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If We Are To Have Real Growth And Development Nationally …. We Must Grow Our SME Sector.

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ladies and gentlemen, I have noted that the title of opening plenary is: Entrepreneurship, Innovation And Growth: Unlocking The Potential In The Jamaican Economy. Implicit in this I suppose is the message that entrepreneurship and innovation have something to do with growth?
Is that an assumption that one could fairly draw?

Well I suppose that that is what we are currently hearing…we are told by the economic growth council to unleash our entrepreneurial spirit….we are told by the world bank to become more innovative….we are told by various members of the political directorate to take more risks and invest in new areas….so….it would appear that everybody is seeing the link between entrepreneurship and growth.

The private sector organization of Jamaica and the Jamaica banker’s association are finally reaching out to small and medium size entrepreneurs to get them to formalize their operations….all good…all commendable…but will it work? is it some form of magic bullet? or is it the beginning of a new paradigm that must be adopted by the entire society in order for us to secure our mature development as a society?

Let’s take a good look at where we are…lets set the historical context for the progress that we are trying to achieve….but first. let me take a moment to talk about the establishment of the access to finance facilitation panel that has been set up under the auspices of the PSOJ by the Jamaica bankers association with tremendous support from JMMB.

It is important to note that the current definition of the SME sector is business entities having between 1 and 50 employees and an annual turnover of less than one hundred and fifty million dollars….

The aim is to bring greater awareness of the SME sector to the governments access to finance reform agenda and to provide input and support for the adoption and expansion of the access to finance program across various stakeholder sectors through a process of education, facilitation and coordination…

The project has two streams. Access to finance…. and a reverse factoring program which is being developed in conjunction with DBJ …. receivables are a real big issue with SME’s….cash flow continuity is critical to the life of a small business…
We hope to foster better relationships between the banks and small businesses.

Simplify the credit processes to make them easier and more transparent for MSME’s …

We want to train the MSME’s in formalizing, regularizing and structuring their business processes and unlock additional capital to allow for business expansion…

The program has been rolled out and will continue with a series of workshops to facilitate all of the above and to create a user friendly and harmonious relationships among the stakeholders…

I am asking our business sector to suspend its cynical disbelief and support this program fully as it can be a valuable tool to reduce the marginalization and inequality in our economy …

Back now to our historical context.

I submit to you that every successful and progressive society stands on three pillars …three foundation stones…the state….the community and ..the market…the market being the private sector ( commerce)…

If those pillars or foundation stones are not properly balanced and proportional to each other the progress of the society will be threatened.

For a society to be successful…the state must be strong, effective, facilitative and corruption must be controlled…the community must be educated and skilled, united in common goals and the degree of marginalization and inequality must not be so great as to be an insurmountable barrier to the success of the average citizen with ambition and drive…

The market (the private sector) must be innovative…agile…well capitalized and technically competent and well regulated…

If these elements are not present…there is a great potential for social disorder…individualistic and selfish behavior, corruption and antisocial activity…

For almost all of the six decades since Jamaica’s independence, the pillars …the elements referred to above have been unbalanced…

We started out in 1962 with a fairly strong private sector…but one that was substantially foreign owned…
a state that was inadequate in its preparation …..and unsure of its purpose….and a community that was exceedingly marginalized and full of inequality…..and yes we had growth.

But i submit that we made the mistake then..that if we are not careful we will make now..we had growth that was not inclusive…and since then by various experiments and adventures we have built the state into a towering giant that attempted to control the commanding heights of the economy and is the largest employer of low wage workers….

As a consequence of our excursions into uncharted and strange waters, we squandered resources on various experiments and adventures…and we wasted our patrimony on badly executed attempts thereafter by the state to borrow money and spend its way out of a stagnating economy as well as a badly executed effort to liberalize the financial sector…
The state became an inefficient and corrupt behemoth …and the private sector became a co- conspirator in the corruption …dependent on the state for its existence and ignoring true entrepreneurial capitalist endeavors in favor of lending money to the state and living off licenses and special privileges…..all this while the community grew increasingly marginalized…and individualistic in its indisciplined and divisive behaviors….

