Friday, April 24, 2015

What does economic and social change look like?

image

PERHAPS the question I get asked most frequently is about the economy and the prospects for it. One of the things I hate the most is when people engage you on the economy and ask about the prospects, but then don't give you a chance to answer and then go on to curse everyone who is living and dead, about the difficulties in the economy. They then go into the history of our economic mismanagement and then naturally their argument progresses to placing blame on one political party or another. All of this before I have answered the question, which always leads me to wonder why they don't call a talk show to vent rather than ask the question.

Many times, however, people will have doubts about where the economy is going, and whether we are seeing any benefits from the economic programme, as admittedly things are not easy. I will be the first to admit that the past few years, since 2009, have been very challenging for some businesses and individuals.

So when I say to them that I am optimistic about the changes being made and where I see the economy going, they are surprised. Some even go as far as to say that when analysts like us speak that way, we are being spin doctors for the government. However, when we say things are not going well, under both administrations, they cheer you on. It seems they just want to hear bad news all the time. I can only imagine how such an attitude affects one's perspective.

Hope

The truth, however, is that we need to develop the ability to recognise when there is hope and when there is not. That ability helps make a successful entrepreneur, one who might be having a difficult time in their business but can still see the forest and not just the trees.

Not everyone has this ability, but what everyone can do is try to develop an open mind to see other people's reasoning. It is this tolerance of opposing views that enables us to develop our own thoughts.

The question to be answered is: are we making progress under the current economic programme? My view is yes we are, and, as I have said many times before, this time we stand a better chance than under prior IMF programmes.

Why do I think so? Because for the first time we are making necessary legislative changes to accompany the fiscal changes. And, as various analysts have said many times in the past, the only way any fiscal or economic reform can work is if it is accompanied by structural changes. The legislative agenda has provided the opportunity to change the structural environment to create a more competitive economy. So I don't think that anyone would disagree that this programme includes the much needed structural reforms.

There is also no doubt that the economic environment is getting more competitive and more challenging for many businesses and individuals. The reason for this is that as a country we were used to operating in an economy with less competitiveness, with many people and businesses benefiting from contacts and government welfare. When those avenues lessened it inevitably became a more challenging environment.

The role of bodies like the PSOJ is to help with that transition to a more competitive economy, where the playing field is level for all and the bureaucracy and societal conditions do not stand in the way of innovation or economic activity.

Recognising positive change

What we must ensure, however, is that while we acknowledge the difficulties, and the things that still need to be improved, we must also be able to recognise when positive changes are happening and the direction we are moving in. In other words, how do we recognise when an economy is positively transforming even while challenges are there. For example, in the two years after 2008, the US economy was still going through significant challenges, and the instinctive reaction globally was to move to austerity measures as Europe did. But the US administration, however, stuck to its guns, even in the face of opposition, and the end result is that the US economy is now the locomotive of the recovery.

It is also going to be very important for us not to prevent our own development, in the face of the immediate challenges, by deviating from the path we are on. Many times in the past we have embarked on fiscal and economic reform programmes, and at the first sign of difficulties we start running fiscal deficits and restart the process of decline all over again. This is how we have ended up where we are today.

I recognise the difficulties we face but all the indicators are showing me that we are on the right path. These include (i) much lower inflation and interest rates, with the difference between US$ and J$ interest rates much reduced; (ii) reducing balance of payments deficit; (iii) a more stable exchange rate; (iv) near zero fiscal balances; and (v) increasing business and consumer confidence.

But even with this, we must still recognise the challenges we have and must address. These include bureaucracy, crime, and governance. What we must do is address these challenges constructively, deliberately, and together. In other words, let us criticise each other, as this is good for progress, but let us do so rationally and constructively.

So what we must be able to do is understand that any transformation, including economic and social, to a better model, will always cause dislocation. What we must do though is forge ahead with any plan we have properly thought out, and be able to see the long-term outcome while at the same time dealing with the challenges that occur on the way to that desired outcome.

Friday, April 17, 2015

How we think impacts our development

image

ONE of the things I encourage my staff to do is feel free to be critical of me as CEO of the Private Sector Organisation of Jamaica (PSOJ), which leads to having an environment where we can all be critical of each other.

