Dear Editor,

The US Federal Reserve Chairman Jerome Powell said in a 60 Minutes interview that a recovery won’t happen until the end of 2021. He expects US gross domestic product (GDP) to shrink in the second quarter around 30 per cent and unemployment around 25 per cent. These numbers are similar or worse than the Great Depression, but Powell said it will not be a depression.

Fishermen do not say that their fish is stink. The situation is likely worse than he professes.

The question is, what is Jamaica going to do in this new global economic crisis triggered by COVID-19?

Canada, Japan and Europe are also in recession. These countries are integral to global trade and global tourism.

A big part of Jamaica’s economy is tourism and related industries, almost 70 per cent.

A contingency plan is needed to strive in these challenging times. Based on many economists’ analyses, there will be deflation and later inflation.

The best strategy must include agriculture and agro-processing, because the cost of food will increase and supply of food is projected to decrease.

Secondly, Japan, China, US, UK, and Europe have been creating over US$9 dollars. This will lead to currency volatility. The US currency will, after rising, devalue. It happened after the 2008 financial crisis, but will it be greater now since the quantitative easing is much greater?

The Bank of Jamaica should buy precious metals (gold and silver) for security.

The cold war between China and the US will heat up. Besides the trade war, international diplomatic war, corporate sabotage, and cyberwar are likely.

Jamaica’s neutrality is unlikely, but choosing any side will have serious repercussions.

What is Jamaica going to do?

Brian E Plummer

brianplummer@yahoo.com