Businessuite News24
Economists Hail Jamaica’s Sustained Debt Reduction as “Exceptional”
Jamaica is being hailed as “exceptional” for achieving sustained reduction in the public-debt-to-gross-domestic-product ratio (GDP) despite global financial crises, pandemics, and other emergencies.
In a paper titled ‘Sustained Debt Reduction: The Jamaica Exception’, authors Serkan Arslanalp, Barry Eichengreen and Professor Peter Blair Henry, noted that the sharp, sustained reductions in public debt are outstanding “because public-debt-to-GDP ratios have been trending up in advanced countries, emerging markets, and developing countries alike”.
The paper was presented at the Brookings Institute in Washington on Thursday (March 28).
“Governments have borrowed in response to financial crises, pandemics, wars and other emergencies, resulting in higher debt ratios. But only in rare instances have they succeeded in bringing those higher debt ratios back down once the emergency passed,” the paper pointed out.
In the case of Jamaica, the Government was able to cut its debt ratio in half from 144 per cent of GDP at the end of 2012 to 72 per cent in 2023.
The economists said the achievement was despite vulnerability to hurricanes, floods, droughts, earthquakes, storm surges and landslides, noting that Jamaica is ranked as the third most disaster-prone country in the world according to the Global Facility for Disaster Reduction and Recovery.
“It did so despite a COVID-19 pandemic that disrupted tourism and mandated exceptional increases in public spending. Yet, despite this exogenously prompted deviation from plan, the IMF’s baseline projection, in its 2023 Article IV report, forecasts a further fall in debt-GDP to less than 60 per cent over the next four years,” the paper said further.
The paper highlighted the fact that the Fiscal Responsibility Framework, introduced in 2010, required the Minister of Finance to take measures to reduce, by the end of fiscal year 2016, the fiscal balance to nil, the debt-GDP ratio to 100 per cent, and public-sector wages as a share of GDP to nine per cent.
“The framework was augmented in 2014 to require the Minister, by the end of fiscal year 2018, to specify a multi-year fiscal trajectory to bring the debt-GDP ratio down to 60 per cent by 2026. The framework included an escape clause to be invoked in the event of large shocks.
“This prevented the rule from being so rigid, in a volatile macroeconomic environment, as to lack credibility. At the same time, it included clear criteria and independent oversight to prevent opportunistic use,” the paper said.
The paper further pointed to the consensus building exercise entered into by the Government, which was key to the achievement.
“In 2013, a series of ongoing discussions in the National Partnership Council, a social dialogue collaboration involving the Government, parliamentary Opposition, and social partners, culminated in the Partnership for Jamaica Agreement on consensus policies in four areas, first of which was fiscal reform and consolidation,” the paper noted.
“The Partnership for Jamaica Agreement fostered a common belief that the burden of fiscal adjustment would be widely and fairly shared. It supported the creation and ensured broad national acceptance of the Economic Programme Oversight Committee (EPOC) to monitor and publicly report on fiscal policies and outcomes, and to provide independent verification that all parties kept to the terms of their agreement,” the research said.
“By creating a sense of fair burden sharing, Jamaica’s organised process of consultation thus sustained public support for the operation of the country’s fiscal rules, culminating in March 2023 with the establishment of a permanent, independent Fiscal Commission,” the economists declared.
“Jamaica managed its financial system well in this period. It adeptly managed the term structure of the debt, by way of a well-designed fiscal rule, and a partnership agreement creating confidence that the burden of adjustment would be widely and fairly shared.
The fiscal responsibility and the partnership agreement were key, as neither element would have worked to achieve sustained debt reduction in the absence of the other.
Both were needed the authors declared.
It might not seem like roughly a quarter-century since the digital smartphone made an irrevocable impact on all our lives (whether you currently have one or not), but over the course of those years, cell phones have moved from being glorified field radios to nearly everyone’s go-to device; in business and in personal life, the smartphone is THE accessory, replacing analog watch, camera, game console, phone book and day-runner (remember those?).
And the function consolidation shows no signs of abating, as new feature-rich phones continue to be released to an ever-hungry public.
Dane Spencer, of Smart Mobile Solutions
No surprise then, that a gaggle of entrepreneurs, execs, media and influencers thronged the Digicel store in Tropical Plaza for Samsung’s latest salvo in the smartphone market “arms race” – the S25 line, comprising the base model, S25+ and the topline S25 Ultra, all boasting advanced artificial intelligence (AI) capabilities in addition to the expected bells and whistles (3 different types of camera; powerful new chipset; vital body function monitor etc). Emcee Debbie Bissoon kept things moving with her usual aplomb.
Dane Spencer, of Smart Mobile Solutions, in Jamaica, spoke to this ongoing function consolidation as a key driver of sales and market share. “The convergence of multiple apps on a single handy device means I can truly access and respond to information from anywhere,” he said, providing a personal demonstration on his own S25. “That means whether you’re in corporate or in business for yourself, you can make better decisions, faster.”