We therefore have an open atmosphere where we can all speak to each other about; ideas for growth: what areas we think someone can improve in and, importantly, to recognise achievements. This creates an atmosphere where everyone feels comfortable about contributing to the progress of the organisation.

I see the same philosophy with many private sector leaders I have worked with -- such as Dennis Lalor and Don Wehby -- who always ask for feedback before making any comments whenever we discuss any issue. I find that the present PSOJ officers, led by William Mahfood, are also always interested in feedback. This philosophy is what makes for their own success in many respects, as the ability to listen, especially to suggestions for improvement, is probably one of the most important traits you will see in any successful leader.

In fact, I have found that many persons who have failed have an inability to constructively accept criticism. In other words, they usually end up "shooting down" the messenger and not listening to the message. This, of course, results in them only attracting "yes men" -- when nothing could be more damaging to that person's development.

While that criticism may come across as harsh, it may be necessary given the circumstances. I we want to develop, we have to learn to listen to the criticism, rather than just the form in which it is delivered. That is not to say that criticism must not be respectful and constructive, but even that is sometimes essential for overall development.

image

One instance I can think of when harsh criticism is necessary is when a group of us are cycling. There may be a group of 20 to 30 people all moving at upwards of 25 mph and just 6 to 12 inches behind each other's wheel. In those circumstances, we can understand when we do something wrong and the person behind us tells us two "choice words". While we might tell them one back, we realise that any error can cause serious physical damage. In such a situation no one is offended by what they are told.

Party colours

This inability to accept constructive criticism is one of the things that has held back the development of our country. The emails I receive about governance issues are always the same, no matter which political party is in power. What is amazing is that the same person can have two very different thought processes on the same issue depending solely on which party is in power. This is one of the primary roadblocks to our own development as a people and country.

It is strange that the politicians themselves are much more receptive to the constructive criticism than the people who follow them. And it is not that the politicians tell them to think that way. In fact, it is much easier and acceptable for me to sit down with the politicians and give them my own views -- which they accept -- than to have a discussion with some other people who are supposedly intelligent thinkers.

This says a lot about our level of development as a people.

I must admit, however, that there has been much improvement since the 1970s and 1980s, for example, when we used to kill each other over our individual political views. The irony is that many of those who would want to go back to that way of thinking do not understand how much people suffered during those times, as they were either not born yet or were not old enough. I was young during the 1970s, but I can remember those days very well, and so people like me will appreciate the need for the constructive dialogue that many have sacrificed for.

Vision 2030

If we are to develop as a country and to achieve the elements espoused in Vision 2030, then we can't focus only on infrastructural and economic development, but we must also change how we think and communicate with each other.

The economic reform programme is an example. My own view is that the economic agenda, as outlined by Minister Phillips, is certainly the direction that we want to move in. Fiscal and legislative reform is essential and is a necessary ingredient to form the basis of any economic and social development. It might not be sufficient, but I don't think that there can be any argument about the need for these reforms.

There is also a need for public sector transformation, skills training, and focusing on certain strategic investment decisions, such as the Agro Parks, KCT, highway development etc.

But even though all agree that there is a need for public sector transformation and efficiency, there is disagreement when initiatives under the reform are being undertaken, without any rational explanation for the disagreement or any alternative being offered. So the question is, what is the difference to someone agreeing that greater efficiency and better management is needed in the public sector and recognising that same need for management around ChickV and the Riverton Fire -- which both cost the country hundreds of millions of dollars?

The short answer is that the only difference is our inability to accept criticism constructively, which is really what places us at a disadvantage.

On the other hand, there are some of us who will also criticise any policy put in by a government that we do not support -- even though we would support it if put in place by a government that we support. And this disease seems to be contagious as it is also affecting the US now.

If we want to move forward and develop as a country, we must be able to accept good and bad criticisms, and look at the message not the messenger.

Friday, March 20, 2015

Why won't the private sector invest?

LAST year I sat on a panel to discuss the state of the economy. Someone in the audience correctly stated that much work was being done by the government to improve the business and economic landscape, but asked why the private sector will not invest if the government has done its part.

