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F R O M D E V E L O P I N G T O D E V E L O P E D
W H O S E R E S P O N S I B I L I T Y I S I T ?
in
Report to the NationFor the period January 2017 – March 2017Presented April 27, 2017
J A M A I C A
W H O S E R E S P O N S I B I L I T Y
I S I T ?
in
3
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OW
TH
One year ago, the Hon. Andrew Holness, Prime Minister of Jamaica, took the bold decision to appoint the Economic Growth Council (EGC) to consult widely and advise the Cabinet on a collection of broad platform policies and reforms that would facilitate economic growth.
By September 2016, following over 80 consultative meetings with various stakeholders, we recommended eight growth initiatives to the Cabinet in our bid to achieve 5% growth in Gross Domestic Product (GDP) by 2020 – a target set by the EGC.
Some of these recommendations were included as policy actions in the Stand-By Arrangement (SBA)
signed with the International Monetary Fund (IMF) in 2016, which, in turn, defined deliverables and timelines to be monitored by the EGC.
This second quarterly Report to the Nation covers deliverables for the period January – March 2017 and we are pleased to confirm that most of the critical policy actions have been achieved, some ahead of schedule. A few have been delayed, mainly due to the need for increased human resources which the Government is trying to address. New timelines have been set for their implementation which we are closely monitoring.
The cost of crime and violence to our country is one of the most serious constraints to achieving
I M P R O V I N G C I T I Z E N S E C U R I T Y & P U B L I C S A F E T Y – I T ’ S O U R C O L L E C T I V E R E S P O N S I B I L I T Y
4
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meaningful, sustainable and inclusive growth. Reducing crime and violence in our country is an imperative! We are not speaking solely about fighting crime, but also about how to create a country where people want to live, work, raise families and do business. Of the 111 specific policy recommendations the EGC made to the Government, almost a half are related to Improving Citizen Security and Public Safety.
In this regard, the EGC has established a Working Committee, chaired by Major General Antony Anderson, National Security Advisor, which is comprised of the heads and senior representatives of the Ministries Department and Agencies (MDAs) involved in addressing this issue. The Working Committee, must be commended for meeting their targets, some ahead of schedule. As at April 2017, 5 of the 9 benchmarks, including 3 with an October 2017 deadline, have been met.
The EGC’s Access to Finance Committee, chaired by Milverton Reynolds, Managing Director, Development Bank of Jamaica, also met their targets. Here we must acknowledge the work done by the Bank of Jamaica; Financial Services Commission; Development Bank of Jamaica and the Ministry of Industry, Commerce, Agriculture & Fisheries (MICAF) in this area. The recommendations in this Initiative are crucial to providing MSMEs with more access to financing.
In the areas of Improved Business Climate and reduction of red-tape, a Steering Committee, chaired by the Permanent Secretary of MICAF, has been established to drive this crucial area which we all have identified as representing severe constraints to growth. We note, however, that completion of the Procurement Regulations and Handbook have been delayed for two months. Equally, several of the deliverables under the Asset Utilisation initiative were not met and we are working closely with the MDAs to push for their completion by May.
The EGC continues to work with the various stakeholders. These meetings are now focused on IMPLEMENTATION. We are working with MDAs to help remove roadblocks, towards better coordination and communication among MDAs and to facilitate the timely implementation of the recommendations.
We have completed over 150 consultative meetings and we truly appreciate the cooperation and support of members of the public and private sectors, trade unions and general citizenry as we all work to achieve 5% GDP growth by 2020.
We all have a part to play. This is a collective exercise which needs all hands on deck to achieve success.
Michael Lee-ChinChairman, Economic Growth Council
5
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RT
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RS
HI
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FO
R
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OW
TH
ECO
NO
MIC
GR
OW
TH C
OU
NC
IL
POLI
CY
REC
OM
MEN
DA
TIO
NS
INC
LUD
ED I
N T
HE
3-YE
AR
IM
F ST
AN
D-B
Y A
RR
AN
GEM
ENT
(REP
ORT
ING
PER
IOD
: JA
NU
ARY
- M
AR
CH
201
7)
REFO
RM A
REA
MEA
SURE
SD
UE
DAT
ERE
SPO
NSI
BLE
MIN
ISTR
Y/
DEP
ARTM
ENT/
AG
ENCY
STAT
US
CIT
IZE
N
SE
CU
RIT
Y A
ND
P
UB
LIC
SA
FE
TY
Subm
it to
Cab
inet
a p
lan
for t
he ra
tiona
lisat
ion
of p
olic
e st
atio
ns, t
he re
depl
oym
ent o
f ass
ets i
nto
high
crim
e ar
eas a
nd a
m
ore
mob
ile st
rate
gy fo
r pol
icin
g.
Mar
-17
Min
istry
of N
atio
nal
Secu
rity
(MN
S)
Com
plet
e ph
ased
impl
emen
tatio
n of
mea
sure
s to
allo
w
witn
esse
s to
give
evi
denc
e vi
a vi
deo-
link.
Mar
-17
Min
istry
of J
ustic
e (M
OJ)
Impr
ove
bord
er se
curit
y an
d en
hanc
e m
onito
ring
of Ja
mai
ca’s
air a
nd m
ariti
me
spac
e th
roug
h an
initi
al a
cqui
sitio
n of
su
rvei
llanc
e ai
rcra
ft an
d m
arin
e pa
trol v
esse
ls le
adin
g to
war
ds
the
even
tual
dev
elop
men
t of a
full
Dom
ain
Awar
enes
s Cen
tre.
Mar
-17
MN
S-JD
F
**M
odifie
d M
easu
reCo
mpl
eted
/On
Trac
kTa
rget
Miss
ed
KEY
6
PA
RT
NE
RS
HI
P
FO
R
GR
OW
TH
REFO
RM A
REA
MEA
SURE
SD
UE
DAT
ERE
SPO
NSI
BLE
MIN
ISTR
Y/
DEP
ARTM
ENT/
AG
ENCY
STAT
US
AC
CE
SS
TO
F
INA
NC
E
Expa
nd th
e siz
e of
the
parti
al c
redi
t gua
rant
ee p
rogr
amm
e at
th
e D
evel
opm
ent B
ank
of Ja
mai
ca.
Mar
-17
Min
istry
of E
cono
mic
G
row
th a
nd J
ob
Crea
tion
(MEG
JC)-
Dev
elop
men
t Ban
k of
Jam
aica
(DBJ
)
Com
men
ce p
hase
d re
view
s of b
anki
ng, i
nsur
ance
and
pen
sions
re
gulat
ions
that
impa
ct ac
cess
to fin
ance
.(i)
Pu
rsue
requ
ired
amen
dmen
ts to
legi
slatio
n to
allo
w fo
r in
vent
ory
and
rece
ivab
les,
inta
ngib
le p
rope
rty a
nd o
ther
no
n-tra
ditio
nal a
sset
s ide
ntifie
d un
der t
he S
ecur
ed In
tere
st in
Per
sona
l Pro
perty
Act
(SIP
PA) t
o be
reco
gnise
d as
se
curit
y un
der t
he B
ank
of Ja
mai
ca (B
OJ)
regu
latio
ns.
Mar
-17
Min
istry
of I
ndus
try
Com
mer
ce
Agric
ultu
re a
nd
Fish
erie
s (M
ICAF
)
(ii)
Purs
ue a
men
dmen
ts to
BO
J re
gula
tions
to a
llow
for
capi
tal r
elie
f for
the
porti
on o
f an
SME
loan
that
has
a
DBJ
gua
rant
ee u
nder
the
Cred
it En
hanc
emen
t Fac
ility
pr
ogra
mm
e w
here
that
gua
rant
ee is
bac
ked
by se
greg
ated
fu
nds.
Mar
-17
Min
istry
of F
inan
ce
and
Publ
ic S
ervi
ce
(MO
FPS)
-BO
JD
BJ
(iii)
Revi
ew th
e M
inim
um C
apita
l Tes
t (M
CT) r
equi
rem
ent f
or
insu
ranc
e co
mpa
nies
.M
ar-1
7M
OFP
S-Fi
nanc
ial
Serv
ices
Com
miss
ion
(FSC
)
BU
SIN
ES
S C
LIM
AT
E A
ND
R
ED
-TA
PE
Begi
n re
gula
tory
revi
ew o
f lic
ensin
g, p
erm
ittin
g an
d re
gula
tory
pr
oces
ses i
n fis
herie
s, ve
terin
ary,
agric
ultu
ral, p
harm
aceu
tical,
he
alth
and
qua
lity
cont
rol d
ivisi
ons o
f gov
ernm
ent a
imed
at
boos
ting
effic
ienc
y and
bus
ines
s com
petit
ivene
ss.
Mar
-17
MIC
AFM
inist
ry o
f Hea
lth
(MO
H)
Com
plet
e th
e Pu
blic
Pro
cure
men
t Reg
ulat
ions
and
the
Hand
book
of P
ublic
Sec
tor P
rocu
rem
ent P
roce
dure
s.M
ar-1
7M
OFP
S
Tabl
ing
in P
arlia
men
t of t
he B
uild
ing
Act.
Mar
-17
Min
istry
of L
ocal
G
over
nmen
t an
d Co
mm
unity
D
evel
opm
ent
(MLG
CD)
AS
SE
T U
TIL
ISA
TIO
N
Crea
te fr
amew
ork
for p
ublic
deb
t red
uctio
n th
roug
h a
prog
ram
me
of p
rivat
isatio
ns a
nd a
sset
sale
s.M
ar-1
7 M
OFP
S
Subm
it to
cab
inet
a p
lan
to d
ives
t up
to 2
0% o
f ass
ets h
eld
by
the
Urba
n D
evel
opm
ent C
orpo
ratio
n (U
DC)
and
the
Fact
orie
s Co
rpor
atio
n of
Jam
aica
(FCJ
).
Mar
-17
MEG
JC-U
DC
FCJ
Impr
ove
the
scala
bilit
y and
effi
cienc
y of t
he p
rivat
isatio
n, as
set
sale
and
pub
lic/p
rivat
e-pa
rtner
ship
pro
cess
es b
y:
(i)
DBJ
mak
ing
prov
ision
in C
orpo
rate
Pla
n fo
r add
ition
al
num
ber o
f Acc
ount
Exe
cutiv
es w
ho h
andl
e su
ch
trans
actio
ns**
Mar
-17
MEG
JC-D
BJ
(ii)
Com
men
cing
the
proc
ess t
o pr
ocur
e or
iden
tify
dedi
cate
d st
aff a
t the
Atto
rney
Gen
eral
’s Ch
ambe
rs a
nd th
e M
inist
ry o
f Fin
ance
who
are
exc
lusiv
ely
focu
sed
on th
ese
trans
actio
ns**
Mar
-17
MO
JM
OFP
S
7
PA
RT
NE
RS
HI
P
FO
R
GR
OW
TH
REFO
RM A
REA
MEA
SURE
SD
UE
DAT
ERE
SPO
NSI
BLE
MIN
ISTR
Y/
DEP
ARTM
ENT/
AG
ENCY
STAT
US
AC
CE
SS
TO
F
INA
NC
E
Expa
nd th
e siz
e of
the
parti
al c
redi
t gua
rant
ee p
rogr
amm
e at
th
e D
evel
opm
ent B
ank
of Ja
mai
ca.