There is no question in my mind that the near catastrophic failure of our economy up to the last decade is a consequence of the imbalance described briefly above, and it would be worth our while to effect a study of our economic history to elicit detailed lessons so as to prevent a repetition in the future….

It has been due to the disciplined and enlightened work of strong leaders from both our public and private sectors and the enormous sacrifice and pain of our ordinary citizens that we have drawn back a little bit from the edge of the precipice …..

And ladies and gentlemen…any medium size external or internal shock can easily draw us back into the abyss…..any major international crisis involving the north American market ….or volatile oil prices…any serious natural disaster …
or …our failure to control corruption and crime and violence in short order…. can take us right back to square one…..and worse…

So …today this is where we are in economic terms….

Inflation at the rate of 3.9% at the end of April GDP growth of 2% for final quarter of last year with a projection of 1.5% for first quarter 2019 ….PIOJ estimate of 1.9% for financial year 2019 interest rates at all-time lows….country running fiscal surpluses and cash reserves ratio reduced twice in last six months….country is awash in liquidity …. investment is increasing …real estate is booming …. banks are buying insurance companies…insurance companies are buying banks…employment is increasing…

So what’s the problem?

Well…folks…the problem is that we are still suffering from the same difficulty of inequality and marginalization….good things are happening…but they are only happening for a minority of our people in the business sector….and that’s not development is it?

It may be growth …but it’s not sustainable development…. this has happened before…we had growth in the nineteen sixties, but it excluded most of our people and created fertile conditions for the development of social disorder…growth must be inclusive…the door to development must be opened wider…

In Jamaica today we have a highly informal sector comprising some 43% of Jamaica’s GDP in 2006…probably more now if you look at the money flows that the banks are reporting …

Our SME’s employ 70% -80% of our workforce….they represent 97% of all tax paying entities and are a significant contributor to our GDP….

But….only they get 11% of private sector credit and only access 26% of bank loans….so the majority of our SME’s are outside of the economic blanket…. illegitimate children of our unbalanced society and our marginalized economy…

We don’t have time today to go into the cultural history of our economy and the reasons why the SME’s have been left out …but what we can speak to is that the consequences of that neglect include corruption and indiscipline…crime and a lack of national commitment…

Worst of all …. ladies and gentlemen…SME’s are the fertile incubators…the spawning grounds for innovation and entrepreneurship…so if they are stifled we are stifling our future…

Ok…so if you are following my logic so far ….and if you are still awake. Then you will agree that if we are to have real growth and development nationally …. we must grow our SME sector…and the ingredients for growth exist.

The fact is that since 2016 there have been over one hundred interventions to assist MSME growth and development …. ranging from access to finance measures taken by the DBJ through institutional strengthening efforts …access to markets assistance …. capacity building and the reduction of informality of their processes…. however, ……these measures have not been taken up by the MSME because of various reasons including but not limited to……… Lack of awareness. Uncertainty and fear…and inability to conform…

So…our task is to push the access door for them and it must be done.

The sustainability of our growth depends on it …. the mature development of our country depends on increasing equality and reducing the wide variances of wealth.

The only feasible way to break out of the low wage trap is to empower our entrepreneurs and innovators to monetize their ideas and access capital.

Foreign investment is welcome but it’s just that …. foreign investment brings capital but its value added is destined for elsewhere….

We at the PSOJ believe that it is our task to reach out to our new businesses and to nourish them to viability…the state cannot do it by itself.

It can create the right facilitative environment and we must push for that…but the state doesn’t understand capitalism and profit…the private sector does ….and we must take up the challenge and build our own future from the tremendous birth right of creativity and energy with which have been blessed.

Fundamental to this effort is the need to map and unleash the assets that are trapped in our inner cities and our market districts.