I told him that he was also a part of the private sector and suggested if he saw the opportunity to invest, then he should not want anyone to invest before he does, and that he should make the investment. And even if he has to secure a loan, he should take the risk or he could use his savings to do so. His response was that he would not risk his meagre savings in an investment, and he didn't want to borrow any money either.

I asked him who he referred to as the private sector, as I thought that everyone who is not a part of the public sector is in the private sector.

This illustrates the view that many persons have: The private sector is someone else, not me. Nothing could be further from the truth.

Consequently if you do not see an opportunity that would cause you to risk your own money, why do you expect that there is a private sector out there that will?

But the question persists. Why doesn't the private sector step up to the plate, now that the government has done so much to facilitate businesses? However, I would pose the question this way: Is this the right time for me to make an investment, and if my answer is yes, I would ask why no one else has made the investment; not to urge anyone else to invest before me but to assure myself that my own assessment is right. I don't think that I can ask someone to risk their own money when I am not willing to invest mine.

I do agree, and have said repeatedly, that the current reform programme is moving in the right direction, with the various fiscal and legislative adjustments being made. This has resulted in Jamaica moving up 27 places in the Doing Business Report; being named the best place in the Caribbean to do business; and having business and consumer confidence at yearly highs. I get a real feeling also that businesses are looking at even more investments, which will begin to show and pay off for the economy.

We must understand though that (i) mobilisation of capital is not easy, so even when there are positive changes capital just doesn't appear out of thin air; (ii) even though confidence has improved it doesn't mean that we are now more competitive for investments than other countries, as they are not just sitting down and waiting on us; and (iii) regaining enough confidence for action is a process, as we have had more than 40 years of mistrust between the private and public sectors. If you have had even one year of mistrust in a relationship and you are making an effort to improve it, does it go back to where it was overnight?

There are, of course, many things that erode trust and confidence. These include:

* Even though this year we have had a more proactive budget process, we must remember that every year the country (including businesses) holds its collective breath about what new taxes are coming -- removing the predictability of business. Any one tax measure can change a business model in an instant.

* Many persons who invested in government paper saw their cash flows and values affected by the first debt exchange in 2010, and subsequent ones. These actions changed the return and cost of capital overnight, even though unavoidable.

* We must also remember that we have just gone through a raft of legislative changes, which still continue, and it takes time for businesses to assimilate all the changes, which is the prudent thing to do before investing.

* The bureaucracy is still a significant issue, especially for those SMEs which cannot afford a courier service. It still consumes a lot of time to pay taxes, despite the improvements by TAJ. And attempts at the improvements have not been smooth as there have been reports of challenges with the new forms and new system. The bright spot is that TAJ's response has been very good, and they continue to be an example of good customer service in the public sector. On the downside we are told that the cost of exporting to New York from the Dominican Republic is less than the cost of getting the container on a ship here.

* Crime is still a problem, even though there have been improvements. Much of the crime is domestic violence but the perception of an unsafe environment still exists.

* Last year drought conditions cost farmers significant losses, while the NWC continues to have the majority of its water unaccounted for and the dams are full of silt. Also last year ChickV resulted in an estimated 13 million man hours lost, and approximately 0.5 per cent of GDP. Between the drought and ChickV the GDP lost was around one to 1.5 per cent.

* Now we have the Riverton fire, which has caused untold health problems, and many businesses have lost hundreds of millions in revenue and citizens have lost income. Businesses also have to pay employees wages despite losing income to a crisis that could have been avoided.

The fact, though, is that there have been significant investments over the past year, but long-term investing is not like buying and selling, which is what we have become accustomed to. It takes time to show returns.

So when we next wonder why the private sector is not stepping up to the plate and investing as it should, remember that the private sector is everyone outside of government, and if we do not feel like risking our own money in investments, then why do we ask others to do so? The other way the question can be asked is, why do we not buy the domestic product even when it is much more expensive than the import, or why do so many of us choose to migrate instead of staying and helping to build Jamaica?

Friday, March 06, 2015

ICAJ 50: the accountant’s role in development

THE Institute of Chartered Accountants of Jamaica (ICAJ), of which I am the current president, is celebrating 50 years of existence, having been formed in 1965. After reflecting on the importance of the accountancy profession, and considering where we are as a country today, I thought it would be good to highlight the importance of the accounting profession to Jamaica.

