At the public session of the People’s National Party (PNP) 86th Annual Conference on Sunday, in discussing his economic agenda, Opposition Leader Mark Golding commended former Minister of Finance Peter Phillips’s role in what he described as the early “heavy lifting” of Jamaica’s 2013 International Monetary Fund (IMF) programme and committed himself to macroeconomic stability and prudent fiscal management, while noting that was necessary but not sufficient for everyone to benefit.

His first economic agenda item was for Jamaica to become a “gateway to the Americas” as a global maritime and logistics hub, with clusters of related logistics activities.

He emphasised agriculture, including farm roads, cold storage, irrigation, and loans; the blue economy (see my Jamaica Observer article last week ‘Blue and green bond climate business is good business’); and the need for wider collaboration with the poultry, agriculture, milk, and livestock sectors to, for example, improve their capacity through innovation, including through our various local research institutes.

His speech included a focus on the cultural creative sector and critically reducing the cost of energy by taking advantage of the fact that the Jamaica Public Service licence is coming to an end. Interestingly, he mentioned regularising electricity users through, for example, pooling through solar community grids (the latter issue came up in a presentation on Columbia at the blue and green bond conference referred to in my article mentioned above).

He also emphasised land and housing, first by improving related infrastructure and through a combination of allocating government lands for housing (land titles) combined with what he called ending the “extraction of capital” from National Housing Trust (NHT).

Finally, he emphasised education, including the interesting idea of matching “dollar for dollar” HEART/NSTA Trust funds money spent by employers on training.

At this point, it is worth noting that having worked closely with Dr Phillips, Golding had a key role in ensuring that the predominantly financial legislation required under the 2013 IMF programme was actually delivered. A key difference from the previous IMF agreement was that Dr Phillips had agreed to the setting up of the Economic Programme Oversight Committee (EPOC).

At its EPOC press briefing last Friday, 11 years on, as part of its 46th update to the nation, EPOC Chair Keith Duncan announced that Jamaica had successfully completed its latest IMF programme but that gross domestic product (GDP) growth was now slowing.

The virtual Private Sector Organisation of Jamaica (PSOJ) economic conference ‘Crossing the Chasm: The Road to economic Recovery’ in August 2020 was a clear effort by the organisers to build on the 134-page report of the COVID-19 Economic Recovery Task Force, subtitled ‘Rebuild Jamaica’, which, in addition to the then critical issue of tourism recovery (a story which still needs to be properly told), included chapters on financial sector development and the digital economy as well as business process outsourcing, agriculture, and manufacturing and exports. Many of the conference participants had been part of that Economic Recovery Task Force chaired by Finance Minister Dr Nigel Clarke.

In describing how EPOC functioned initially, Duncan observed that the responsible agencies had committed to owned deliverables. When the various ministries and other entities made commitments, they had timetables for delivery, and entities such as the Bank of Jamaica and Ministry of Finance would come and report where they were on a monthly basis. If they were off track, they would advise how they planned to get back on track, as under the IMF programme Jamaica would either “fail” or need a waiver. The monthly reporting to the public provided the necessary discipline, as the ministries were afraid to say they had failed to deliver.

Duncan argued in 2020 that similar monthly EPOC-style “oversight” committees were needed to drive other key supply side economic reforms, for example, land titling, tax simplification, general ease of doing business (government procurement), etc.

Today, in addition to looking back at the COVID-19 task force report, Duncan also believes that we should review the learnings from the process of consultation by the Michael Lee Chin-chaired Economic Growth Council (EGC), which is reported to have had more than 500 meetings.

The key objectives outlined in the Economic Growth Council were to maintain macroeconomic stability and pursue debt reduction strategies; improve citizen security; improve access to finance; pursue bureaucratic reform to improve the business environment; stimulate greater asset utilisation; build human capital; harness the power of the Jamaican Diaspora; and catalyse the implementation of strategic projects, which we will review in more detail in later articles.

Duncan believes the key to faster growth remains how to cure Jamaica’s “implementation deficit”, a key focus of the book A Growth-Inducement Strategy for Jamaica in the Short and Medium Term, jointly edited by Donald Harris, Stanford economics professor (emeritus), and then Planning Institute of Jamaica (PIOJ) head Gladstone Hutchinson in 2010/2011.

At that time, Duncan had observed that the book’s contents provided an excellent summary of some of the needed supply side and social reforms on which there has been limited progress outside of the main macroeconomic and financial sector reforms that were driven by EPOC and the IMF. He had also observed then, like Golding now, that while our current macroeconomic stability was a very important precondition to faster economic growth, it was not sufficient.

The key conclusion from this is that to tackle our implementation deficit Jamaica needs to take the same “disciplined” approach as had occurred under EPOC in meeting the IMF targets for all the other required reforms.

In his book and in other writings, Professor Harris has argued that in Jamaica this can only occur with the power of the prime minister, about which we will say more in future articles.

Keith Collister