Much of our global renown for creative culture and our sporting accomplishments come from the inner cities…and yet we continue to ignore these talents and force them to take their skills to the entertainment capitals of the world.

We have trapped our best and brightest in the prisons of depressed areas and keep them there with states of emergency and politics…

If we spent one third of the money recently spent on infrastructure …if we had spent it instead on our human capital and improvement of the depressed areas. The return on capital. The reduction of crime and violence.

The modification of the deviate behaviours would be the growth rocket that we keep wishing for…ladies and gentlemen .it is people that create growth. Not machines…not money. It is time that we understand that successful capitalism puts people first …. that growth and development must strive for inclusiveness or else our efforts will contain the seeds of failure…

The time for new thinking is now…and the time to act differently is here…let us open our minds to the possibilities of our own people and give our entrepreneurs the fuel to make our growth sustainable…
thank you for listening.

Speech Given By Howard Mitchell, President The Private Sector Organisation of Jamaica To The 4th Business And Management Conference – Mona School Of Business And Management.
Jamaica Pegasus June 10th, 2019

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Entrepreneurship

Building a Business While Working a 9–5: The Real Hustle Behind the Dream

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Starting a new business is bold. Starting one while managing a full-time 9–5? That’s a different kind of brave.

For many aspiring entrepreneurs, the safety net of a full-time job provides stability while pursuing a passion project or startup dream. But make no mistake — it takes strategy, discipline, and an honest understanding of your limits.

Here’s what I’ve learned (and am still learning) as I straddle both worlds:

1. Time Becomes Your Most Valuable Currency
With only early mornings, lunch breaks, and late nights to spare, you begin to spend time like money. You’ll learn quickly that not every meeting is worth it, not every opportunity is aligned, and not every “yes” deserves your energy.

2. Boundaries Are Everything
Your job deserves your full attention during business hours. Your startup deserves its own sacred space. Without clear boundaries, burnout is inevitable and performance can suffer — in both areas.

3. You Don’t Have to Do It Alone
Whether it’s a co-founder, a freelance designer, or a virtual assistant, small investments in support can pay off big in time and sanity. And yes, your network is a secret weapon.

4. Progress Over Perfection
You won’t launch with the perfect website, the flawless pitch deck, or a viral brand — and that’s okay. The most important step is the next one. Small, consistent progress compounds.

5. Clarity Comes Through Action
You might start your business thinking it will go one way, only to find your true niche or product-market fit halfway down the road. That clarity won’t come from overthinking — it comes from doing.

Starting a business while working a full-time job isn’t about being superhuman — it’s about being deeply committed to a bigger vision while managing your current responsibilities with integrity.

To those in the thick of the hustle — keep going. You’re not alone, and you’re not crazy. You’re building something meaningful.
If you’re in this season too, I’d love to hear your story. What’s your business? What’s working? What’s not?

Let’s connect and support each other.

Rojah Thomas Co-Founder at Kree8 Hive!
Sales & marketing maven, passionate marketer with a love for sales. With over 8 years experience in the field, I offer a refreshing new age approach to marketing with a direct focus on sales and ROI.

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Business Insights

You Can’t Fix What You Can’t See: Why Jamaica Broilers’ U.S. Collapse Wasn’t Just Financial, It Was Strategic

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A supply chain leader’s take on how weak governance, poor integration, and reactive leadership cost Jamaica Broilers billions, and what Caribbean firms must do differently.

As a Jamaican-born supply chain executive working in the United States, I’ve seen firsthand how ambition without execution can quickly become a liability. That’s exactly what happened to Jamaica Broilers Group Limited. For nearly 70 years, JBG has been a symbol of Caribbean manufacturing excellence. However, in early 2025, the company announced its first quarterly loss in history, primarily driven by a $1.15 billion loss from its U.S. operations.

