability.

“We believe that three per cent over five years is not sufficiently ambitious based on where we are now. We need to be aiming for a growth rate of 3-5 per cent per annum,” Pandohie said after the organisation's annual general meeting on Thursday last when he was re-elected to lead the association for a second term.

The JMEA head said that with the manufacturing growth strategy now finally approved by Government, representing a major step for the organisation—bolder targets need to be envisioned.

“If we are going to have a sharp recovery from the [COVID-19] pandemic effect, we will have to be bolder and set ourselves some realistic stretch targets,” he told the Jamaica Observer Sunday Finance.

Newly appointed minister without portfolio in the Ministry of Industry, Commerce, Agriculture and Fisheries (MICAF) Leslie Campbell made the disclosure of the Government's projections during the tabling of the National Five Year Manufacturing Growth Strategy 2020-2025 for Jamaica in Parliament last week. The strategy developed by MICAF, the JMEA and Jamaica Promotions Corporation (Jampro) aims to increase jobs as well as foreign and local direct investment in the manufacturing industry.

“The overarching objectives of the manufacturing strategy are to improve the business environment necessary to grow and expand Jamaica's manufacturing sector and increase the sector's contribution to the country's economic development,” Campbell had said, mentioning also that the Government's aim was to increase the manufacturing sector's contribution to gross domestic product (GDP) to $81 billion over the next five years, up from $66 billion seen in the last two years.

The rationale behind this recent push by Government stems from data which reflect 16 per cent contributions to GDP by global manufacturers while locally the sector has contributed approximately 8.5 per cent in the last five years.

In the last review of economic performance, the manufacturing sector coupled with agriculture and fisheries were however among the few that experienced increased growth amounting to some 2.2 per cent and 7.8 per cent, respectively, during the first quarter of this year despite the waning impacts of the pandemic.

Pandohie, in further commenting on the pronouncements by Government, said that in order for the targets to be achieved, some key areas of productivity and innovation must first be addressed on the way forward.

“Jamaica has been suffering productivity decline for over 30 years driven by our slow adaptation of technology, especially in the agricultural sector— this makes us less competitive in the global market space. Innovation is where we are going to drive the value-added and linkages. We do have the scale to compete on price with commodity type products, but we have to create an environment that will enable an innovation mindset in all that we do,” he said.

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