Mar
-17
Min
istry
of E
cono
mic
G
row
th a
nd J
ob
Crea
tion
(MEG
JC)-
Dev
elop
men
t Ban
k of
Jam
aica
(DBJ
)
Com
men
ce p
hase
d re
view
s of b
anki
ng, i
nsur
ance
and
pen
sions
re
gulat
ions
that
impa
ct ac
cess
to fin
ance
.(i)
Pu
rsue
requ
ired
amen
dmen
ts to
legi
slatio
n to
allo
w fo
r in
vent
ory
and
rece
ivab
les,
inta
ngib
le p
rope
rty a
nd o
ther
no
n-tra
ditio
nal a
sset
s ide
ntifie
d un
der t
he S
ecur
ed In
tere
st in
Per
sona
l Pro
perty
Act
(SIP
PA) t
o be
reco
gnise
d as
se
curit
y un
der t
he B
ank
of Ja
mai
ca (B
OJ)
regu
latio
ns.
Mar
-17
Min
istry
of I
ndus
try
Com
mer
ce
Agric
ultu
re a
nd
Fish
erie
s (M
ICAF
)
(ii)
Purs
ue a
men
dmen
ts to
BO
J re
gula
tions
to a
llow
for
capi
tal r
elie
f for
the
porti
on o
f an
SME
loan
that
has
a
DBJ
gua
rant
ee u
nder
the
Cred
it En
hanc
emen
t Fac
ility
pr
ogra
mm
e w
here
that
gua
rant
ee is
bac
ked
by se
greg
ated
fu
nds.
Mar
-17
Min
istry
of F
inan
ce
and
Publ
ic S
ervi
ce
(MO
FPS)
-BO
JD
BJ
(iii)
Revi
ew th
e M
inim
um C
apita
l Tes
t (M
CT) r
equi
rem
ent f
or
insu
ranc
e co
mpa
nies
.M
ar-1
7M
OFP
S-Fi
nanc
ial
Serv
ices
Com
miss
ion
(FSC
)
BU
SIN
ES
S C
LIM
AT
E A
ND
R
ED
-TA
PE
Begi
n re
gula
tory
revi
ew o
f lic
ensin
g, p
erm
ittin
g an
d re
gula
tory
pr
oces
ses i
n fis
herie
s, ve
terin
ary,
agric
ultu
ral, p
harm
aceu
tical,
he
alth
and
qua
lity
cont
rol d
ivisi
ons o
f gov
ernm
ent a
imed
at
boos
ting
effic
ienc
y and
bus
ines
s com
petit
ivene
ss.
Mar
-17
MIC
AFM
inist
ry o
f Hea
lth
(MO
H)
Com
plet
e th
e Pu
blic
Pro
cure
men
t Reg
ulat
ions
and
the
Hand
book
of P
ublic
Sec
tor P
rocu
rem
ent P
roce
dure
s.M
ar-1
7M
OFP
S
Tabl
ing
in P
arlia
men
t of t
he B
uild
ing
Act.
Mar
-17
Min
istry
of L
ocal
G
over
nmen
t an
d Co
mm
unity
D
evel
opm
ent
(MLG
CD)
AS
SE
T U
TIL
ISA
TIO
N
Crea
te fr
amew
ork
for p
ublic
deb
t red
uctio
n th
roug
h a
prog
ram
me
of p
rivat
isatio
ns a
nd a
sset
sale
s.M
ar-1
7 M
OFP
S
Subm
it to
cab
inet
a p
lan
to d
ives
t up
to 2
0% o
f ass
ets h
eld
by
the
Urba
n D
evel
opm
ent C
orpo
ratio
n (U
DC)
and
the
Fact
orie
s Co
rpor
atio
n of
Jam
aica
(FCJ
).
Mar
-17
MEG
JC-U
DC
FCJ
Impr
ove
the
scala
bilit
y and
effi
cienc
y of t
he p
rivat
isatio
n, as
set
sale
and
pub
lic/p
rivat
e-pa
rtner
ship
pro
cess
es b
y:
(i)
DBJ
mak
ing
prov
ision
in C
orpo
rate
Pla
n fo
r add
ition
al
num
ber o
f Acc
ount
Exe
cutiv
es w
ho h
andl
e su
ch
trans
actio
ns**
Mar
-17
MEG
JC-D
BJ
(ii)
Com
men
cing
the
proc
ess t
o pr
ocur
e or
iden
tify
dedi
cate
d st
aff a
t the
Atto
rney
Gen
eral
’s Ch
ambe
rs a
nd th
e M
inist
ry o
f Fin
ance
who
are
exc
lusiv
ely
focu
sed
on th
ese
trans
actio
ns**
Mar
-17
MO
JM
OFP
S
**M
odifie
d M
easu
reCo
mpl
eted
/On
Trac
kTa
rget
Miss
ed
KEY
8
PA
RT
NE
RS
HI
P
FO
R
GR
OW
TH
REFO
RM A
REA
MEA
SURE
SD
UE
DAT
ERE
SPO
NSI
BLE
MIN
ISTR
Y/
DEP
ARTM
ENT/
AG
ENCY
STAT
US
(iii)
DBJ
pro
vidi
ng a
pro
toco
l for
the
esta
blish
men
t of
Ente
rpris
e Te
ams t
hat h
andl
e m
ultip
le tr
ansa
ctio
ns**
Mar
-17
DBJ
(iv)
Subm
it to
cab
inet
the
prot
ocol
and
fram
ewor
k fo
r the
ou
tsour
cing
of p
rivat
isatio
ns to
for-p
rofit
firm
sM
ar-1
7D
BJ
DIA
SP
OR
A IN
VO
LVE
ME
NT
Prep
are
draf
t pro
posa
l on
inst
itutio
nal f
ram
ewor
k fo
r pro
mot
ing,
co
ordi
natin
g an
d or
gani
sing
econ
omic
and
soci
al in
vest
men
ts
by th
e D
iasp
ora*
*
Mar
-17
Min
istry
of F
orei
gn
Affa
irs a
nd Tr
ade
(MFA
FT)
MO
FPS
MEG
JC
Begi
n fe
asib
ility
stud
y of
the
crea
tion
of a
Glo
bal J
amai
can
Imm
igra
tion
Card
for i
ssua
nce
to m
embe
rs o
f the
Dia
spor
aM
ar-1
7M
NS
**M
odifie
d M
easu
reCo
mpl
eted
/On
Trac
kTa
rget
Miss
ed
KEY
9
PA
RT
NE
RS
HI
P
FO
R
GR
OW
TH
Access to Finance Mr. Milverton Reynolds, Managing Director,Development Bank of Jamaica
Citizen Security and Public Safety Major General Antony Anderson, National Security Advisor
Immigration Policy Mrs. Helene Davis-Whyte, President of the Jamaica Confederation of Trade Unions
Diaspora Involvement Dr. David Panton, Chairman and CEO,Panton Equity Partners
C H A I R P E R S O N SW o r k i n g C o m m i t t e e s
E G C S T A K E H O L D E R C O N S U LT A T I O N S
Hon. Michael Lee-Chin, OJ, (left), Chairman of the Economic Growth Council (EGC) greets Hugh Johnson, President, Small Business Association of Jamaica (SBAJ) at a EGC consultative meeting at Jamaica House on April 12, 2017. At centre is Oswald Smith, former President, SBAJ
10
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RT
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FO
R
GR
OW
TH
E G C S T A K E H O L D E R C O N S U LT A T I O N S
Hon. Michael Lee-Chin, OJ; EGC Chair (3rd l), addresses a consultative meeting at Jamaica House. (R-L) EGC members Adam Stewart, OD, Paula Kerr-Jarrett, Hon. Hugh Hart, OJ, Hon. Noel Hylton, OJ, JP and Pat Ramsay, OD.
Hon. Michael Lee-Chin, OJ (left), Chairman of the Economic Growth Council (EGC) and Paula Kerr-Jarrett, EGC Member, greet Amb. The Hon. Douglas Saunders, OJ., at a consultative meeting with Permanent Secretaries at Jamaica House.
Maureen Denton (seated 2nd left), Head of the Economic Growth Council (EGC) Secretariat with a group of stakeholders including representatives of the Ministry of Economic Growth & Job Creation; Permanent Secretary and representatives of MLGCD, JAMPRO and the Cabinet Office following a consultative meeting at Jamaica House.
Representatives of The Financial Services Commission pose with members of the Economic Growth Council (EGC) following a consultative meeting at Jamaica House.
Maureen Denton (seated 2nd left), Head of the Economic Growth Council (EGC) Secretariat with a group of Procurement Analysts; Deputy Financial Secretary, representatives of the Ministry of Finance & The Public Sector; the Attorney General’s Department, and the Ministry of Industry, Commerce, Agriculture & Fisheries, following a consultative meeting at Jamaica House.
Lisa Bell, Managing Director, EXIM Bank, addresses the meeting between the Economic Growth Council (EGC) and the Small Business Association of Jamaica (SBAJ). At her left is Hugh Johnson, President of the SBAJ.
11
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RT
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OW
TH
N C U “ E N T R E P R E N E U R S ” W I N N A T I O N A L B U S I N E S S M O D E L C O M P E T I T I O N F O R T H E F O U R T H T I M E
Jamaican youth continue to demonstrate entrepreneurial ability at appreciable levels. The Fourth Annual National Business Model Competition (NBMC), a Development Bank of Jamaica (DBJ) initiative anchored at the Private Sector Organization of Jamaica (PSOJ) recently saw Team “Natsima Nutraceuticals” from the Northern Caribbean University (NCU) emerging as champions for the fourth consecutive year.
The NCU team, which uses plant products to develop natural treatment for sinusitis, beat teams from the Edna Manley College of the Visual & Performing Arts, the University of the West Indies and University of Technology.
The NBMC provides an opportunity for students to put entrepreneurship principles into practice through an integrated learning
experience; provides linkages between budding entrepreneurs and private sector mentors and financiers, encourages potential entrepreneurs and supports economic growth and job creation. With leadership and technical support from the DBJ, the competition benefits from financial support from the Multilateral Investment Fund of the Inter-American Development Bank (IDB) and Jamaica’s corporate community.