Recent news articles suggest that miscalculations in valuing inventory and biological assets contributed to financial losses. As a leader in operations, financial transformation, and supply chain audits, I can state:

This was not just a financial mistake. It was a strategic failure of systems, governance, and business leadership.

The Numbers Tell the Story

Based on regulatory filings and media reports from Our Today and the Jamaica Observer, here’s what went wrong:

  • JBG admitted to using “unsubstantiated accounting valuation methodologies” affecting inventories and biological assets
  • The company expects a material restatement of U.S. earnings
  • It recorded a J$1.15 billion quarterly loss, compared to a J$1.3 billion profit the year before
  • U.S. operating profit fell from J$2.98 billion to J$922 million over nine months
  • The entire U.S. leadership team was removed, including Stephen Levy, the CEO’s brother
  • External financial advisors were brought in, and reports were delayed twice before being released

This wasn’t an isolated oversight. It was a total breakdown in the systems that connect supply chain performance to financial truth.

Where the Strategy Failed

1. Operations and Finance Were Completely Disconnected

JBG’s misstatement of inventory and biological assets tells me one thing: Finance was not operating with real-time data from the supply chain. In an asset-heavy industry like poultry, valuation accuracy is directly tied to production yields, biological input tracking, and inventory turnover. If those systems are disconnected, your balance sheet is based on assumptions.

Insight: You can’t fix what you can’t see. Real-time inventory visibility is no longer optional, especially in a low-margin industry.

2. Governance Was Passive, Not Proactive

The issues in the U.S. operation were only uncovered during a quarterly review. This means that for months, the leadership based in Jamaica had no visibility into what was truly occurring. There were no warning signs, no escalation triggers, and no governance frameworks in place to identify these missteps earlier.

Insight: Foreign subsidiaries must be governed as extensions of the enterprise, not as independent silos. Operational governance is not a meeting, it is a system.

3. No Strategic Positioning in the U.S. Market

JBG tried to enter the U.S. poultry market as a mainstream player. No diaspora segmentation. No culturally driven SKUs. No unique value proposition. That meant they were competing directly with industry giants like Tyson Foods and Sanderson Farms, with no brand edge or pricing power.

Insight: In the U.S., don’t compete on commodity. Compete on culture, value, and customer alignment. JBG ignored the Caribbean diaspora, and with it, a major advantage.

4. Overexpansion Without Standardization

JBG operated two facilities in the United States, located in Iowa and South Carolina, without a unified operational model. The systems were not standardized, and the processes were not synchronized. The resulting consequences were significant.

  • Ballooning operating expenses
  • Fragmented performance metrics
  • Reduced supply chain efficiency

Insight: Expansion is not growth unless it is built on a repeatable model. Two facilities without one process is not scale, it is confusion.

What They Still Haven’t Fixed

Despite public admissions and leadership changes, JBG has not yet addressed:

  • Whether it will consolidate operations under a single facility
  • How will it implement diaspora-driven branding and product segmentation
  • What new controls are being put in place for real-time operational audits
  • How will its ERP or financial reporting systems be upgraded

The response remains focused on personnel. But this was never just a people problem. It was a process problem.

My Recommendations for Caribbean Firms Entering the U.S.

As someone who has optimized supply chains, here is what I recommend:

1. Integrate ERP Systems Across All Operational Units

Ensure that inventory data, production yields, and cost accounting are aligned and communicate effectively with one another daily.

2. Establish Governance With Clear Escalation Protocols

Don’t wait for quarterly reports. Build monthly audits, early-warning triggers, and local compliance reviews into your operations.

3. Build With Culture at the Center

Diaspora markets are not just nostalgic, they are loyal. Own that connection with specialized SKUs and targeted marketing.

4. Standardize Before You Scale

Replicate only what works. Make sure your first location operates with precision before opening a second.

5. Tell the Truth Sooner

Market trust is built on clarity. Communicate failures transparently, and show the systems being built to prevent recurrence.

