KINGSTON, Jamaica (JIS) — Several business and trade union leaders are hopeful of further reductions in Jamaica’s poverty rate over the short to medium term.

The Planning Institute of Jamaica (PIOJ) reports that poverty fell by 4.1 percentage points to 17.1 per cent in 2016, down from 21.2 per cent the previous year.

A breakdown shows that the Kingston Metropolitan Area (KMA) recorded a 2.4 percentage-point decline in its poverty rate, to 11.9 per cent; the figure for rural areas was down eight percentage points to 20.5 per cent; while other towns registered a 1.3 percentage-point increase to 16 per cent.

Speaking at the PIOJ’s recent quarterly media briefing, Director General, Dr Wayne Henry, noted that the decline in the overall poverty rate in 2016 was attributable to several key economic factors.

These include gross domestic product (GDP) growth of 1.4 per cent; 12.9 per cent growth in agriculture, which accounted for 7.3 per cent of GDP in 2016; an increase of 38,600 in the employed labour force in July 2016, with the overall total climbing to 1,186,100; higher remittance inflows, which increased to US$2.3 billion; and a 1.7 per cent inflation rate, representing the lowest in over 45 years.

Henry said he is hopeful that poverty will decline further, based on government policies, particularly those accelerating job creation.

“We have seen where the lead industries are driving the jobs (that) are being created… and we know this augurs well for the overall economy. This is what we want to continue… where we build a resilient environment for business as well as a climate-resilient environment. So for us, the hope for further poverty reduction is very encouraging,” he added.

Jamaica Employers’ Federation (JEF) President, David Wan, who welcomes news of the decline, believes poverty will fall further over the next two to three years, based on factors to which he says the 2016 out-turn is attributable.

Foremost, he tells JIS News, is the significant level of public- and private-sector infrastructure development under way.

Among these are construction of the Ministry of Foreign Affairs and Foreign Trade’s new office building in downtown Kingston; business process outsourcing (BPO) developments on Half-Way Tree Road; and improvement works on Barbican Road, Mandela Highway, Hagley Park Road/Three Miles, and Constant Spring Road, among other areas.

Wan also highlights significant hotel developments in Kingston and the north and south coast resort areas, while pointing to other industry projects “that I am hearing about that are still not ready for announcement”.

The JEF President further notes the National Housing Trust’s (NHT’s) planned construction of upwards of 15,000 homes over the next several years; developments with the Government’s Logistics Hub Initiative; and significant employment generation within the BPO sector.

“Those are the (notable areas) that I think are factoring in the drop in poverty (and are) going to be the drivers of improvement in employment. Looking down the road, I do expect there to be some more fall in the poverty rate, because there are projects that I am aware of that are still on the drawing board. So, for those main reasons, I think over the next two to three years, we are going to see even more reduction in poverty,” Wan adds.

Jamaica Manufacturers and Exporters’ Association (JMEA) President, Metry Seaga, believes Jamaica’s solid macroeconomic environment has been influencing poverty reduction, and will continue to do so.

He lauds the Administrations of both political parties for their diligence and commitment to maintaining the fiscal discipline characterising Jamaica’s International Monetary Fund (IMF)-backed economic reform programme over the last six years.

Seaga believes this has provided Jamaica with a “great platform” from which to wage a sustained assault on poverty.

“I am happy that the poverty rates are reducing. I am hoping that they will decline even further and I am optimistic (of this happening). We need higher levels of sustainable growth in the economy… and (once this starts to occur) we should be in good stead,” he says.

Small Business Association of Jamaica (SBAJ) President, Hugh Johnson, says while he hoped the reduction would have been greater, he welcomes news of the decline.

He, too, believes that the macroeconomic environment contributed significantly to the 2016 out-turn, and expects it to result in further reductions.

“We are seeing some effort by the Government to get the grassroots people to benefit from these (macroeconomic) interventions. We think that is good… and I applaud the Government’s move and urge them to even do greater, because (we believe) more can be done,” the president says.

Johnson suggests that the Government place greater focus on getting micro, small and medium-sized businesses to operate more efficiently by assisting them with training and capacity building.

Former Jamaica Chamber of Commerce (JCC) President, Warren McDonald, also cites infrastructure development and improved agricultural outputs among the key contributing factors.

Noting that infrastructure development is “one good indicator,” McDonald also highlights road improvement and building construction works being undertaken, pointing out that “I can’t recall so many (ever happening) at one time”.

Additionally, he attributes the decline in poverty in rural areas to a rebound in the agricultural sector.

McDonald further highlights several supporting macroeconomic indicators. These include low inflation and interest rates; currency stability; healthy net international reserves; above-target revenue inflows, “and a lot of new jobs… which have resulted in a reduction in unemployment to 9.6 per cent as at January 2018”.

“If we look on the macroeconomic indicators, they are saying it’s a good time for investments. So, the general perceptions are good and these are reflected in the business and consumer confidence indices put out by the Jamaica Chamber of Commerce, which are still way up. I think, overall, the indicators are for continued reduction in poverty and improvement in growth,” he adds.

Jamaica Confederation of Trade Unions (JCTU) Vice-President, St Patrice Ennis, says the decline is “encouraging”, adding that any improvement in persons’ standard of living is welcomed.

While arguing that the 17.1 per cent out-turn is “far too high for us to be comfortable with,” Ennis, who is General Secretary of the Union of Technical, Administrative and Supervisory Personnel (UTASP), is hopeful of further reductions.

“I don’t feel that we are where we need to be (in terms of a comfortable rate). So, we must continue to improve on what we are doing, as a country, to improve the standard of living of those persons who are so challenged,” he adds.