“Natsima Nutraceuticals” will now represent Jamaica at the International Business Model Competition (IBMC) at the Computer History Museum, Silicon Valley, California.
Jamaica has consistently done well at the IBMC, placing in the top 10 out of 42 competing universities.
L-R Audrey Richards, Project Consultant, Jamaica Venture Capital Programme, Development Bank of Jamaica (DBJ); Milverton Reynolds, Managing Director, DBJ; Hazel O’Conner, Coordinator, Northern Caribbean University (NCU) – Morris Entrepreneurship Centre; Members of Natsima Nutraceuticals: Finoa Bowley, Oshane Solomon, Shanea Wint, Lancelot Riley and Alston Miller. Dr. Lincoln Edwards, President, NCU is at far right.
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R E A L S E C T O R P E R F O R M A N C E ( O C T O B E R - D E C E M B E R 2 0 1 6 ) & S H O R T-T E R M P R O S P E C T S
} Macroeconomic conditions in Jamaica continued to improve, evidenced by:
- A reduction in the current account deficit; low and stable inflation and inflation expectations; lowering of public debt to GDP ratio
- The highest business and consumer confidence levels in fifteen years
- Increased external demand for some Jamaican exports (tourism)
- Increased employment levels.
} The latest data from the STATIN indicated real GDP growth of 1.1% for October – December 2016 relative to the similar quarter of 2015. This represented eight consecutive quarters of economic growth. For this quarter,
- Real value added of the Goods Producing Industry is estimated to have increased by 3.1% due to estimated growth in two of the four industries. The industries for which value added increased were Agriculture, Forestry & Fishing (up 17.1%) and Construction (up 0.6%). The Mining & Quarrying and Manufacturing industries were estimated to have contracted by 11.9% and 0.2% respectively.
- The Services industry grew by 0.6%, as all industries with the exception of Producers of Government Services
recorded increases. Among the industries estimated to have realised an increase in value added were: Electricity & Water Supply (up 2.0%); Finance & Insurance Services (up 1.0%); and Hotels & Restaurants (2.5%).
} For the January – March 2017 quarter, real GDP is expected to grow within the range of 0.8% to 1.8%. This out-turn is predicated on:
- The continued strengthening of productive activities in both the Goods Producing and Services industries. Within the Goods Producing Industry, the performance of the Construction industry is expected to be bolstered by efforts to accelerate the implementation of major road infrastructure projects under the Major Infrastructure Development Programme (MIDP) and manufacturing will continue to be driven by continued increases in food processing. The performance of the Agriculture, Forestry & Fishing industry, however, was tempered by drought conditions experienced during January - March 2017. For the Services industry, it is anticipated that the Hotels & Restaurants industry will be the main driver of growth, as it continues to benefit from increased visitor arrivals.
} For Financial Year 2016/17, real GDP growth of 1.6% is projected, underpinned
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by real value added increases in the Goods Producing and Services industries. The industries expected to be the most significant contributors to growth for Financial Year 2016/17 are Agriculture, Forestry & Fishing; Electricity & Water Supply; and Hotels & Restaurants.
} Growth of 2.3% is projected for Financial Year 2017/18, predicated primarily on improvements in all industries with the exception of Producers of Government Services. It is anticipated that growth will be supported by:
- The expected reopening of the Alpart Alumina Refinery following its sale to a Chinese producer (Jiquan Iron & Steel Company)
- A strengthening of domestic confidence levels
- Growth in the economies of Jamaica’s trading partners
- Improved efforts at implementing GOJ-supported growth-inducing projects, ie. more timely disbursements and implementation.
Growth projected for the Jamaican economy is against the background of benefits to be gained from the implementation of the GOJ’s macroeconomic programme. This programme is supported by a 3-year IMF-approved SBA, which is focused on macroeconomic stability and job creation.
(Prepared by the PIOJ)
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This Declaration of Intent is entered into between the GOVERNMENT OF JAMAICA (“GOJ” or “Government”), executing and implementing through its MINISTRY OF ECONOMIC GROWTH AND JOB CREATION, with office at 25 Dominica Drive, Kingston 5 in the parish of Saint Andrew and THE ECONOMIC GROWTH COUNCIL (the “Council” or the “EGC”), a body appointed by the Government, each a party and together, the parties.
PREAMBLEWHEREAS
(i) Jamaica’s economy has stagnated over the last forty years with high levels of debt, unemployment and crime and violence. Jamaica has been on a trajectory of decreasing real GDP growth decade after decade. Over the last twenty (20) years real GDP growth averaged 0.5% per annum and 0.2% per annum over the last ten (10) years. The country consistently ranks among the slowest growing developing countries in the world;
(ii) Jamaicans have made sacrifices over the past few years in the process of implementing and adhering to a necessary programme of fiscal consolidation. Although this programme created macro-economic stability, expansion in output has lagged and GDP growth has been slow and remains low;
(iii) The GOJ is committed to enabling sustainable and inclusive economic growth;
(iv) The GOJ established the Economic Growth Council on 27th April 2016. The Council was mandated to consult widely and to advise the Government on a framework of growth initiatives designed to facilitate and catalyse economic growth. The Council held over eighty (80) consultative meetings with diverse stakeholders including the Opposition, private and public sector entities, Ministries, Departments and Agencies (“MDAs”), the Jamaica Confederation of Trade Unions, members of academia, the media, diplomatic missions and multilateral development agencies. It reviewed the extensive literature and studies on the Jamaican economy, crime and violence and other factors impacting growth and development; and
(v) On September 12, 2016, the EGC recommended to a meeting of Cabinet eight growth initiatives (the “Growth Initiatives”). The recommended Growth Initiatives reflect the views of the stakeholders consulted and findings reported in studies and reports regarding the major factors that continue to retard Jamaica’s economic growth. They are therefore focused on the removal of the major obstacles to growth and the creation of an environment conducive to economic growth and development.
A R T I C L E 1
P U R P O S E
1.1 The purpose of this Declaration of Intent (the “Declaration”) is to record the intention of
(vi) the GOJ to implement the Growth Initiatives listed in 2.1.1 below; and
(vii) the EGC to fulfill its mandate as set out in its Terms of Reference, dated 27 April 2016 (the “Terms of Reference”). The Terms of Reference is attached hereto as Appendix I. A list of the members appointed by the GOJ to the EGC is also attached as Appendix 2.
A R T I C L E 2
D E C L A R AT I O N
2.1 The Government
2.1.1 The GOJ agrees with the following eight Growth Initiatives recommended by the EGC:
(i) MAINTAIN MACRO-ECONOMIC STABILITY AND PURSUE DEBT REDUCTION
(ii) IMPROVE CITIZEN SECURITY AND PUBLIC SAFETY
(iii) IMPROVE ACCESS TO FINANCE
(iv) PURSUE BUREAUCRATIC REFORM TO IMPROVE THE BUSINESS ENVIRONMENT
(v) STIMULATE GREATER ASSET UTILISATION
(vi) BUILD HUMAN CAPITAL
(vii) HARNESS THE POWER OF THE DIASPORA
(viii) CATALYSE THE IMPLEMENTATION OF STRATEGIC PROJECTS
2.2 The Economic Growth Council
2.2.1 The EGC in accordance with its mandate intends to:
(i) Receive reports and periodic briefings from the MDAs on the Growth Initiatives and to monitor their progress in achieving the Growth Initiatives.
(ii) Support the MDAs in the implementation of the Growth Initiatives, as required.
(iii) Raise with the Prime Minister / Cabinet, any concern which may arise with respect to the implementation of the Growth Initiatives.
(iv) Report on a quarterly basis to the Jamaican people on the progress of attainment of the Growth Initiatives.
D E C L A R A T I O N O F I N T E N T
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(v) Support the GOJ in securing investment for Jamaica.
2.3 Monitoring, Reporting and Implementation
2.3.1 The GOJ and the EGC will agree to a monitoring, evaluation and reporting framework and a mechanism for removing constraints to ensure the timely implementation of the recommendations related to the Growth Initiatives, provided that the framework is to be agreed within fourteen (14) days of the date of this Declaration of Intent or such time as the parties mutually agree. The framework will set out the implementation steps, timelines and responsible party as identified by the GOJ with respect to each recommendation. A system for the collection, dissemination of information and reporting on progress against the deliverables will also be agreed to.
2.3.2 The GOJ commits to provide in a timely manner to the EGC such information and access to the relevant MDAs as the EGC requests and needs to efficiently undertake its responsibilities.
2.3.3 The GOJ agrees to make good faith efforts to find the resources necessary for the timely implementation of the Growth Initiatives.
A R T I C L E 3
G E N E R A L P R O V I S I O N S
3.1 The parties acknowledge that this Declaration does not constitute or create, and shall not be deemed to constitute or create, any legally binding or enforceable obligation on the part of either party to this Declaration, nor does it create an obligation to commitment of funds by any party to this Declaration. Nor shall any third party obtain any legal benefit from this Declaration.
3.2 Specifically, the EGC acknowledges that while the GOJ undertakes to identify the human and material resources required to implement the specific recommendations, the parties agree that nothing in this Declaration constitutes, or shall be construed as a statement by the GOJ that it has identified at this time all the resources and financing necessary to implement all the recommendations proposed by the EGC.
3.3 The GOJ acknowledges and agrees that neither the EGC nor its members in their individual or corporate capacity shall have any obligation towards the financing of the Growth Initiatives.
3.4 The EGC shall not take any step to create any binding obligation for the GOJ unless it has first sought and obtained the written approval of the GOJ subject to, and in addition to, any other requirements set out in the Confidentiality Agreement executed by the members of the EGC.
3.5 The EGC shall also notify the Prime Minister / Cabinet of any public announcement to be made and shall obtain the approval of the Prime Minister / Cabinet prior to publishing same.
3.6 This Declaration of Intent becomes effective on the date of signing. The Declaration may be amended at any time on the mutual agreement of the parties. The Declaration of Intent may also be amended at any time by the GOJ in keeping with its policy objectives, and may be amended at the request of the EGC subject to the mutual agreement of the parties. It is intended that this Declaration of Intent will expire on the 26th of April 2020. However, either party may earlier terminate this
Declaration upon written notice to the other party.
IN WITNESS WHEREOF, the parties duly sign this Declaration of Intent on 7 November 2016.
For the Government of Jamaica:
___________________________________________
The Most Honourable Andrew Holness, ON, MPPrime Minister & Minister of Economic Growth and Job Creation
For the Economic Growth Council:
___________________________________________
Honourable Michael Lee-Chin, OJChairman
We, the undersigned, agree that we have read and understand this Declaration of Intent. Each of our signatures below indicate the concurrence with and support of our organisation of the Growth Initiatives set out herein and the agreement of our organisation to collaborate with the Government and the EGC, as we deem appropriate, to facilitate the successful implementation of the Growth Initiatives.