I’m not writing this to criticize JBG. I share this because I’ve witnessed this narrative repeatedly. This was a billion-dollar lesson, highlighting the need for Caribbean businesses to prioritize operational discipline over mere optimism when expanding into the U.S.

Financial breakdowns start as operational blind spots. Visibility isn’t a luxury—it’s the foundation of trust.

Jermaine Robinson, MBA, CSCP
Strategic Supply Chain Leader | Global Logistics & Distribution Leader | Driving Operational Excellence & Digital Transformation

The views and opinions expressed are those of the author/s and do not necessarily reflect the official policy or position of companies or clients for whom the author/s are currently working or have worked. Any content provided by the author/s is of their opinion and is not intended to malign any religion, ethnic group, club, organization, company, individual, or anyone or anything.

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Leadership Conversations

Why Some CEOs Resist the Concept of Buy-In

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In my years of working with CEOs during strategic planning, I’ve noticed a surprising resistance among some leaders to the concept of buy-in. To these CEOs, seeking input or engagement from employees feels like a sign of weakness. They believe leadership should be about mandating change and that buy-in dilutes their authority. This resistance, while common, often undermines the very success they aim to achieve through strategic planning.

The CEO’s Perspective on Buy-In
For many CEOs, strategic planning aims to create change—often significant, organization-wide change. They understand that change is difficult and frequently met with resistance, particularly from employees accustomed to the status quo. However, their response is often to mandate change, dismissing the need for employee involvement.

This approach stems from the belief that engaging employees in the planning process equates to surrendering control or being held hostage by their resistance. Confident in their vision, these CEOs view buy-in as an unnecessary hurdle, preferring to impose decisions with a “comply or leave” mentality.

The Case for Buy-In
My counterargument is simple yet profound: decisions are only effective if they are supported by those who must implement them. Dr. Robert Zawacki of the University of Colorado articulates this well in his book Transforming the Mature Information Technology Organisation. He argues:

Effective Decisions = The Right Decision X Commitment to the Decision (ED = RD x CD).

This formula highlights that even the best decisions will fail without the commitment of those responsible for implementing them. Commitment doesn’t arise from compulsion—it comes from understanding and shared ownership.

The Power of Participation
Engaging employees in the planning process fosters a deeper understanding and greater alignment. When employees are involved in crafting the parts of the plan that impact their work, they are more likely to accept and embrace the required changes. It aligns with the adage:

“If they create it, they understand it. If they understand it, they commit to it.”

Participation doesn’t mean ceding control; it means building a coalition of committed individuals who will champion the plan’s execution. Buy-in transforms resistance into ownership, turning a potential liability into an asset.

The Bottom Line
CEOs who dismiss buy-in as a weakness fail to see it as a tool of strategic strength. Leadership is not just about creating the right plan—it’s about ensuring that the plan succeeds. Engaging employees is not a concession; it’s a strategy for building commitment, aligning efforts, and achieving lasting change.

Buy-in isn’t just a nice-to-have; it’s the multiplier that turns the right decisions into practical actions.

 

 

 

 

 

 

Ronnie Sutherland
Managing Partner – Strategic Solutions Limited.I am a strategic planning facilitator ready to guide you through your next strategic planning process.”

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Businessuite News24

Finance Minister Highlights Middle Managers’ Key Role in Jamaica’s Economic Growth

“As Minister, I see every day how important strong leadership is to sustaining the progress we’ve made in stabilising our economy, attracting investment and opening new opportunities for our people,” Mrs. Williams said.

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Minister of Finance and the Public Service, Hon. Fayval Williams, has underscored the pivotal role middle managers play in driving Jamaica’s economic progress.

“As Minister, I see every day how important strong leadership is to sustaining the progress we’ve made in stabilising our economy, attracting investment and opening new opportunities for our people,” Mrs. Williams said.

She declared that middle managers are “the energy that gets things done” as they move their companies along, exhibiting true leadership that shapes the transformation of teams and influences the drive towards national development.

