ECG says current focus is economic recovery as COVID-19 tramples growthFriday, July 10, 2020
Four years into the much touted 5-in-4 growth agenda, the Economic Growth Council (EGC) has said that the realisation of its projected target was not achieved and has been worsened by the severe impacts of the COVID-19 pandemic.
Speaking with the Jamaica Observer earlier this week, executive director of the council, Senator Aubyn Hill, said the pandemic has shelved almost everything in the world as economies and business activities slump into decline.
“Clearly we haven't made 5-in-4, but what has changed everything is COVID-19. COVID has not only taken us off growth, but according to the minister of finance, we probably will contract by 5.1 per cent this year. All arrangements will have to be rethought and we have to first get our economy back on balance before we even look at jumping ahead,” he told the Jamaica Observer.
Hill said consequent to the biting impacts of the pandemic, the focus of the EGC is to return a contracted economy to growth.
“Our main job right now is to try to do things that will get us out of that 5.1 per cent hole that is projected — [currently] we're not even at growing as with other parts of the world.
“No economy is growing — what economies are trying to do is find their way back to some equilibrium and out of the economic crater that COVID has dropped all economies in,” he stated.
The ECG, which came into existence in 2016, was commissioned with the task of ensuring the achievability of five per cent growth in gross domestic product in four years (5-in-4). The council is chaired by well-known businessman Michael Lee-Chin.
The executive director maintained that 5-in-4 was only a projection which was to be used as an ambitious benchmark that would take the economy to sustainable growth. “For the 10 years before 2016 we had an average annual growth of 0.2 per cent. What Michael [Lee-Chin] was doing was setting a very stretched aspirational target,” which, Hill said, has been taken to an average of about one per cent during the projected period.
Last week, in responding to questions from the Public Appropriations Accounts Committee, which inquired about the council's failure to achieve the stipulated growth, Hill said the target, if achieved, would have benefited the country greatly, especially in helping to take a lot of people out of poverty.
“I would have hoped that we would have made at least half. I know why we haven't made half but when we get through COVID there are clear plans of what will be done,” he said,
When asked about what is to come, Hill said the ECG would be working with the relevant offices to get the economy back in a place where it used to be, then jump off to growth.
“It will take time before we get back to where we were. The EGC will have to rearrange itself to work more closely with the State apparatus, the ministries, the agencies, the departments and the private sector to get our economy back on track. It's not so much talking about 5-in-4 growth but about getting our economy back on track to where it was to be able to spring forward from there,” he told Caribbean Business Report whilst noting that country was now way below the 1.5 - 1.9 per cent growth that existed before.
He said the fast-tracking of some industries will be very critical in propelling the economy forward.
“We're going to have to focus a great deal on agriculture. A wide range of agriculture where we grow a lot more of what we eat. Use our yams, potatoes, vegetables and fruits a lot more instead of having to import them and then get into agro-processing and storage. We also have to digitise our country so it becomes more efficient. We need to develop that digitised backbone that will help our people to leap frog above the normal developmental arrangement used in the past and get ahead to where we can get back to real economic growth.
“We're going to have to do a lot of things differently but we're going to have to buckle down and dig ourselves out of an economic hole caused by the COVID pandemic,” he said.
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