The Declaration is open to participation by additional entities at any time upon signature of this Declaration by their authorised representative.
By signing below, we hereby consent to any modifications of the Declaration of Intent mutually agreed to by the Government and the EGC and therefore agree that our signature will not be required for any future modifications.
Each party signing below may terminate its association with this Declaration by sending a written notification to the Government and the EGC for its name to be removed from the list of signatories.
For The Jamaica Confederation of Trade Unions:
___________________________________________Helene Davis WhytePresidentNovember 7, 2016
For The Jamaica Chambers of Commerce:
___________________________________________Warren McDonaldPresidentNovember 7, 2016
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For the Jamaica Manufacturers’ Association Limited:
___________________________________________Metry SeagaPresidentNovember 7, 2016
For The Private Sector Organisation of Jamaica:
___________________________________________Paul B. ScottPresidentNovember 7, 2016
For The Jamaica Exporters’ Association:
___________________________________________Michelle ChongPresidentJanuary 26, 2017
For The American Chamber of Commerce of Jamaica:
___________________________________________Ron McKayPresidentJanuary 26, 2017
For The University of the West Indies:
___________________________________________Sir Hilary Donald BecklesVice-Chancellor, The University of the West IndiesJanuary 26, 2017
For The University of the West Indies at Mona:
___________________________________________Professor Archibald McDonaldPro Vice-Chancellor, The University of the West Indies at MonaJanuary 26, 2017
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NOTES
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NOTES
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Hon. Michael Lee-Chin, OJ Chairman, Economic Growth CouncilChairman, National Commercial Bank
Ambassador Dr. Nigel ClarkeVice Chairman, Economic Growth CouncilDeputy Chairman & CFO, Musson Group of Companies
Senator Kavan Gayle, ODRepresentative from Jamaica Confederation of Trade Unions to the Economic Growth CouncilPresident of the Bustamante Industrial Trade Union
Phillip Gore, OD Founder & Executive Chairman of Gore Developments Limited
Hon. Hugh C. Hart, OJ Senior Partner, Hart, Muirhead & FattaFormer Minister of Mining, Energy and Tourism
Patrick Hylton, CD Group Managing Director, National Commercial Bank
Hon. Noel Hylton, OJ, CD, JPPresident, Noel Hylton and AssociatesFormer Chairman, President and CEO, Port Authority of Jamaica
Paula Kerr-Jarrett Director, Barnett Limited
Pat Ramsay, OD Cultural/Development Consultant
Adam Stewart, OD, CD Deputy Chairman and CEO, Sandals Resorts International
Maureen Denton Executive Director/Head of Secretariat
For Further Information, please contact:Economic Growth Council Secretariat
economicgrowthcouncil
economicgrowthcouncil
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5 in 4
C A L L T O A C T I O N
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Jamaica is blessed with an abundance of natural resources and human potential but somehow these have not been converted to sustainable economic growth for the majority of our independent experience. This has resulted in relative stagnation in standards of living for the majority of Jamaicans vis-à-vis our main trading partners.
The seeming inability to achieve appreciable levels of economic growth now threatens the social fabric of Jamaica and requires all well thinking Jamaicans to join together to achieve a breakthrough in this regard.
We are emboldened by our recent collective experience, where the application of societal resolve towards achieving fiscal sustainability has borne much fruit. Furthermore, we are convinced that building consensus around measures designed to catalyse growth will yield similar results.
Consistent with the Jamaican spirit, our disposition is not to let our historical experience constrain our aspirations. In that regard, we hope to mobilise energies around the goal of elevating our growth experience, above baseline projections, to 5% annual GDP growth in four years (“5 in 4”). As such, we seek your support for the implementation of the recommendations herein, designed to faciliate enterprise and to improve the productivity of labour, capital and technology.
There are many previous reports on an array of social and economic issues that remain on the shelf, unimplemented. In full recognition of this, the Economic Growth Council (“EGC”) has taken the unprecedented step of publishing our recommendations, in bullet form, in the format of a newspaper supplement to
ensure wide distribution. This is motivated by our desire to ensure public participation and engagement in the consensus building and implementation processes. When civil society takes ownership of our problems, and the attendant solutions, change emerges.
We wish to thank the many patriotic Jamaicans from diverse stakeholder groups, including members of the diaspora, who shared their ideas, concerns and hopes and who sat with the EGC or with EGC members and gave of their energy and time. We also wish to thank the friends of Jamaica, the multilateral agencies and diplomatic missions who lent us their expertise.
This has been a reflective exercise and the eight Growth Initiatives that follow represent the fruits of our consultation. This publication does not bring to an end our consultation, however. We hope to memorialise the Growth Initiatives agreed to by the Government in a Declaration of Intent signed with the EGC, the private sector, the unions and civil society and thereafter, consistent with our Terms of Reference, to follow up on implementation and to report to the public on a periodic basis. We hope that the Declaration becomes a living document, updated with the addition of measures as required and agreed, and with the deletion of others as they are implemented.
In the final analysis this is a collective exercise and our success will depend on the level of your participation.
We look forward to hearing from you as we all work together towards “5 in 4”.
Hon. Michael Lee-Chin, O.J.September 25, 2016
STATEMENT FROM THE CHAIRMAN OF THE ECONOMIC GROWTH COUNCIL
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September 19, 2016
Hon. Michael Lee-Chin, OJ Chairman, Economic Growth CouncilEconomic Growth Council Secretariat Jamaica HouseKingston 10
Dear Mr. Lee-Chin,
Re: Economic Growth Council
The Private Sector Organisation of Jamaica (PSOJ), as the umbrella organization of private sector companies, associations and individuals, recognizes the importance of growth in our economy.
Having had discussions, and received reports from the Economic Growth Council (EGC), we wish to express support for the initiatives and policy changes recommended.
Where possible, we are committed to working closely with the EGC to ensure that obstacles that may hinder growth and development are highlighted as we strive to achieve a five percent Gross Domestic Product (GDP) growth by the year 2020.
We are indeed pleased with the direction of the EGC and fully embrace the eight (8) initiatives as we believe it is “a once in a lifetime opportunity” for the Jamaican government to achieve its mandate. We look forward to the positive impact of these initiatives from the combined efforts of the EGC and the government on the Jamaican economy and Jamaica’s future.
Sincerely yours,
The Private Sector Organisation of JamaicaP.B. Scott - President
MSME Alliance (The)Donovan Wignal - President
Small Business Association of JamaicaHugh Johnson - President
Inssurance Asscociation of JamaicaEric Hosin - President
Human Resource Management Association of JamaicaKarl Williams - President Edwin Wint - President
Realtors Association of JamaicaEdwin Wint - President
Jamaica Used Car Dealers AssociationLynvalle Hamilton
Jamaica Security Dealers AssociationJulian Mair - President
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Jamaica’s poor track record of economic growth since our achievement of Independence is evidence that the many initiatives that we have attempted nationally have not borne fruit to any significant level. We cannot hope to keep doing what we have always done and anticipate different results. Accordingly, the all-hands-on-deck approach being proposed by the Economic Growth Council is one that we not only applaud but fully support.
The Jamaica Chamber of Commerce fully supports and is willing to work in partnership with the Economic Growth Council in order to achieve the proposed targets outlined in its growth initiatives. The Chamber believes that private sector businesses are the backbone of a thriving economy and it is imperative that solutions be found to the challenges they experience in doing business in Jamaica.
History will judge us harshly if we do not seize the opportunity to break out of the business-as-usual mode. Let us not go down that road. For our part, the membership of the Jamaica Chamber of Commerce expresses its commitment to playing our part.
The Jamaica Manufacturers’ Association (JMA) is fully aligned with the growth initiatives and policy recommendations proposed by the Economic Growth Council (EGC). This initiative is poised to accelerate Jamaica’s growth rate and engender results and accountability, by targeting economic and non-economic indicators. Whilst not exhaustive, the Association recognises that a systematic policy framework and implementation are critical to achieving a new growth paradigm. The JMA reaffirms our commitment to shape national reforms and to help track the implementation actions launched to spur sustainable growth, create jobs and ensure shared prosperity. We look forward to helping the Government establish an enabling environment for the private sector; the key driver for growth, and encourage broad-based support which is critical to the programme’s success.
September 20, 2016
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INTRODUCTION 2What is Economic Growth? 2What has Jamaica’s annual historical economic growth been?
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Why does Economic Growth Matter? 3Why has sustained economic growth been elusive? 4The roles of Government and private sector in generating economic growth
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The Economic Growth Council 5
MAINTAIN MACRO-ECONOMIC STABILITY AND PURSUE DEBT REDUCTION
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IMPROVE CITIZEN SECURITY AND PUBLIC SAFETY 6Remove profit from crime 7Reorganise the police force 7Accelerate reform of the justice system 10Thoroughly address social exclusion 11Strengthen border control and maintain territorial integrity. 11Resources 12
IMPROVE ACCESS TO FINANCE 12
PURSUE BUREACRATIC REFORM TO IMPROVE THE BUSINESS ENVIRONMENT
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Development and Building Application Approvals 14Interface with the Courts 15Business start-ups 16Paying Taxes 16Port Community System 16Procurement 17Licensing, permitting and approval agencies 17
STIMULATE GREATER ASSET UTILISATION 17
BUILD HUMAN CAPITAL 19Pursue Labour Market Reform 19Implement a growth-oriented, open-door, immigration policy 20
HARNESS THE POWER OF THE DIASPORA 21
CATALYSE THE IMPLEMENTATION OF STRATEGIC PROJECTS 22
IMPLEMENTATION OF GROWTH INITIATIVES 23
table of contents
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What is Economic Growth?
Economic growth refers to an increase in the market value of the goods and services produced by an economy in a period of time.
Economic growth is usually measured by changes in the Gross Domestic Product (GDP) of an economy. When GDP is divided by population size, the result: GDP per capita, is seen as a measure of the average annual income of that population. The GDP per capita is a useful measure to compare the relative performance of countries. A higher GDP per capita usually indicates a higher standard of living.
What has Jamaica’s annual historical economic growth been?
Over the period 1962 – 2015 Jamaica experienced an average annual economic growth of 1.6% per annum compared with average annual economic growth of 3.1 per cent for the global economy over the same period. This performance masks the relatively high GDP growth between the period 1962 – 1972.