Jaszmin Martinez, the Dominican Republic-based Corporate Marketing Manager for Samsung amplified Spencer’s points on market share, adding, “Samsung has a significant presence in the Jamaican market, and one which has grown year on year, so it’s a very important market for us,” she said. According to Stat Counter, Samsung enjoys roughly 52% of the Jamaican smartphone market.
Stephen Murad of Digicel reminisced briefly about the head-spinning growth the company experienced in its early days and all the momentous changes that had taken place in the cell phone market since its launch in 2001. The cell phone, he said, was no longer just a device that you talked through, but increasingly, one you talked with (referring to the AI capabilities) and a constant companion. “The markets’ need for data is never-ending” he said, as folks of all ages have been spending more and more time with their phones.
The company has, however, taken note of those factors and the associated dangers of this manner of closeness with our devices, and has recently launched, though the Digicel Foundation, the Safer Internet Together (SIT) project. In partnership with other corporate entities (JPS Macmillan Education and Sunshine Snacks) and public agencies, the mobile carrier intends to advocate for safer, more responsible internet usage among students in 150 educational institutions.
But, as evidenced even from the interest in the store on launch night, a considerable number of Jamaicans plan to spend lots of time with their S25s.
The new device arrives almost, on cue, in a very dynamic and recently volatile, global smartphone market. After nearly three years of decline, the smartphone market had posted a creditable 7%, according to figures from Canalys Research. The hammer looked set to hit this year with the US President’s all-out trade war, and with the trade conflicts with China ongoing, smartphone sales may buckle under inflationary pressures.
Indeed, the stated Jamaican list price for the S25 entry model (J$136K + tax) is an eminently competitive tag, no doubt influenced by an awareness of the general market conditions (while not cheap, its entirely in line with what one would expect to pay for a similarly equipped competitor model). Indeed, the two lucky guests at the launch who each won one of the S25s on offer are no doubt putting their devices through their respective paces.
The ongoing evolution of life, both in the business and personal spheres, demand devices that can keep pace with dynamics of our multi-active, instantly communicating world, and at a competitive price point. Samsung, with its new flagship series, is looking to deliver -and reap handsomely – on all of those expectations.
Michael A. D. Edwards
Businessuite News24
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Photo: Prime Minister, Dr. the Most Hon. Andrew Holness right) speaks with designer, Vintage Chic, Shanna Campbell about her handmade pieces, during the opening ceremony for Expo Jamaica 2025 at the National Indoor Sports Centre in St. Andrew on April 3.
Photo: Prime Minister, Dr. the Most Hon. Andrew Holness left), samples a coffee carrot ginger brew from Beyond 5 Beverages given to him Managing Director of the company, Damain Drummond right) during the opening ceremony for Expo Jamaica 2025, at the National Indoor Sports Centre in St. Andrew on April 3.
Prime Minister, Dr. the Most Hon. Andrew Holness has committed to ensuring that the policies and initiatives of the Government remain aligned with entrepreneurs, thereby creating an enabling environment that fosters investment. “To our manufacturers and exporters… your effort represents the heart of our economic progress, your resilience, innovation, and entrepreneurial courage has carried Brand Jamaica to every corner of the globe.
“As Prime Minister, I commit to ensuring our policies and initiatives remain aligned with your ambitions, creating an enabling environment that fosters investment, innovation and global competitiveness. Together we will strengthen our local economy and solidify Jamaica’s position on the international stage,” Dr. Holness said.
The Prime Minister was speaking during the opening ceremony for Expo Jamaica 2025 at the National Indoor Sports Centre in St. Andrew on April 3.
Dr. Holness said Expo Jamaica is a vivid showcase of Jamaica’s boundless potential, “so as we advance global partnerships and create impactful local results, let us reaffirm our collective determination to build a prosperous, productive Jamaica that leaves no one behind”.
“Expo Jamaica exemplifies how far Jamaica has come. Over 250 exhibitors showcasing more than 5000 products and services alongside 884 registered local and international buyers from 25 countries. This clearly reflects Jamaica’s growing global influence and appeal,” he said.
He added that the event has grown tremendously, now standing as the largest trade exhibition in the English-speaking Caribbean.
Meanwhile, Dr. Holness said Jamaica today boasts its strongest economy since independence.
“Whether you measure Jamaica’s economic performance and stability by the unemployment rate, the inflation rate, the debt-to-GDP (gross domestic product) ratio or Net International Reserves (NIR), by every critical metric, our economy undeniable demonstrates economic stability and resilience,” he said.
He added that growth is another central pillar to economic stability and resilience.
“For Jamaica to realise its fullest potential, our growth rate must accelerate from one to two percent towards a more ambitious target of four to five per cent. Central to achieving this are initiatives which this Government has launched, and we call them ASPIRE, that is our comprehensive growth strategy,” he said.
ASPIRE stands for: Access to Economic Opportunity for All (Inclusive Growth); Safety and Security; People (Human Capital Development); Infrastructure Development; Reform of the Bureaucracy (Ease, Speed, and Cost of Doing Business); Economic Diversification/New Industries.
He further added that inclusivity and equity are paramount to the Government’s growth agenda.