“[True leadership] is the consistent demonstration of values, authenticity and strategic focus that leaves behind a real legacy… one not written in résumés but in lives changed, organisations built, and futures secured. I know that you know that titles may grant authority, but only influence grounded in service, discipline and integrity builds the trust that moves countries like Jamaica ahead,” Mrs. Williams said.

Minister of Finance and the Public Service, Hon. Fayval Williams (second left), converses with (from left) Director, Montego Bay Chamber of Commerce and Industry, Donovan Chen-See; Managing Director, Make Your Mark Consultants (MYMC), Dr. Jacqueline Coke-Lloyd; and Bishop Dwight Fletcher, during the MYMC two-day Middle Managers’ Leadership Conference at The Jamaica Pegasus hotel on Tuesday (April 29). Mrs. Williams delivered opening remarks.

She was addressing stakeholders on day one of the Make Your Mark Consultants (MYMC) two-day Middle Managers’ Leadership Conference at The Jamaica Pegasus hotel in New Kingston on Tuesday (April 29).

Mrs. Williams noted that strategic and decisive leadership is especially critical in navigating current global uncertainties.

“In today’s increasingly dynamic global trade environment, Jamaica’s agility or ability to move swiftly, decisively and strategically is essential for national success; and at the execution level, it is you, it is our middle managers who drive that success.

You’re the ones ensuring that vision becomes reality, solving problems, coaching teams, delivering results and adapting to change with confidence and clarity,” she contended.

The Minister further pointed out, “In a Jamaica that is growing steadily stronger with sound leadership, prudent economic management, historic low unemployment rates, a transparent inflation-targeting regime, real investments in education, infrastructure, and innovation, it is clear that, as a country, we are on the right path.”

Meanwhile, Mrs. Williams lauded MYMC for organising what she described as the premier management conference in Jamaica, noting that the event is critical as Jamaica navigates an increasingly complex global economy.

She noted that this year’s conference theme – ‘A Legacy of Change, Transformation and Execution’ – is apt for the occasion.

“It reminds us that leadership is not about titles, offices, or positions. It’s about action [and] the courage to move when others hesitate. It’s about vision… the ability to see beyond today’s challenges and into tomorrow’s possibilities. Most importantly, it’s about influence – the ability to inspire people to believe in a cause greater than themselves, to push past limits to build institutions that will stand the test of time,” the Minister emphasised.

Mrs. Williams encouraged the participating middle managers to take advantage of the conference by actively engaging in the discussions, learning from the experts, sharpening their skills and strengthening their networks so they can be better and stronger leaders, driving Jamaica’s continued growth and transformation.

By: Donique Weston, JIS

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Leadership Conversations

Reinvigorating Global Growth through Productivity Reforms – Nigel Clarke

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Distinguished guests, ladies and gentlemen, good morning. I want to thank the China Development Forum for inviting me to speak today. It’s an honor to be here, especially as this marks my first visit to China since joining the IMF.

This is the Year of the Snake—a year of renewal and transformation. A fitting symbol, given the pace of change around us.

Patterns of trade and capital flows are shifting. AI is rapidly advancing. Trade is no longer the engine of global growth it used to be. Divergences across countries are widening. And governments worldwide are shifting their policy priorities.

Meanwhile, global growth is steady but underwhelming. Our five-year ahead growth forecast remains at 3.1 percent—well below the pre-pandemic average of 3.7 percent.

This is largely due to declining productivity growth. Total factor productivity, which measures the ability to create more outputs with the same inputs, has been growing at a slower pace since the 2008-09 global financial crisis.

Reviving medium-term growth

My focus today, therefore, is on how to revive medium-term growth. The path to success lies in pursuing structural reforms to raise productivity.

This applies to all countries. In ageing societies—where the share of the working-age population is shrinking—productivity growth has a vital role to play in maintaining living standards.