In more recent times, Jamaica has been on a trajectory of decreasing real GDP growth decade after decade. See Figure 1 and Table 1 below. Over the last 20 years real GDP averaged 0.5% per annum and over the last 10 years GDP growth was 0.2% per annum. GDP per capita was 5137.90 USD in 2015. Jamaica consistently ranks among the slowest growing developing country in the world.
Figure 1: Jamaica – Economic Growth 1962-2015
Period Average Real Annual GDP Growth Rate (%)1961 to 1970 5.31
1971 to 1980 -0.66
1981 to 1990 2.59
1991 to 2000 0.85
2001 to 2010 0.65
2011 to 2015 0.51
Table 1: Jamaica – Average Economic Growth Rates by Decade 1961-2015
Real GDP growth was 1.0% for FY2015/16 and projected to increase to 1.7% for FY 2016/2017. Jamaicans cannot accept these levels of economic growth as the norm. As such, we ask all Jamaicans to join together to achieve the growth target of 5% real GDP by FY2019/20.
Why does Economic Growth Matter?
Economic growth contributes to the ongoing improvement of living standards and the well-being of the country. Economic growth expands opportunity for all and is the most powerful weapon for reducing poverty, improving the quality of life of Jamaicans and for making Jamaica the place of choice to live, work, raise families and do business.
Decades of very low or no economic growth have had a devastating impact on Jamaica resulting in stagnating levels of real income, high unemployment, rising prevalence of poverty, large scale migration of Jamaicans and loss of capital. Some even attribute our high levels of crime and violence to the persistent inability to expand economic opportunity. Jamaica has become a place where 80% of our young people want to migrate from.
On the contrary, economic growth provides the increase in resources that can support progressively higher levels of investment in infrastructure, as well as higher levels of spending on social services including health, education, security and social protection.
Economic growth allows for investment in sustainable environmental management that can maximize economic returns from the use of natural resources over time, while strengthening the resilience of the built and natural environment and reducing the human and economic costs and losses from the impact of disasters and of climate change.
Economic growth matters as sustained levels of economic growth will allow more and more Jamaicans to realize their dreams, hopes and aspirations right here in Jamaica.
Why has sustained economic growth been elusive?
Sustained economic growth is not easily achieved. A World Bank research showed that out of 117 developing countries with populations of more than half a million, only 18 countries can be defined as having had a successful growth experience in the 1990s, meaning that they had sustained per capita growth of at least one per cent during the 1980s.
Both developed and developing countries are struggling with the issue of how to grow their economies and create more jobs.
The factors that continue to inhibit investment and growth are multifaceted and nuanced. Numerous diagnostic studies and reports have discussed and outlined what are considered the main constraints to economic growth in Jamaica.
In the EGC’s extensive consultations with diverse stakeholders there was unanimous agreement around the main retardants to Jamaica’s economic growth. They are summarised as follows in no special order of priority:
• Crime and violence • Corruption • Access to financing • Taxation/tax compliance cost• Poor human capital and entrepreneurship• Difficult doing business environment /loss of competitiveness
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• High cost of energy • Political tribalism • Competition from the informal sector• Poor capital allocation of our financial
assets and underutilisation of productive capacity
• Macroeconomic instability• Inefficient Government bureaucracy
The roles of Government and private sector in generating economic growth
Simply put, we believe that the role of the Government in the process of economic growth is to provide the enabling
environment that facilitates local and international private enterprise in the process of the domestic production of goods and services. We further believe that Government policy should be steered in the direction of increasing the competitiveness of the Jamaican economy through the provision of public goods that make labour, capital and technology more productive in the Jamaican context.
The Economic Growth Council
Prime Minister, the Most Hon. Andrew Holness appointed the Economic Growth
Council to consult widely and to advise the Cabinet on a collection of broad platform policies and reforms that would facilitate economic growth. These Growth Initiatives are intended to facilitate the removal of various obstacles to economic growth and shake the “trunk of the tree” with the potential to positively impact thousands of businesses and millions of Jamaicans.
According to the Chairman of the EGC, Mr. Michael Lee-Chin; “Our job has been to question, listen, review, read and consult with a view to nurturing consensus on prioritisation for impact. This is a reflective process and our proposals reflect the collective views of fellow Jamaicans across
the private, public and voluntary sectors.”
The Economic Growth Council presented its recommendations to a meeting of the Cabinet on Monday, September 12th. The report updated the Cabinet on its work to date and outlined a set of Growth Initiatives along with specific policy proposals, to achieve higher levels of growth in the Jamaican economy.
The report draws from inputs gained from over 80 consultative meetings held with stakeholders over the past four months. These groupings included various business
groups, the confederation of trade unions, the Opposition, public sector agencies, ministries of government, members of academia, the media, diplomatic missions, and multilateral development agencies among other stakeholders. It also draws from studies and work in the area over the years.
In the words of Ambassador Dr. Nigel Clarke, Deputy Chairman of the EGC, “The good news is that the solutions to Jamaica’s problems are not unknown. They lie in copious reports, studies, commission findings, ministry papers, and executive plans that lie in the ‘filing cabinets of government’. We have reviewed many
unimplemented recommendations and included the most impactful of these.”
The Growth Initiatives translate into numerous specific policy proposals, which have been recommended to the Cabinet for consideration and which the Council aims to communicate through this publication. The Council will continue its ongoing consultation with stakeholders and the wider community in order to facilitate the full participation and ownership of the initiatives by the citizens of Jamaica.
Adam Stewart, Deputy Chairman and
“Our job has been to question, listen, review, read and consult with a view to nurturing consensus on prioritisation for impact. This is a reflective process and our proposals reflect the collective views of fellow Jamaicans across the private, public and voluntary sectors.”
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CEO of the Sandals/ATL Group and a member of the EGC said, “The Growth Initiatives recommended by the EGC are not exhaustive, and are not intended to replace government or to be a parallel form of government. They cannot solve all of Jamaica’s problems. However, they represent a critical and important subset of what needs to be done to achieve economic growth.”
The eight (8) Growth Initiatives are outlined in the sections that follow.
MAINTAIN MACRO-ECONOMIC STABILITY AND PURSUE DEBT REDUCTION • Macro-economic stability is a pre-
requisite for economic growth. The stability we enjoy today has been hard earned but remains fragile. High debt poses a systemic risk to the Jamaican economy and so Jamaica needs to continue the process of fiscal consolidation with a view to achieving debt sustainability. Economic growth and fiscal responsibility are not mutually exclusive. The priority proposals from our consultations include:
• Enter into a successor arrangement with the International Monetary Fund that continues the process of economic reform designed to maintain economic stability, reduce public debt to sustainable levels and generate stronger economic growth.
• Enhance the credibility of the exchange rate regime. We support flexible exchange rates that are based on the competitiveness of the Jamaican economy vis-à-vis its trading partners. However, exchange rates that seem to move only in one direction defy the definition of “flexible” and on that basis we submit that the credibility of the regime needs to be enhanced.
• Pursue debt for assets swaps as a means of accelerating Jamaica’s rate of debt reduction by 2 to 3 percentage points in the medium term. Jamaica has assets that can be sold and the proceeds used to pay down debt. Doing so would further de-risk the economy, improve confidence, and be growth inducing especially if such assets and operations can be put to more efficient use in the private sector.
IMPROVE CITIZEN SECURITY AND PUBLIC SAFETY
• Jamaica has one of the highest per capita levels of homicide and violent crime in the world. As Prof. Anthony Clayton has said, at recent homicide rates, “Jamaica has the equivalent of a 9/11 every week.” This has deterred investment, destroyed capital formation and discouraged business development. The cost of crime and corruption to Jamaica includes low life expectancy, injuries and costly health care, the higher cost of doing business in a low-trust society, losses to theft and extortion, business closures, capital flight, the emigration of skilled workers and the loss of foreign investment. A number of studies have shown that if the rate of crime and violence was reduced to international norms Jamaica’s baseline of economic growth would increase by between two and five percentage points.
• Improving citizen security is therefore the single most important growth-inducing reform that Jamaica can undertake. There must be a substantial and sustained improvement in security and justice before people will feel safe to live, work and invest in Jamaica. We are convinced that this is achievable in the medium term. Progress will require a comprehensive approach, including institutional reform (starting with the police and the justice system), a vigorous and unrelenting drive to eradicate corruption, and bold and decisive action to finally deal with social exclusion.
• There have been far too many partial, uncoordinated and reactive responses to crime that sometimes lacked analysis and perspective, most of which have failed. Piecemeal measures are NOT going to bring about the durable and substantial improvements required. Jamaica’s problems with crime and corruption have deep roots in our society, culture and politics. Solving them will require courage, resolution and a coherent and carefully integrated strategy.
• We have included priority proposals from our consultations below. These must be appropriately planned, integrated and sequenced. These recommended reforms can only work properly as a package, within the context of a sustained programme, and not in isolation.
Remove profit from crime
• Career criminals are not in the business of trafficking narcotics or extortion per se, they are in the business of making money. Most successful career criminals are adaptive, flexible, and ready to switch into more lucrative forms of crime
as they emerge. The only way that these criminal organizations can be degraded or permanently dismantled is by ‘taking the profit from crime’. Policy proposals include:
• Separate the Major Organised Crime and Anti-Corruption Agency (MOCA) from the Jamaica Constabulary Force (JCF); establish it with its own budget, powers of arrest and prosecutorial powers, to form the nucleus of a new national law enforcement agency (similar to the FBI in the United States) with strong operational autonomy.
• Extend the Proceeds of Crime legislation to include lawyers, accountants, bankers and real estate brokers, with appropriate provisions to protect attorney-client privileges.
• Streamline the procedure of Asset Forfeiture making it automatic and not subject to delay pending?on conviction of offences related to organised crime.
• Enact legislation to allow proceeds of seized assets to be used by law enforcement in improving their capabilities and in addressing underlying social ills in the most crime-affected communities.
• Merge the Corruption Prevention Commission, the Integrity Commission and the Office of the Contractor General into a single Anti-Corruption Agency with independent prosecutorial powers.
• Introduce a special court with the necessary technical support and expertise to hear serious and complex cases of organised crime, fraud and money laundering.
• Strengthen the witness protection programme, and accelerate measures to allow witnesses to pre-record their statements and give evidence via video-links.
Reorganise the police force
• It was Law 8 of 1867 that brought the Jamaica Constabulary Force (JCF) into existence as a consequence of the Morant Bay Rebellion. The Act was last substantially amended in 1935. While there have been other amendments since, there has been no substantial amendment that fundamentally changes how the Force was originally conceptualized in 1867. The JCF was originally conceived in paramilitary terms in response to threats to the state. It now needs to complete the process of transformation into a modern police service with a primary focus on citizen security. This requires a strong program of reform, reorganization and technological upgrades that will allow the JCF to achieve its three most important objectives; public reassurance and trust, responding efficiently to calls
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for service, and effectiveness against crime. The priority proposals from our consultations include:
• Review and update the Constabulary Force Act. These amendments should be based on a clear understanding as to what a modern police service is, how it operates, how it thinks, what assets it needs and how those assets are deployed. This new philosophy must be based on the concept of Citizen Security, with the Jamaican citizens seen as the ‘customers’ for policing services.