This is especially in light of a problem I see many SMEs facing; that of improperly prepared accounting records. This not only restricts their growth potential but also causes challenges with accessing credit. Even when they are able to access credit the cost of funds is higher because financial institutions cannot do a proper credit assessment.

Many business people do not see the importance of accountants, and records, until it is too late. So the emphasis is on producing and selling products, or services, but no emphasis is placed on record keeping, filing tax returns, and other proper governance practices. SMEs need to understand the importance of this for their own growth and development.

This is where the accountant plays a very important role in development of businesses, at the micro level, and ultimately economic and social development.

The first thing to understand is what to look for in an accountant. Just like when you are buying an appliance there are certain brands that are tried and proven, it is also important to ensure before you buy accounting services that you are getting good quality.

Many people use accountants who are not suitably qualified to prepare their records,. I have seen this time and time again. Usually the customer complains about the accountant's service after the fact. And many times we discover that the accountants are not members of the ICAJ, and so we have no jurisdiction over them.

This is where the ICAJ, and the Public Accountancy Board (PAB), come into play, as these two bodies regulate the accounting profession and by extension issue membership and practising certificates to their members. One can therefore be reasonably assured that the quality one gets with someone holding this certification is of an acceptable standard.

The PAB is the regulatory body for the profession in Jamaica, and is so empowered to do so by law. The ICAJ goes further by certifying accountants as chartered accountants. In other words, even if you have passed all the accounting exams in the world, you cannot legally hold yourself out to be a chartered accountant unless you are a member of the ICAJ. Anyone who does that is liable to prosecution.

The chartered accountant title gives assurance to the public that the accountant is of a minimum standard, as he must pass certain exams; have a certain number of years of experience; be recommended by two members; pass an ethics exam; and not have any integrity issues.

Earning the right to be called a chartered accountant is a rigorous process, as even after all of that you are interviewed by a panel if there is anything that needs specific answers. Acceptance is not automatic.

The 2008 global financial crisis, for example, was partially caused by a lack of proper accounting reporting, as the valuation of securities was not properly reported. Assuring that they had been may not have prevented the crisis, but it would have alerted people about the problem before it became so big. In Jamaica, we would have stood a better chance than the US because of our use and application of IFRS, unlike the US standards in place at the time.

If we are going to move Jamaica's SMEs forward, then we must understand the important role that properly qualified accountants play. Look at the capital markets and companies on the stock exchange. Many people purchase shares on the exchange as long-term investments for their retirement years. The quality of the audited financial statements is very important, as if the reports are inaccurate, then it can lead to a lot of heartache in the future when and if the inaccurate reports affect the viability of the company. This is why I always urge people that the first section to look at in a set of audited financial statements is the audit report -- because if it includes a qualification it may not make sense to rely on the rest of the report.

The ICAJ and PAB recognise the need to protect the users of financial statements, and have put in place practice monitoring (quality assurance) and other programmes to reduce the risk of inaccurate reports being fed to the public. But as always it is up to the "buyer to beware".

In other words, check the credentials of the accountants you do business with -- and whose reports you rely on. One way you can do that is by checking the listing of members on the ICAJ website, or simply calling the ICAJ.

As the ICAJ celebrates 50 years of existence, it is appropriate to highlight the important role of accountants in national development. But as with any product or service, the user must be fully aware of what is being purchased.

Friday, February 27, 2015

Indiscipline and lawlessness promote social inequality

image

LAST week I spoke about the lack of proper parenting skills being Jamaica's fundamental problem -- and the root cause of almost every challenge we face.

The reality, however, is that much of this parenting crisis comes from a lack of discipline and order in the society, in many instances promoted by people who should know better. In other words, many of our leaders, especially policymakers, are aware of the unethical and sometimes illegal social issues we face, but do little to address them. And so in many ways, ignoring these issues means that we are complicit in the consequences.

Just last week, Gary "Butch" Hendrickson commented on something I had really not reflected on before. Butch indicated that the violation of the Noise Abatement Act was actually one of the primary causes of social inequality.

At first I didn't understand what he meant, but he went on to explain that when a child in a depressed community has to deal with music being played at loud decibels way into wee hours, that child loses a good night's sleep and is not properly prepared for school the next day. In addition, the child has to get up early and hustle on public transportation to go to school, often without the benefit of a proper breakfast.