It also applies to emerging market and developing economies trying to close the gap with richer countries. To provide better jobs and a higher stand of living, they too need to ignite productivity growth.

Without ambitious steps to enhance productivity, global growth is set to remain far below its historical average.

So, what can we do? Let me focus on two priorities that are especially relevant for Asia.

First, innovation. We know that productivity growth increases with technological advances—advances made possible through investments in research and development, a proxy for innovation effort.

Technology transfer, scientific collaboration and policies that fund basic research can foster the kind of innovation we need for long-term growth. And can have a sizeable impact when combined with closer public-private cooperation. In fact, our research shows that productivity growth in advanced economies can increase by 0.2 percentage point a year with a hybrid policy that boosts public research expenditure by a third and doubles subsidies to private research. Because these are average numbers only, the increase could be even higher in emerging markets and developing countries.

Investments in AI are a case in point. No longer an emerging technology, AI is beginning to revolutionize industries and reshape economies. We estimate that AI could boost global GDP growth between 0.1 and 0.8 percentage points per year in the medium term, depending on how it is adopted.

Second, boosting productivity through better resource allocation. The movement of labor and capital toward more productive firms and industries has long been an important source of overall productivity growth. As workers move from farms to factories, for example, their productivity increases dramatically. So too do their income and living standards, with spillovers to the whole economy.

There are many ways countries can achieve a better allocation of resources, including by implementing policies aimed at increasing the mobility of workers, such as re-skilling programs. And more importantly, by strengthening market forces, which create the necessary incentives, through prices and wages.

Asia provides an example of how such reforms can fuel growth. Over the past few decades, Asia prospered as employment and production moved from agriculture to manufacturing. Now, the region contributes over 60 percent of global growth, and is home to some of the world’s largest, most innovative companies.

Continued success, however, requires continued reforms.

Reforms such as strengthening the private sector. Entrepreneurs drive creativity and innovation, investing in sectors with the highest returns. To create the environment they need to thrive, it’s important that there’s a level playing field between the private sector and state-owned enterprises.

For many Asian countries, including China, reforms also involve expanding the services sector.

Services are a potentially important new source of growth. The sector has already drawn about half of the region’s workers, up from just over a fifth in 1990.

And productivity in some services sectors is high. In fact, our analysis shows that Asia’s labor productivity in financial services is four times higher than in manufacturing, and it’s twice as high in business services.

China

In China, reallocating resources to services would have another important benefit: by creating jobs and increasing incomes, it could help boost consumption. A welcome goal that is also a top priority of the government.

While household consumption as a share of GDP in China has risen, it is still among the lowest compared to OECD countries. A sustained increase in consumption’s share of GDP could lead to continued rapid gains in living standards and provide a welcome lift to global demand. This rebalancing of demand also requires reforms to reduce the need for precautionary savings, especially by middle- and lower-income households.

Overall, our analysis suggests that a comprehensive package of reforms to boost consumption and lift productivity could raise China’s potential growth by about 1 percentage point per year over the medium term. That translates into a level of GDP that is close to 20 percent higher than our baseline by 2040.

The IMF’s role

Through our policy advice, lending and capacity development, the IMF has consistently supported countries in establishing macroeconomic and financial stability as a foundation for growth.

To further help in this endeavor, we have formed a new IMF Advisory Council on Entrepreneurship and Growth. The goal is to get new ideas on how countries can ease regulatory barriers, adapt tax systems to a more business-friendly environment, and incentivize long-term savings, so countries have more to spend on innovation.

In this Year of the Snake, let’s embrace change and focus on reforms and policies to revive growth. This will lead to better prospects for people everywhere.

Thank you.

Remarks by International Monetary Fund Deputy Managing Director Nigel Clarke at the China Development Forum
Beijing, China, March 23, 2025

https://www.imf.org/en/News/Articles/2025/03/23/sp032325-dmdclarke-chinadevtforum?s=03

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