A World Bank-commissioned study has identified business process outsourcing (BPO) and agriculture as the sectors that will propel Jamaica’s economy forward over the next three to five years.

The study’s findings were shared last Friday by International Finance Corporation (IFC) executives Martin Spicer and Tatiana Nenova in the Jamaican capital.

According to the study titled ‘Creating Markets in Jamaica: Country Private Sector Diagnostic (CPSD)’, both high-value agriculture and outsourcing services have “strong potential for upgrading and creating more and better jobs” and “show potential to upgrade into higher-value goods and services”.

Jamaica was one of only six Latin American and Caribbean nations to complete the pilot study, which aims to help countries identify private sector growth opportunities in key sectors and assist governments to address any associated constraints to growth.

“It’s a way for the World Bank Group to support governments in having the private sector-lead growth in a country,” Spicer, IFC’s regional director for Latin America and the Caribbean, told Jamaica Observer.

He added that the report is a snapshot of the country’s economy, based on data collected from government institutions, private sector and civil society which identify areas in which the private sector can create economic growth.

“So in Jamaica, for example, two areas are identified in the CPSD — high-value agriculture or horticulture, which exists already — but it’s a scenario where more can be done. The other is business process outsourcing; to move up the value chain in that part of the economy,” Spicer pointed out.

When asked if the World Bank is picking favourites within the economy, Nenova, the IFC regional economics manager, said that the study is based on observation and records of the sectors that are performing well and contributing to the growth of gross domestic product (GDP).

The study, she added, also seeks to identify what sectors are emerging and adding economic value, as well as their investment potential.

“What you’re doing is trying to create new markets, and creating new markets is a very important central tenet of the IFC strategy as a whole. What we’re trying to do is take development to the next level, get the private sector to identify its role; and the way to do it is to see which markets didn’t exist but could be created, or markets that exist but could be expanded. So this about creating markets, not picking winners,” Nenova said.

However, she noted that one of the challenges identifying new markets is to determine what opportunities may emerge in the near to medium term and the reforms that will be required to take advantage of those chances.

Those reforms, she pointed out, must be feasible and practicable, taking into consideration government conditions.

Having surveyed the country’s Vision 2030 plan, the IFC has identified sectors that have growth potential and those that receive strong government support. Those sectors, Nenova said, are well-positioned to create jobs, generate profits and can produce strong return on investment.

“So we are observing what is happening and calling it on data, rather than sitting and picking theoretically what should be the next. So the BPO is growing, and the argument here is be careful of competition, things are dynamic; how can Jamaica stay on top. Agriculture, same thing. The niche market is there… how can you nudge more small firms to get in on that and increase the productivity,” she explained.

But while the horticulture and BPO sectors face external threats, Nenova highlighted that Jamaica was already at an advantage because of how established the sectors are. The focus, she suggested, should be on staying ahead of competitors by fixing education, labour, and productivity.

“The Government has skills programmes in place already. The thing is how to leverage technology,” Nenova said, adding that there may be a skills mismatch between what universities are teaching and the labour force demands.

To this end, she recommended that schools and businesses work together to better identify the future demand for skills, ideas, and technology.

In relation to labour, Nenova proposed that the Government consider reforming visa programmes to attract foreigners to Jamaica. That, she argued, would facilitate skills and technology transfer to the local labour force and alleviate brain drain.

Commenting on the current debate about recruiting foreigners to respond to labour and skills shortage, Spicer argued, “One thing about that is bringing in talented labour can help train the Jamaican labourer to improve their skills that’s — one opportunity. It’s not a threat to have foreign workers here, but more of an opportunity to learn from them through engagement at the company level.”

When both executives were asked if Jamaica could miss the boat by not addressing these challenges, Nenova said it was impossible since these sectors are already growing. However, she asserted that the country could miss “unrealised profitable opportunities” to be a world leader in those industries.

Pointing to the country’s tourism product, she said Jamaica was already a leader in the services industry and was leading recovery in some respects. Moreover, Nenova argued that the threats Jamaica faces are not unique as other countries have to grapple with them as well.

“Brain drain and labour and skills — these are challenges that every single country is fighting with because these are new niches. These are industries we didn’t have 15 years ago,” she stated.

“So, I don’t think there is a danger in Jamaica missing the boat. I think there is a danger of Jamaica missing an opportunity to go even further, to improve productivity even further,” she said.