PRIVATE sector representatives say recent developments allow for optimism towards stablility in the domestic economy, but acknowledge that much more needs to be done to achieve growth.

“Maybe a legitimate response to the lowest interest rates in thirty years, $42 billion in savings, a successful International Monetary Fund (IMF) programme, a wage restraint et al, is ‘I’ve seen this before’. I would say that there has been things like this before but there certainly hasn’t been things at this level,” said Nicholas Scott, chairman of the Private Sector Organisation of Jamaica (PSOJ) Planning Committee.

Scott was part of a team of executives from the PSOJ and Jamaica Money Market Brokers (JMMB) who visited the Observer’s Beechwood Avenue heaquarters in Kingston yesterday to discuss the upcoming PSOJ Annual Economic Forum.

Indeed, much has happened in the past six months, including Government reaching a deal for a US$1.2 billion from the IMF, interest rates dropping to single digits as a result of the state’s debt-swap initiative and a major crime offensive which has seen security forces stabilise the most notorious garrison in the country. And Scott said, as a result, there has been a renewed sense of confidence in the economy. Businesses, he said, have been showing serious interest in a variety of different sectors, particularly niche manufacturing, agriculture, energy and some aspects of tourism (such as health care tourism).

“I think it makes it a lot easier when you can finance those things in the 12 to 15 per cent than in the 25 to 30 per cent, it’s a whole different ball game,” he said.

Scott admitted that while some of the fundamentals have been put in place, the country must now create the framework to stimulate the business environment and achieve economic growth.

“We’re not out of the woods yet for sure,” said Scott, adding “at least being cautiously optimistic, it’s a trajectory that has at least ensured stability and repriced risk, but it is not sufficient to get growth…We need these additional things on top of that.”

JMMB marketing manager Imani Duncan said this will be one of the focuses of the PSOJ Annual Economic Forum, which will feature a keynote address by highly regarded Colombian economist Virgilio Barco. Barco is executive director of Invest in Bogota, an investment promotion agency for the city of Bogota in Colombia. He spearheaded the overseas investment initiative which resulted in a dramatic turnaround in the Colombian economy.

“When you look at the profile of Virgilio, this is a guy who is talking about the tactical, practical things on the ground to get the right type of investments in, as well as how to make sure the local private sector links in to it effectively,” said Duncan.

“Because, as you know, we are missing the linkages,” continued Duncan. “Foreign Direct Investment (FDI) by itself is important, but not necessarily sufficient. Jamaica had tons of money in FDI in the mid-2000’s, yet what do we have for it, minimal growth.”

The PSOJ Annual Economic Forum, of which JMMB is lead sponsor, will be held on Friday at the Hilton Kingston Hotel.