Monday, August 10, 2015

Time for economic independence


ON August 6, 1962, Jamaica gained political independence, and many people watched the Jamaican flag raised while the Union Jack was lowered for the last time. This symbolised Jamaica's new-found political independence and was indeed cause for celebration.

Over the 53 years since then, Jamaica has achieved a great deal and, personally, I have seen much development in infrastructure and other areas (although I wasn't around in 1962).

However, one thing that has eluded us is economic independence.

So although we were given the right to govern ourselves, we have never truly experienced what it is really like to be a prosperous country. And so we have changed from being told how to manage our economic affairs by our colonial masters, to now being told how to do so by the holders of our debt stock.

This is similar to a young man attaining adulthood, but still having to live under his parents' roof and abide by their rules, simply because he wasted his opportunities at school.

In my view, however, today we have a great opportunity to change that path of dependence and move towards economic independence. It has taken us 53 years to get here, but I think the opportunity exists now more than any other that I have been conscious of.

And I say this because the economic and fiscal programme we are pursuing allows us to change our fortunes.

The macroeconomic indicators are all trending in the right direction, and confidence -- both local and international -- is high. In addition, all of this is happening within the context of a recovering global economy and greater opportunities for Jamaica. Importantly, for the first time since 2004 we have recorded a surplus on our current account balance.

On the other hand, we also have the grand opportunity to once again snatch defeat from the jaws of victory, as we have done so many times in our past -- which is why we are involved in our 13th IMF agreement.

Economic stagnation

We are at a point where we can either do the right things to make the economy grow, or we can watch the economy stagnate. Stagnation of course means continuing economic dependence, and I don't think there is anyone who wants that to happen.

In order for us to realise the growth needed to lead us to economic independence, we must do certain things -- especially leading up to a constitutionally due election. That will require focused and strong leadership.

Both the prime minister and the minister of finance have stated their commitment to the economic programme.

The irony is that by making the right choices we can also improve the living conditions of most Jamaicans. I say most, as there are some people who will no longer benefit from being connected -- because the market will distribute rewards instead of connections. This process has already started with the legislative and fiscal reforms we have already undertaken, and so I expect it will continue.

The prime objective of any government must be to improve the lives of all its citizens. In order to do so, however, we must establish the framework for proper governance, finances, and behaviour -- just as is done in an organisation.

Here are a few things that must happen:

First, the government must have policies that facilitate greater opportunity and growth for both individuals and businesses. Fiscal policy, especially, must be geared towards that. In many respects fiscal policy in Jamaica still has the objective of revenue collection rather than economic facilitation. There is too much emphasis on penalising businesses and people for the slightest of errors, with no attempt being made to expedite their progress.

Secondly, if we are to move this country forward (even with the best fiscal policies) we must ensure that there is law, order, and discipline. We cannot continue with the mantra of "Jamaica No Problem", which everyone interprets as "Do whatever you want". So road discipline and respect for the peace and quiet of others must be at the top of the list.

The third thing in support of a disciplined society is that any progressive society must have a properly functioning justice system, from enforcement by the security forces all the way to the court system. Without enforcement, discipline does not work as justice delayed is justice denied.

Drought of action

But before we can see any serious improvement on the fiscal and competitive sides, the culture of the public sector must be transformed to one of efficiency. This is by far the biggest complaint in doing business. This has been on the table for far too long without action, and the irony is that unless we address this, then no meaningful economic development will come any time soon. This must include accountability for inaction, such as that which has led to the effects of another drought.

Leadership is of course going to be critical. Leadership will have to do the right thing for the country irrespective of the opposition or the political expediency. The country is crying out for leadership at all levels, and without it we all will continue to suffer.

All these factors are related and must be done together if we are to achieve real economic independence. Importantly, we must change the way we think and stop looking at short-term objectives while sacrificing the long-term benefits. Only then will we be truly on a path to sustainable development and prosperity.

The question is, are we committed to doing what is necessary and right to improve the long-term prospects of the Jamaican people? This is not just a responsibility of government, but for all of us to think about after 53 years of trying.