Contrast this to a child from a middle- or upper-income family, who may live away from night noises, or whose family can insulate him from them so he can get a good night's rest and wake up refreshed and ready to learn. In addition, that child can sleep longer because he will be driven to school and will also receive proper nourishment before leaving home.

In both cases, each child is born with the same physical and mental capacity, but because of different circumstances there will more than likely be different results. The child from the inner city may rise up against the odds, but will have to do so under more challenging conditions.

It is also important to point out that apart from lack of sleep and proper nutrition, the child from the lower-income family also faces the challenge of a daily assault on our less-than- adequate and often abusive transportation system. Not only must this child wake up one or two hours earlier, but must also fight with the disorganised system, and be pushed around and sometimes shouted at by transport operators who want to maximise their earnings in the midst of the indiscipline on our roads. We can also talk about the physical danger they face with the poor driving practices of many transport operators.

This lack of order also extends to our crime problem, as the child from the inner city is confronted more directly with many of the crimes being committed and interfaces directly with the outcome of crimes -- even if not committed against him. Again, the child from the middle or upper class is insulated from many of these crimes.

Many children today face issues of abuse -- physical (including sexual) and mental. This occurs at all levels of society, creating social inequality by giving the abused child a greater reason to fail in life.

This is one of my pet peeves, as for the life of me I cannot understand why the child authorities and court system find it so difficult to come to grips with child abuse. This should be the priority of the justice system as our failure to adequately address child abuse just creates more criminal deviants in the future. Nor can I understand our failure to hold accountable those parents who take to the streets to sell or beg with their young children at their side. This is in plain sight, but nothing is done about it.

I have personally reported (around twice) a woman I see on Sundays at a gas station seated with two or three young children begging for money and food. One of the children (a young lady) seems to have grown up and is now begging as well. Still nothing is done about it

So after reflecting on what Butch said, it came home to me. In just that one comment he said a whole lot about why many families face generational poverty and failure, and why there is a divide between income classes as it relates to probability for success.

In other words, our failure to impose discipline and structure on our society has promoted the persistence of social inequality, which in turn is at the heart of our labour productivity and ultimate economic issues. No passing of any IMF test or even a proper growth agenda can solve this problem sustainably.

If we are to solve this, we must first consider it a national crisis and it must be dealt with as such by the authorities.

Just as we have a major focus on murders, we must give the same attention to indiscipline and lawlessness. For example, the stop lights in Kingston are now are like Coronation Market with window wipers, vendors, peddlers, pedestrians crossing at will, and people just seeming to be hanging out. This seems like a low-hanging fruit. If the stop lights are cleaned up, that would be such a big boost to the perception of order -- instead of ignoring it and creating an industry that we soon say we can't get rid of because it is creating a livelihood for persons.

We must also get serious about imposing the Noise Abatement Act, and understand the social inequality and injustice we promote when we allow people to disturb others with noise (not just music) any time of the day. We must also get serious about prosecuting child abuse cases, and also issue harsh penalties to adults (and parents especially) who know about child abuse and do nothing about it.

We must also support the JUTC in its effort to clean up the transport system and not allow preaching, eating, playing music, or any other disturbance to passengers. Personally, I would like to see a proper school bus system. And we must deal with undisciplined drivers and other users of the roads -- such as pedestrians who ignore traffic signs, cyclists who ride on the wrong side of the road, or people who illegally park on Knutsford Boulevard (sometimes while in the car) in plain view of police.

This is not about passing new legislation, as that is already in place. It is about the will to enforce it and to realise that our culture of giving a man a "bligh" does nothing more than create indiscipline and lawlessness, which affects negatively the same man we don't want to "fight against". It is only when we start to do this that we can provide equal opportunities to all for true social and economic development. Each of us has some responsibility.

Friday, February 20, 2015

Understanding Jamaica's fundamental problem

This year we will have the opportunity for a one and a half month debate on the revenue and expenditure estimates before the start of the fiscal year. This is very good governance practice and the minister must be commended for this initiative. No doubt over this period there will be much talk about the fiscal accounts and the economic programme. Specifically there will be talk about taxation and the macroeconomic targets such as inflation and the exchange rate.