• Amendments should also facilitate the maintenance and administration of internal discipline in the JCF by – Allowing for the routine use
of polygraphs along with a comprehensive policy framework to formalise and rationalise its use.
– Allowing for drug and alcohol testing in prescribed circumstances.
– Allowing for internal disciplinary action to run parallel to any criminal process.
– Allowing for use of duly seized assets for upgrading the capabilities of the police.
• It is important to address the degradation of the civic environment, aggressive anti-social behaviour and incivilities, all of which encourage public anxiety about crime and social disintegration. Amendments should therefore also include a review of vagrancy and other provisions and empower the JCF to deal with vagrants, people who illegally occupy public spaces for business or other purposes, and intimidating or threatening behaviour in public, with the goal of restoring safe, civic spaces.
• Merge the Police Civilian Oversight Authority and the Police Service Commission. This would allow, for example, that detailed knowledge of an officer’s behaviour and performance (currently held by the Police Civilian Oversight Authority) to be reflected in the system of appointments to senior ranks (controlled by the Police Service Commission), which will ensure that the best candidates are promoted into the senior positions. It will require a minor constitutional amendment to augment the Police Service Commission in this regard.
• Ensure that the JCF is staffed at full establishment. The Jamaica Constabulary Force has an approved total establishment of 14,091, yet the JCF today comprises only 11,219. Given
the capacity of the existing training facilities and the rate of resignations in the police force, the gap will take far too long to fill at the current rate. Given the high incidence of crime and violence, the JCF needs to be at full complement to fulfill its obligations.
• As the size of the JCF increases to establishment levels, reallocate resources to preventative, community policing, and maintain a highly-visible presence in troubled communities with police conducting slow patrols and engaging with the community to deter criminals and reassure citizens.
• Assess the current deployment of police stations with a view to significant rationalisation and redeployment of
assets, with the closure of redundant stations and a significant increase in
deployments in areas such as Westmoreland, St James, St Catherine and Clarendon. All new stations should be based on modern designs, so that police stations become more accessible and welcoming to the public.
• Commit to a more mobile strategy, with fewer officers in stations and more patrols on the street.
• The JCF remains over-centralized, which has weakened the provision of service in other sections of Jamaica. There is a need to devolve management capacity as well as assets to the Geographical Divisions, along with appropriate levels of authority.
• The main paramilitary unit of the JCF, the Mobile Reserve, currently accepts as entrants fresh graduates from the police
academy with little practical experience and untested levels of emotional and psychological development. We strongly endorse recommendations to ensure that officers are recruited to the Mobile Reserve only after serving at least two years in another Division, including experience in front-line policing, and are evaluated for their psychological and emotional maturity and ability to handle stressful situations.
• Create a permanent division of the Mobile Reserve stationed in Western Jamaica.
• Address the problems with vehicle fleet management. At present, many of the JCF vehicles are unusable, due to lack of routine maintenance, while the average age of the fleet is so high that most of them would be regarded as unfit for use by the London police. The JCF must use a modern fleet management system, ensure that vehicles are assigned to front-line stations, and consider outsourcing some elements of the fleet.
• Install radio transmitters or GPS tracking devices in every police vehicle, so
that the dispatchers can ‘see’ where the vehicles are and deploy them accordingly.
• Build Area-based Command and Control Centres and ensure that all systems are computerised so that incidents, responses, developments and deployments across the country can be properly monitored and controlled in real time.
• Establish a policy framework, standards and legislation for the deployment of CCTV camera systems in major urban centres and commercial districts, and ensure that such CCTV
ecosystems are accompanied by appropriate protocol
for monitoring, response and apprehension as required.
• Introduce Body Cameras for all police officers on high-risk operations or on patrols in troubled communities.
• Build area-based modern remand centres to hold detainees pending release, bail or transfer. Staff these remand centres with warders, so that sworn police officers can be reassigned to more urgent duties, and make better use of technology (e.g. security cameras and remote-operated doors) to reduce staffing requirements and operational costs. This releases police officers to perform higher value duties.
• Divert the approximately J$500 million per year in annual rental expenditure paid by the JCF towards financing the construction of dedicated, purpose
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built, buildings and/or stations equipped with appropriate technology.
• Increase the capacity of the police to investigate crimes including cyber crimes.
• Most reported incidents are still recorded in Station Diaries. This means that real-time searching and cross-reference across stations and divisions is not possible, which drastically reduces and compromises the intelligence yield from these data. We recommend rapid replacement of station diaries with computer-based systems.
• Improve crime-scene management, management of the chain of evidence and forensics, with more mobile facilities, and increase the number of government pathologists.
• Improve the surveillance capability of the security forces in both physical and cyber domains.
• Temporarily ban the importation of motorcycles below 500cc rating. Require that riders of motorcycles wear registered helmets and vests that have visible identification numbers that match the registration.
Accelerate reform of the justice system
• The slow pace of the administration of justice is a major obstacle that must be overcome.
• As cases meander through our court system, over years, witnesses lose interest, their memories fade and they become vulnerable to cross-examination. Strong cases are weakened, justice is not served and our collective security is compromised.
• The efficiency of our judicial system is as crucially dependent on the administrative management of the court system as it is on the adequacy and quality of the specialist professionals who comprise the system. Greater attention must be placed on the administration and management of the justice system with higher levels of accountability.
• In 2013, there was a backlog of over 400,000 charges in the court system, 205,000 of which were in Resident Magistrates Courts and 160,000 of which were traffic-related violations. This overloads and congests the system to the point where even serious cases can stretch over many years. Justice only deters crime if the punishment is swift, certain and severe, but the dysfunctional state of the justice system in Jamaica today means that punishment is neither swift nor certain. This means that there is little deterrent to crime. It also creates market opportunities for corruption
and nefarious practices. If crime and violence are to be significantly reduced in Jamaica, the justice system needs to be drastically overhauled and reformed. The priority proposals that arise from our consultations to date include:
• Strengthen the management of the chain of evidence. Strengthen protocols for the preparation and recording of witness statements, police reports and management of evidence from the crime scene to the police storage facility, the forensic laboratory and the court so that all parties can be confident that the witness statements are authentic, the facts in the police report have been accurately recorded and the evidence presented is the same evidence taken from the crime scene.
• Implement efficient electronic record keeping for case files including witness statements and electronic tagging for physical evidence to improve the efficiency, transparency, security and integrity of the records.
• Courts in Jamaica end at 4pm, which is clearly sub-optimal given the large backlog of cases. The fixed court infrastructure lies idle for much of the day. It is recommended that ways are found for the court system to extend opening hours beyond 4pm.
• The ease with which adjournments are obtained allows attorneys to ‘game’ the system, and contributes to the inordinate time it takes to complete cases. It is recommended that clear guidelines are established for adjournments, with a low maximum number of permissible adjournments per trial.
• Finalise plea bargaining legislation.
• Implement the procedures that will allow for the admissibility of evidence given remotely by way of video-link.
• Reform the management of traffic violations to reduce the burden on the court system and address the high levels of non-compliance - simplify the procedure of enforcement, make most fines automatic and make more effective use of evidence from traffic cameras.
• Address the backlog and dysfunctionality at court houses through the digitisation and electronic storage of court documents and information.
Thoroughly address social exclusion
• This is a key dimension. Reforms to policing or justice cannot, in isolation, solve the problems of social exclusion. Children exposed to violence, the murder of family members, or sexual, emotional and psychological abuse,
experience high levels of trauma and stress. Without appropriate social intervention, behavioral problems often emerge which create conditions favorable for gang recruitment and further acts of violence and anti-social behaviour, in a retaliatory cycle.
• Every school in troubled areas must be mandated to develop a programme with the trained personnel to deal with maladaptive behaviour, post-traumatic stress, depression and the consequences of psychological, emotional and sexual abuse of children.
• Implement a Clear, Hold, Build strategy in identified garrison communities in a planned, coordinated and sustained manner, with the goal of creating safe, law-abiding communities with safe civic spaces. This would be led by the JCF, with support from the JDF, but must be fully supported by all other Government Ministries, community and social services.
• A 2008 study estimated that up to 20% of Jamaicans live in informal settlements with no street names, no street numbers and limited access to state social services. This is a threat to law, order, peace and security.
• Review and classify all informal settlements into three tiers, taking action appropriate to the classification
• If settlements are in areas that represent a serious potential threat to human safety (such as unstable slopes or flood-prone gullies), then remove permanent structures, advise the utilities to grant no further approvals for light or water in these settlements, and engage social agencies in resettlements and new housing solutions as a matter of urgency.
• If settlements exhibit major unresolvable planning violations, ensure that no new structures are erected and make plans for all structures to be removed from the problematic areas over a reasonable period of time; engage social agencies in resettlements and new housing solutions.
Evaluate remaining settlements as to (a) quality of life and (b) access to social infrastructure; develop a plan to upgrade the infrastructure and regularize these communities, granting land titles where appropriate.
Strengthen border control and maintain territorial integrity
• Jamaica is an island with an open coastline 1,022 kilometers long and a maritime exclusion zone of 275,000 square kilometers which is 25 times the
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size of our land mass. Jamaica needs to maintain security in this zone for a number of reasons.
• Firstly, all marine resources in this zone belong to Jamaica. Secondly, guns are a weapon of choice in Jamaica yet none are manufactured here. We have no land borders and therefore most guns enter by sea.
• The EGC supports recommendations to broaden maritime domain awareness and control. Acquire surveillance aircraft and offshore patrol vessels to improve the awareness of the security forces of all vessels that come into our maritime space. Security forces should be able to locate, identify, intercept, prosecute all vessels in our maritime space which, among other things, will allow us to stem the flow of illegal weapons. These same tools that provide border security also strengthen territorial integrity reducing the illegal trade in narcotics and human trafficking as well as enabling better environmental management, search and rescue and disaster recovery.
• Implement integrated border control policy. Enact integrated immigration, customs, port authority, maritime police, cruise ship integrated border security policy.
Resources
• This package of reform measures will require more resources to be applied to the appropriate ministries. We are of the view that resources within public bodies are the property of the Jamaican people and must be marshaled and repurposed towards resolution of the most pressing problems faced by the Jamaican people. This is especially the case when those problems conspire to immobilize communities, stifle opportunity and threaten fundamental freedoms.
