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.
Businessuite News24
JA$2 Billion in Support to Jamaican MSMES
“Small business owners have said to me that opening a bank account for their business is difficult. They feel there’s no difference between the requirements for them as MSMEs, as opposed to a very large institution,” she noted.
The Development Bank of Jamaica (DBJ) has been allocated $2 billion in the 2025/26 Estimates of Expenditure to support funding to the micro, small and medium-sized enterprise (MSME) sector.
Minister of Finance and the Public Service, Hon. Fayval Williams, made the disclosure while delivering the opening presentation in the 2025/26 Budget Debate in the House of Representatives on Tuesday (March 11).
“It (the DBJ) will continue to pursue innovative means of mobilising funding and leveraging private-sector investment and expertise through its venture capital programme, as well as public-private partnerships and privatisation transactions,” she informed.
Mrs. Williams noted the Government’s commitment to the MSME sector, which includes an estimated 422,000 registered small businesses, generating 80 per cent of the jobs in the economy.
Approximately 1,136,240 persons are employed by MSMEs.
The Minister acknowledged that there are several issues facing the sector, including lack of equitable access to financing, high interest rates and cumbersome requirements for opening bank accounts.
“Small business owners have said to me that opening a bank account for their business is difficult. They feel there’s no difference between the requirements for them as MSMEs, as opposed to a very large institution,” she noted.
She pledged to work with Minister of Industry, Investment and Commerce, Senator the Hon. Aubyn Hill, to reduce the requirements for the entities to open bank accounts.
The Finance Minister noted, further, that Government will be increasing the General Consumption Tax (GCT) exemption for small businesses from $10 million to $15 million.
By: Donique Weston JIS
Businessuite News24
Jamaica Open For High-Value Agricultural Investments – Minister Green
“Now is the time for high-value agricultural investment, right here in Jamaica. Things that we produce in Jamaica are sought after all over the world. As such, we do believe there are significant opportunities now in agro processing,” Mr. Green said.
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Businessuite Women
Corporate Movements: Margaret Campbell Appointed CEO of GKMS Group; Lee-Anne Bruce Named COO
GraceKennedy Limited (GK) is pleased to announce leadership changes at GraceKennedy Money Services (GKMS) as part of its ongoing succession plan and strategic talent development and deployment.
Effective April 1, 2025, Margaret Campbell will assume the role of Chief Executive Officer (CEO) of the GKMS Group. Campbell, who has worked with GKMS for over 25 years, has served as its Chief Operating Officer (COO) since 2020. She joined GKMS in 1996 and has held several leadership roles during her tenure including, Financial Controller, Chief Financial Officer (CFO), and Country Manager for GKMS Jamaica. A Fellow Certified Chartered Accountant, Campbell also holds an MBA in Finance from the University of Manchester and serves on several GK subsidiary boards. She is also the current President of the Jamaica Money Remitters Association.
Frank James, Group CEO of GraceKennedy, expressed confidence in Campbell’s leadership, stating, “Margaret has demonstrated strong leadership and an unwavering commitment to providing exceptional value and convenience to our customers across Jamaica and the wider Caribbean, in keeping with our vision of being the number one Caribbean brand in the world. I have no doubt she will continue to drive GKMS forward.”
Grace Burnett, CEO of GKFG, added, “Margaret’s industry expertise and strategic approach make her the ideal person to lead GKMS into the future. Her experience and passion for operational excellence will be instrumental as GKFG continues to grow and evolve.” The announcement of Campbell’s appointment comes as Burnett, who has led GKMS since 2019, prepares to retire from GraceKennedy later this year.
Lee-Anne Bruce
Additionally, GraceKennedy has named Lee-Anne Bruce as the new COO of the GKMS Group, also effective April 1, 2025. Bruce holds a bachelor’s degree from the Frank G. Zarb School of Business at Hofstra University and is a Certified Anti-Money Laundering Specialist. With over a decade in senior leadership roles at GK, she has served as Group Chief Compliance Officer, Chief Risk Officer, and most recently, Chief Audit Executive. She began her career at GK in 2003, when she played a key role in GKMS’ expansion into the Eastern Caribbean.
Margaret Campbell, incoming GKMS CEO, welcomed Bruce’s appointment, stating, “Lee-Anne is no stranger to GKMS and her extensive experience and understanding of our business will undoubtedly be invaluable in her new role.”
In light of the leadership changes at GKMS, Judith Chung, Group Chief Compliance Officer & Senior Legal Counsel, will act as Chief Audit Executive of GraceKennedy Limited, while Jason Bailey, Head of Risk, will temporarily assume responsibility for the Compliance portfolio.
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