Meanwhile, Minister of Industry, Investment and Commerce, Senator the Hon. Aubyn Hill said the administration continues to position Jamaica as an investment destination for financial services, logistics, skilled labour, high value services and premium products.
“This expo is Jamaica’s open invitation to the world… The Andrew Holness administration has made it our mission to make Jamaica a very attractive place in this region in which to do business. Our macroeconomic numbers tell a clear story,” he said
Other speakers at the function included President, Jamaica Promotions Corporation (JAMPRO), Shullette Cox, and Chairman, Expo Jamaica, Aswad Morgan.
This year’s event is being held from Thursday (April 3) to Sunday (April 6) at the National Arena and the National Indoor Sports Centre in Kingston.
The four-day tradeshow, under the theme ‘Global Partnership, Local Impact: Advancing Jamaica’s Reach’, is organised by the Jamaica Manufacturers and Exporters Association Limited (JMEA) and JAMPRO.
By: CHRIS PATTERSON, JIS
Businessuite News24
Government Engages with US Trade Representative on New Tariff Regime
“There are opportunities that must be had. There are prospects to be uncovered, and so I urge my manufacturers, my businesspeople, before you start to look at the negative, also look for the opportunities. Don’t just sit down and complain about all the things that’s going on and all the things that’s going bad, expecting that Government is going to solve all the problems for you. Be the entrepreneur; be the one who is the risk-taker, and be the one who is looking for the opportunity,” Dr. Holness said.
Prime Minister, Dr. the Most Hon. Andrew Holness, says the Government is actively engaging with the United States (US) Trade Representative and other relevant authorities “to seek urgent clarification” on the new US tariff regime.
Speaking at the opening of EXPO Jamaica 2025 at the National Indoor Sports Centre in Kingston, on April 3, he said the United States Government recently announced a 10 per cent baseline tariff on imports from all countries, set to take effect on April 5, 2025, which introduces a significant shift in global trade policy, “one that could impact Jamaica’s market access to our largest trading partner”.
Dr. Holness informed that Jamaica, like other CARICOM nations, has traded with the US under the Caribbean Basin Initiative (CBI), which provides non-reciprocal duty-free access for a wide range of products to the US market.
“Today, nearly 90 per cent of Jamaican exports to the United States enter under these preferential terms; however, the new US tariff regime, rooted in a broader policy of reciprocal trade balancing, has raised serious concerns about the future of these preferential arrangements,” he said.
The Prime Minister noted that the Government has not yet received formal notification on the precise implementation procedures, including whether these new tariffs will override existing CBI provisions.
“We are also conducting a detailed technical assessment, in collaboration with relevant ministries and agencies, to fully understand the scope of these tariffs and their implications for Jamaica’s trade and industrial policy,” he said.
He pointed out that the developments do not reflect any erosion in the long-standing and strong bilateral relationship between Jamaica and the United States; rather, it reflects a broader recalibration of US trade policy that is global in scope.
“Still, we will use every available diplomatic channel, including working with our CARICOM brothers and sisters and utilising the Office of Trade Negotiations, to seek to preserve the position our exporters have secured over decades of deepening trade ties with the United States,” Dr. Holness said.
He noted that preliminary analysis indicates that some of the country’s top exports may fall under exempted product categories “and we are working to confirm and where possible, to expand these exemptions”.
“Again, I must emphasise that clarity is still needed on several matters. Furthermore, there may also be opportunities to be found and we must, therefore, be proactive and prospective,” the Prime Minister said.
He added that the Government will continue to advocate for manufacturers and exporters to ensure their interests are protected in any new global trade architecture.
“So, to our manufacturers and exporters, we understand the uncertainty this announcement has created and we are with you every step of the way. You are not only integral to our economic strategy, you are national champions of our resilience and ingenuity,” Dr. Holness said.
Meanwhile, he said the Administration will continue working to ensure the country secures its economic independence, even as it remains alert and responsive to evolving global trade dynamics that affect manufacturers and exporters.
“Yes, it is uncertain times, but we have done the necessary work. We have built the relationships; we have placed ourselves in strategic positions to be heard and to be heard from and to be consulted. When these changes are going to happen, we know that they could have long-term impact; we started planning long ago,” the Prime Minister said.
“You have a Government that is thinking very carefully, very strategically. I play chess, not draughts… . Maybe a decade ago, the word disruptive would have been an inherently bad thing. In today’s world, you require disruption of systems for there to be innovation and new opportunities. So, whilst we see the downside of the disruptive global order that we have now, we are not going to sit by and wait,” he added.
The Prime Minister urged manufacturers and exporters to explore new opportunities, noting that the Government will work with them.
“There are opportunities that must be had. There are prospects to be uncovered, and so I urge my manufacturers, my businesspeople, before you start to look at the negative, also look for the opportunities. Don’t just sit down and complain about all the things that’s going on and all the things that’s going bad, expecting that Government is going to solve all the problems for you. Be the entrepreneur; be the one who is the risk-taker, and be the one who is looking for the opportunity,” Dr. Holness said.
By: Chris Patterson, JIS
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