• Based on this outlook we are convinced that the resources can be made available from a combination of resources available in ministry-controlled public bodies complemented by resources from central government.
IMPROVE ACCESS TO FINANCEFinance is the oxygen of business. Small and medium sized businesses have too hard a problem accessing debt and equity financing. Some of the problems lie with regulatory constraints, competition, and over burdensome taxation. Arguably, aspects of the regulatory framework for the financial sector impede risk taking, which vibrant economies require, rather than promoting the prudent management of risk. Improving access to finance expands
economic opportunity, improves business competition and creates a more meritocratic and fair society. The policy proposals that have emerged from our consultations include:
• Engage in financial sector regulatory review with a view to assessing regulations that impact access to finance and thus growth.
• Pursue required amendments to legislation to allow for inventory and receivables to be recognised as security under the Bank of Jamaica (BOJ) Regulations.
• Pursue amendments to BOJ regulations to allow for capital relief for the portion of a SME loan that has a DBJ guarantee under the Credit Enhancement Facility Programme where that guarantee is backed by segregated funds.
• Pursue regulatory reform with a view to unlocking the ability of pension funds to invest in broader categories of investable assets
• Reduce the minimum capital test (MCT) requirement for insurance companies – which is 250% in Jamaica while in developed countries such as Canada the rate is 150%. This would unlock tens of billions of investable funds that could be diversified away from government bonds and invested in productive activities.
• Undertake measures to promote factoring and lease financing mechanisms.
• Expand the scale and range of financing and capacity development programmes for MSMEs, including through the DBJ partial credit guarantee programme, technical assistance voucher programme and factoring and leasing mechanisms.
• Strengthen the Venture Capital and Angel Investor Eco-System.
• Expand the role of the Credit Bureaus in public rating companies, to facilitate the determination of the level of risk that will be applied to privately issued debt by these companies.
• Develop new housing finance solutions for lower income households, including consideration of housing microfinance.
• Strengthen the operation of the secured transactions framework by the development of a secondary market for repossessed assets.
• Increase the scope and pace of land titling efforts and promote measures to strengthen the use of land tenure rights as collateral.
• Pursue assessment of use of unclaimed funds in the banking and insurance sectors to fund MSMEs.
• Undertake and publish a study on banking competition and pursue policies
to increase competition in the banking industry in the medium term.
• Bring taxation on the financial services sector into line with other sectors of the economy.
PURSUE BUREACRATIC REFORM TO IMPROVE THE BUSINESS ENVIRONMENT• Economic growth is usually led by the
growth of small businesses. Enterprises that employ less than 10 persons are crucial to the growth of our economy but our processes make it difficult for them to start, to function and to grow.
• When one thinks about the inadequacies of the public bureaucracy, one needs to do so from the perspective of the firm that has 5, or 7 or 9 employees and ask how much time does it take for them to procure the licenses, the approvals, to pay the tax, to obtain the judgement. One will clearly see that our system works against these firms by imposing an unbearable burden through bureaucratic inefficiency. While larger companies, though hindered, survive the system, for smaller firms our lumbering bureaucracy is an existential threat. This can, and has to, change.
• Businesses have to interface with government in the process of production and sale of goods and services. Across all sectors in Jamaica, businesses complain that such interface is often excessively time-consuming, inefficient and burdensome and this acts as a deterrent to maximization of investment, output and job creation.
• An environment where businesses find it straightforward, simple and predictable to comply with regulations, fulfill requirements for licenses and obtain approvals for plans is an environment that is likely to induce greater economic activity. That is the kind of bureaucratic environment that we need. As such, all aspects of the interface between Government and business are in need of reform to improve effectiveness, efficiency and customer service.
• If we are serious about reform in this arena we need to review the interface institution by institution.
• Our consultations, which have not yet covered all aspects of the government/business interface, have so far yielded the following proposals which are not exhaustive. These will be followed up with refinements and further proposals on a quarterly basis, institution by institution:
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Development and Building Application Approvals
• The process of reform of the land development approval process has been in train for the better part of a decade yet much remains undone. Inter-agency rivalry and vested interests conspire to frustrate the national effort. The public must demand better outcomes. If we could really streamline the development approval process without compromising on standards, we would attract a much larger influx of development initiatives, much of it local which would have a major growth inducing effect.
• Consistent with previous plans, promulgate amendments to the Town & Country Planning Act to allow for the electronic submission of applications and documents to facilitate parallel processing through an upgraded AMANDA system.
• Consistent with previous plans, we advocate for mandatory use of the development approval/building application electronic platform AMANDA or a comparable system at the Parish Council and all referral agencies by end of FY2016/2017 to fulfil all their responsibilities in the building application approval process. This should include visibility into the system by the applicant and the agencies on the status of an application at any given time.
• All building applications should be submitted electronically and the entire commenting and approval processes handled electronically.
• The technical capacity should be built within the local authorities in Disaster Risk Assessments and other areas such that routine matters in these areas can be handled by the local authority and thus reduce the number of commenting
agency approvals required.
• Implement professional certification system to reduce delays caused by substandard applications and work.
• Standardise processes and procedures in all parish councils and commenting agencies.
• Harmonise fee policy and structure across Parish Councils and establish a system of only one fee to be paid by developer/investor. Such fee would include the charges of the individual agencies.
• Complete development of a National Spatial Plan to provide a strategic spatial framework to guide national development and investment decision making. The Plan will ensure the optimal use of the nation’s land and marine resources and outline the framework for their effective use and management.
• Table the Local Improvement Act to allow for the electronic submission of applications and documents to facilitate parallel processing through the AMANDA system.
• Enact the new Building Act.
• Complete Development Orders for all parishes and Portmore.
• Strengthen awareness and use of The Corruption (Prevention) Act. The Act makes soliciting or receiving a bribe by a public servant a criminal offence and also makes the offering or payment of a bribe to a public servant a criminal offence.
• Strengthen awareness and use of the Protected Disclosures (Whistle Blower) Act. The purpose of the Act is to establish procedures to facilitate the disclosure by an employee, to the relevant authorities, of any information regarding any conduct of an employer or fellow employee, which is believed
to constitute improper conduct. It also provides for the protection of any person making these disclosures.
• The suggestion was made by both private and public stakeholders that ‘sting’ operations should be set up to help reduce corruption in the building application process.
• Strengthen internal audit system and establish a functioning sanction/reward system.
• Provide required fiscal, technical and legislative support to implement and enforce all actions in the Development Approval Review Process Implementation Management Plan.
Interface with the Courts
• Businesses interface with the courts routinely, for simple land sub-divisions to contract disputes. Experience suggests that the court system is inefficient and can be improved. The delays in the process of enforcing contracts and settling disputes imposes undue costs on business and contributes to an uncompetitive environment.
• We support existing plans to improve processes to enforce contracts which include (i) mandatory filing of commercial matters in the commercial division of the court and (ii) extending the hours of the courts to facilitate processing of more matters.
• Cap the time to pass judgements on cases in civil courts to six months.
• Implement online platform to track status of legislation from the Chief Parliamentary Counsel.
• Embark on a project to digitize court records
Business start-ups
• Implement on-line system for business registration and incorporation of companies to reduce the turnaround time for applications to two business days.
Paying Taxes
• The 2016 World Bank’s “Doing Business Report” suggests that for businesses to comply with Jamaica’s tax laws it take 45 days each year to pay taxes compared to 15 days for top performing countries. The process of paying taxes in Jamaica is too burdensome and this acts as a disincentive to formalization, a disincentive to compliance and for small businesses who do comply, the process contributes negatively to their competitiveness.
• Economic growth is usually led by the growth of small businesses. Enterprises
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that employ less than 10 persons are crucial to our economy but our processes make it difficult for them to start, to function and to grow.
• Many of the places in towns across Jamaica where taxes are to be paid were built long ago for a different Jamaica. They have inadequate parking spaces and they have inadequate space inside. Starting from scratch today you would not locate tax collecting agencies in those areas.
• We propose reviewing the location of tax collection agencies across Jamaica with a view to addressing shortages in parking and internal customer service space.
• Embark on strategic process engineerig review to reduce the time spent on paying taxes from 45 days to 15 days which is the average of the top performing countries.
• Upgrade Information Technology systems to improve electronic filing and processing.
• This is an area that the EGC will continue to focus on with additional proposals.
Port Community System
• Jamaica is a very open economy where trade amounts to as much as 70% of GDP. However, Jamaica has a complex, inefficient and bureaucratic trade environment that reduces competitiveness. Manual, unstandardized processes that lead to inconsistent and long cargo processing and clearance times divert cargo movement opportunities away from Jamaica and add to the cost of doing business in Jamaica. Much could be gained by decisively correcting this.
• The strategies to address this are understood and have been in train but, like much else, implementation has been behind schedule. Jamaica should fully implement a Port Community System that electronically integrates and streamlines export and import procedures and that will serve as Jamaica’s central hub for trade and logistics information processing.
• In addition, strategies should be implemented that improve documentary and border compliance and fees to international standards.
Procurement
• Government is a major factor in the Jamaican economy. Government spending has an impact on growth and projects undertaken by the Government have an impact on competitiveness, efficiency, service delivery, all of which
impact economic growth.
• The slow pace of implementation of Government projects is often due to an archaic, multi-layered and sometimes redundant procurement process and this saps the vibrancy of the economy and contributes to missed opportunities.
• The public procurement system must be comprehensively overhauled without expanding opportunities for corruption or bias in the procurement process.
• We recommend acceleration of the completion of the Public Procurement Regulations and of the Handbook of Public Sector Procurement Procedures.
Licensing, permitting and approval agencies
• Many businesses rely on government agencies for licenses, permits, quotas, and approvals in the production and sale of goods and services. These are often not glamorous activities and the public is largely unaware of these processes and how insensitive they sometimes are to the needs of business.
• Inefficiency of these processes create expanded opportunities for bribes, corruption and rent-seeking behavior which increase the cost of business, lead to an inefficient allocation of resources and all together reduce the competitiveness of the Jamaican economy.
• The EGC recommends a comprehensive review of the licensing, permitting and regulatory approval processes in the fisheries, veterinary, agricultural, commodity, pharmaceutical, health, quality control standard among other divisions of government.
STIMULATE GREATER ASSET UTILISATIONIncreasing the utilisation of dormant and under-utilised assets would have a major impact on employment and growth. The Urban Development Corporation and the Factories Corporation of Jamaica, for example, collectively own approximately J$100 billion of assets on which they earn a relatively modest return. Most of these assets do not contribute to jobs or employment. Implementing mechanisms that promote greater utilization of these assets could generate employment and induce economic growth.