Going out to Hellshire on Ash Wednesday though, I was reminded that the fiscal accounts, macroeconomic targets, economic activity, and crime are nothing more than the symtoms of the underlying challenge we face as a country. In fact I would go further to say that given the progress we are making on the economuc front, that if we stick to our guns then the mjor problem we will face in a few years time will not be the economy or fiscal accounts. In fact it is very possible that we wll see a much more competitive economy.

The fundamental problem we face as a country is on the social front, as based on my observations, the primary problem we will be that a significant part of our workforce will not be equipped for a competitive economy. So that even if we are to see growth upwards of 3 percent consistently, there is still a part of our population that will be marginalized. In our 52 year history, the only time that we had actually tried to address the social issues were really in the 1970s, under Manley, and even at that time it was not done with the purpose of sustainable inclusion in the economy for all but rather fixing certain social challenges faced coming our of colonialism.

I was reminded of this when i went out to Hellshire, as I think the people out there are a representation of the ordinary Jamaicans, inclusive esepcially of young Jamaicans. And this culture, although I saw it at Hellshire, does not only reside with the persons there but permeates even our work environment. So the truth is that we could possibly see economic growth with little or no inclusion of some of the population because many persons do ot possess either the skills, work ethics, or social behaviour required to compete internationally. And the end product or service consists significantly of labour or thought input, which reflect the underlying problem of our economic challenge. That of labour productivity.

When one thinks about the crimes being committed (gang related and domestic in particular) it sends us a lear message that something is wrong with our socialization process. And we must remember that economics is a social science and so what happens in an economy is highly dependent on the social skills and behaviour of the persons in the economy.

So while at Hellshire today I noticed a few things. These included (i) a man driving a bus load of people while smoking a ganja spliff; (ii) young men smoking ganja spliffs on the beach; (iii) young men with their shorts falling off exposing their underwear; (iv) women with children around them inappropriately dressed; and (v) the suggestive music being played with the young children subconciusly absorbing all the sexually explicit and violent lyrics.

The behaviour also reminded me of the conversations I have all the time with a fellow cyclist, Dr. Sandra Knight, about the significat number of child abuse cases perpetrated many times by the father who goes unpunished and the generational cases of child abuse in a single family. These of course continue primarily because no one is held accountable in the main.

This also reminds us of the 14 year old girl that was rcently killed and placed in a bag and admitted to by a businessman, but also found out that at 14 she was pregnant. This again brought home a stark reality that there has been no report of accountability for the parents of this 14 year old, which should have been reported in the investigations also. A facebook discussion on the matter also revealed another weakness as some women were saying that the mother should be held accountable and I had to remind them twice that both the mother and father should be held responsible, bringing home the fact that we are only too happy to absolve the fathers of the responsibility, even though I can say that today many many fathers are stepping up to the plate even more than many many mothers.

It seems to me therefore that none of the economic and fiscal challenges can be solved without first looking at the social fabric of our beloved country. It is certainly not unique to Jamaica, as even the great USA seems to have some significant deviant social behaviour, and we certainly don't need to adopt some of those types of behaviour. I am for example reminded that children can still freely express their religious beliefs and read the bible in schools in Jamaica, which was recently reported as a problem in a US school.

In other words if we are to truly make Jamaica the place of choice to live, raise families, work, and do business it is not only important that we focus on macroeconomic and quantittive targets, but even more critical that we address the societal behavioural issues, which I really hear no one speaking about. So children under the age of 16 continue to have children without the appropriate accountability in many instances, and a signifcant number of young men find themselves "digging out their palms on the street corner". I must say though that in all of this I do find some very hard working and focussed young persons, and they will do well based on their attitudes. But similarly there are many coming out of the universities with very poor work ethics and attitudes.

I think that in many instances that leadership is to be blamed for this and the most important leadership is that of parenting. This I think is the fundamental problem we face. We have taught our children to be many things but for around two generations now we have seen a significant decline in parenting skills. When I was growing up parents taught their children how to behave around other adults, use a fork and knife, respect for other children, and other social skills. This I think is the missing in our social fabric that contributes to our labour productivity issues that cause our economic challenges.

Who will bell the cat?

Friday, January 16, 2015

Low-hanging development options

MOST times when we speak about economic and social development, many of us think about the cost of infrastructure or costs associated with the government providing stimulus to the economy. Or if we talk about reducing crime, then one of the first things discussed is the need for more resources for the police.

The truth is many things can be done that do not require a great deal of resources. This is the same as making positive changes in an organisation. In many instances, the really positive changes that are needed to kick-start a successful organisation do not have any costs attached to them.

In fact, spending money can make the situation even worse if the requisite action is not taken to set the stage for a new development path. Similarly, we often hear that the police force and the health sector need more resources, but putting money into a broken system does not necessarily fix the problem. Leading up to the 2008 recession, for example, we saw more and more funds being allocated to health, security, and education, but those sectors actually worsened over that period.

We face a similar situation in Jamaica today. We have a broken system, and putting more money into it without the necessary fundamental changes will only cause us to be in greater debt. This is why the adjustment under the economic programme is so important — not just throwing money at each and every outcry that we hear. We have done that in the past, where we have been in the middle of an adjustment programme and as soon as we near an election, or as a sector cries out, we resume the old ways of borrowing money to ease the cries before polling day. And so we start the whole process again and again. The only difference being that we start from a worse base all the time.

Low-hanging fruit can create significant change without any significant cost. There are four main initiatives that can be taken to bring positive development. They will require strong support from the citizenry, who regularly complain about the country's governance. This is an opportunity for us to turn around the country with little involvement from politicians. But are we willing to take the personal responsibility to do this? Much of a country's development rests in the hands of the people. It is only when the people decide they want a better country that any improvement happens.

The first initiative is the cost of health. Approximately 70 per cent of the cost of health in Jamaica has to do with non-communicable diseases (NCDs), otherwise known as lifestyle diseases. These include things like diabetes, high blood pressure, and even some cancers. Jamaica • billions on NCDs each year, much of it scarce foreign exchange for treatment drugs. In addition, much of the individual health costs relate to NCDs. But the fact is the great majority of these diseases are avoidable. If we behave differently when it comes to nutrition and exercise, then the country's fiscal accounts and balance of payments would benefit. In addition, the cost of individual health insurance would be significantly reduced. No government policy can force this to happen. It is a matter of personal choice.

The second initiative relates to our environment. We know the challenge of garbage collection, and we rightly hold the NSWMA responsible when they fail to perform this critical function efficiently. But a big part of our environmental challenge comes down to our own personal choices. The degradation of the environment has a deleterious effect on Jamaica, particularly because we are a tourist destination. Apart from the negative effect on tourism, it also can be the cause of natural disasters caused by flooding etc. The result of not taking care of our environment is that it can cost us billions in f o re g o n e revenue from tourism, and every time we have a natural disaster it costs the country tens of millions of dollars. The irony is that much of the cost from environmental effects is because of actions by citizens, who pollute the gullies and other parts of the environment.

The third area is law and order. If we are to achieve vision 2030, then it is going to be important to develop a society that is disciplined and adheres to the rule of law. Indiscipline on the roads and non-compliance with the Noise Abatement Act are two areas where citizens can exercise control. Even though the government is responsible for enforcement of these laws, the fact is much of the responsibility lies with the citizens, who are the ones who break the law. This is tied to enforcement, which is a primary responsibility of the government. Another area of enforcement that we disregard but which will lead to a more ordered environment is the zoning law.

The final area is a huge negative for investments and business — public sector bureaucracy. Even though the transformation of the sector will require some amount of funds, the fact is much can be achieved by just changing the attitude of the workers. An example of where this has worked is the Tax Authority of Jamaica, which has not only made legislative changes to be more effective, but more importantly is transforming the approach to customer service delivery.

These are some of the lowhanging fruit that must be picked, to cause serious transformation in the economy and social lives of Jamaicans. Even if we were to spend money on these areas, without the change in behaviour by us Jamaicans, these areas will not improve. The role of government is enforcement, but if we as Jamaicans truly want the country to advance, do we need to wait on enforcement or should we individually be making the change?

Therefore, even while we grapple with the need for funds, we should also realise that much of what is needed to transform our economic and social fortunes really comes down to the will of the government and of us the people to want a better country.