Public Sector Transformation holds huge scope for improving the efficiency of government. Several functions provided by the Government of Jamaica could, arguably, be better performed by the private sector thereby improving resource allocation. Having a robust, socially responsible
mechanism to accelerate privatisations and asset sales could have a meaningful growth effect.
In addition many agencies and departments of government perform similar and sometimes overlapping functions. Greater asset utilization is promoted if, in such cases, the Government merges those agencies and departments thereby achieving efficiencies and economies of scale. These efficiency gains would allow the Government to sustain funding of the security, health and education agenda all of which are growth inducing as they build human capital.
• However, the privatization and transaction model more generally, with independent ad-hoc enterprise teams led by part-time chairpersons, staffed with non-dedicated resources from the Attorney General Chambers and Ministry of Finance, with the Development Bank of Jamaica (“DBJ”) as the Secretariat is simply not scalable. This model can handle one or two privatisations/public-private partnerships a year but cannot readily be scaled to handle, for example, twenty over four years.
• There is a great need to overhaul the mechanism by which privatisations, public-private partnerships and similar transactions are undertaken to achieve scale and speed.
• We therefore recommend increasing the number of Account Executives at the DBJ handling privatisations, public-private partnerships and transactional matters.
• Have dedicated resources at the Attorney General’s chambers and at the Ministry of Finance of sufficient authority and expertise who only work on privatisations, public-private partnerships and transactional matters.
• Set up and empower single, permanently staffed enterprise team to handle multiple privatisations and public-private partnership transactions.
• Outsource “Enterprise Teams” to for-profit firms staffed by permanent persons who compete for the mandate.
• Implement Public Sector Transformation pursuing gains in public sector efficiency, reducing duplication and achieving scale.
• Identify $30 billion of UDC/FCJ assets that can be sold for development purposes with proviso that the assets return to the government if full financing is not finalized by a certain period and if development does not commence within a specific period. The amount of $30 billion is not scientific. However the point is to engage in a transformational process of increasing the utilization of assets by selling a significant proportion of what is now dormant.
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• Ensure such divestment is broad-based and socially responsible. Use capital markets and undertake measures to ensure significant pension fund and segregated insurance fund participation in asset sales and privatisations so that the people of Jamaica have continued participation.
BUILD HUMAN CAPITAL• Human capital is too often an
undervalued component in the conversation on growth, yet it is one of the key drivers of economic growth.
• In its 2011 Jamaica Country Economic Memorandum: Unlocking Growth, the World Bank, noted that one of the main cause of low productivity is “Deficiencies in human capital and entrepreneurship due inter alia to quality deficiencies in education and training and high migration rates for tertiary graduates and skilled workers”.
• In 2013 69% of the labour force had no training.[STATIN 2013]. We need to focus on policies and strategies that nurture human capital development and provide education and skills training that match the needs of our economy.
Pursue Labour Market Reform • The EGC recommends timely
completion of the work of the Labour Market Reform Commission (LMRC) and implementation of the recommendations of the LMRC.
• The Government of Jamaica established a Labour Market Reform Commission in 2015 as part of the effort to strengthen the Jamaican economy, particularly through the creation of an enabling business environment while ensuring decent work for all. The LMRC is focused on five thematic areas, Education and Training; Productivity, Innovation and Technology; Labour Policies and Legislation; Social Protection; and Industrial Relations.
• Ensure the timely completion of the work of the five committees of the Commission and the implementation of the recommendations of the LMRC.
• Ensure educational and training programmes are aligned to labour market information and intelligence to arrest the mismatch between the competencies demanded by industry/employers and those supplied by the education and training system.
• Create a national repository of labour market information and intelligence.
• Create an inclusive mechanism to allow for the sharing of education and training information and intelligence by institutions.
• Ensure educational financing (loans, incentives and grants) to support labour market driven programmes aligned to the economic development and growth agenda.
• Increase access to training and certification especially in the areas of science, technology, engineering and mathematics.
• Upgrade and expand work based learning and apprenticeship programmes.
• Develop strategies to aggressively increase patenting, research and development, including the urgent modernization of the Patents Act of 1857, to support indigenous innovators, inventors and entrepreneurs.
• Establish a comprehensive and integrated training and capacity development programme for MSMEs.
• Develop a National Training Strategy.
• Undertake a review and revision of the National Apprenticeship System.
Implement a growth-oriented, open-door, immigration policy
• The EGC recommends that Jamaica implement a growth-oriented, open-door, immigration policy.
• Jamaica does not have enough qualified persons to meet in the short term its growth agenda objectives. In this dynamic and competitive global environment, Jamaica cannot afford to put on hold these objectives until it upgrades its workforce to meet these demands.
• As it pursues a focused national education and training programme, Jamaica needs to explore additional ways to meet its labour needs and upgrade its workforce.
• Many countries have skillfully used their immigration policies to manage their labour requirements in order to grow their economies – attract investments, transfer knowledge, increase professional and skills training and increase job opportunities.
• The presence and availability of certain immigrants could encourage new industries and companies to invest and set up business in Jamaica with the assurance of the availability of the requisite professionals and skills set required.
• A growth-oriented immigration policy would allow a greater number of immigrants with advanced education and skills to legally enter, work and stay in Jamaica.
• These immigrants would not be displacing Jamaica workers. They will in the short term fill gaps in our labour
market as they bring professional training and skills which are either limited in quantity or not available in Jamaica.
• Immigration reform should be part of the growth agenda. It is an immediate and powerful way to increase economic growth and innovation, create broader job opportunities and increase Jamaica’s competitiveness and attractiveness as an investment destination.
• Develop a targeted open door growth-oriented immigration policy to facilitate the entry into the country of persons who have the skills, education, work experience and financial resources to make an immediate economic contribution.
• Among other things, the policy should seek to (i) modify and expand the existing visa programs to facilitate the entry of experienced, talented and entrepreneurial foreigners to work and live in Jamaica for extended periods; (ii) make it easier for such persons to work in Jamaica without the need for ongoing renewal of work permits and in specific instances without a work permit; (iii) revamp the eligibility categories, the time required and the criteria for attaining permanent residence or citizenship for such persons; (iv) create a more welcoming and less bureaucratic experience for such persons at all ports of entry.
• Amend the various laws related to immigration and work permits including the Aliens Act, 1946 and the Foreign Nationals and Commonwealth Citizens (Employment) Act, 1964 to allow for a targeted growth-oriented open door immigration policy.
HARNESS THE POWER OF THE DIASPORA• The diaspora represents a very powerful
reservoir of capital, relationships, skills and expertise that remains largely untapped. Replicating and leveraging diaspora engagement models that have been successfully pioneered by India, Ireland, New Zealand, Australia and Chile among other countries would allow Jamaica to more constructively organize and harness the power of the diaspora for economic growth and social development.
• Jamaica has the second highest Diaspora population among all Caribbean islands (behind the Dominican Republic) with particularly large numbers of skilled emigrants among the ranks living abroad. Studies have found that the persistent cultural affinity and patriotism of the Diaspora can motivate individuals to contribute to
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the development of their home country.
• The Jamaican Diaspora is large (estimated: 3 million in the first-generation) and sent a record US$2.2 billion in remittances to the country in 2015, almost 16% of GDP and the largest source of foreign exchange in the island. In addition to remittances, the Diaspora has contributed significantly to tourism, philanthropy (primarily to education and health), overseas purchases of Jamaican exports, and supporting overseas organizations through food festivals, carnivals, and parades.
• The Diaspora can play a greater role in private and public investment, trade, knowledge transfer, and in providing mentorship and strategic guidance to local businesses and entrepreneurs. The most effective method used to facilitate Diaspora engagement in other countries has been the use of international networks as a critical mechanism to enable interaction and a connection between members of the Diaspora and individuals and companies in the home country.
• The EGC recommends the following diaspora engagement policies geared towards enabling and facilitating a greater commitment of diaspora resources and energy to the economic and social growth of Jamaica:
• Re-purpose the Jamaica Diaspora Foundation as “Global Connect Jamaica” as a Public-Private Partnership to facilitate and encourage the Jamaican Diaspora to invest in Jamaica. Global Connect Jamaica (“GloJam”) would be an international organization and network whose central purpose would be to (1) connect Jamaicans in the Diaspora, (2) promote “Brand Jamaica” globally, (3) contribute to Jamaica’s growth and development by attracting investment to Jamaica, and (4) “pair” leading entrepreneurs, executives and professionals in the Diaspora with local businesses and entrepreneurs in Jamaica seeking to expand. GloJam would have the Prime Minister as the Patron and be headed by a Board comprised of prominent Jamaicans both in the Diaspora and resident in Jamaica.
• Establish a special financing agency under GloJam to issue “Diaspora Bond” targeted at Jamaicans in the Diaspora and to mobilise diaspora resources for investment in Jamaica. This agency would be modeled on the Israel Bonds organization, a FINRA-regulated entity headquartered in New York, whose sole client is the state of Israel. Israel Bonds has 150+ employees in 20 offices, mostly in New York, Florida, and other cities with large Jewish populations and issues over US$1 billion in retail bonds (e.g., Jublilee Bonds and Bar Mitzvah
Bonds) at low interest rates. The initial purpose would be to use proceeds from the bonds solely to re-finance existing higher cost debt (to avoid growing the debt stock) and eventually to use this as a sustainable mechanism to raise lower-cost debt capital from the Diaspora. Proceeds from the refinancing savings would be used primarily to fund specific projects and not for recurring expenses.
• Amend the Immigration Act to facilitate the issuance of a special “Global Jamaican” Immigration Card for members of the Jamaican Diaspora. This is similar to what several countries have done for their Diaspora populations who no longer have their home country citizenship. All persons born in Jamaica or of Jamaican parentage or heritage would be eligible to hold the card and would provide all the benefits of Jamaican passport holders (except the right to vote), and allows the cardholders the right to stay for an extended period in Jamaica. The purpose would be to encourage the diaspora to return, get involved, and invest in Jamaica.
• Establish a “Fast Track/One Stop” coordinating agency of all the major government agencies to address all Diaspora and investor requests and initiatives, and to ensure. This coordinating agency would include representatives from JAMPRO; Administrator General Department; National Housing Trust; Companies Office of Jamaica; Jamaica Customs Agency; National Insurance Scheme; Passport, Immigration & Citizen Agency; National Land Agency; Planning institute of Jamaica; Registrar General Department; Tax Administration Jamaica; and the Trade Board. The entity would establish a 24-hour “hotline” to address investor concerns and requests and would be focused on reducing bureaucratic obstacles.
• Work with the Ministry of Foreign Affairs and Foreign Trade to more than double the number of Honorary Consuls from Jamaica worldwide, primarily in the US, UK and Canada. Honorary Consuls serve a dual role to both: (a) promote trade and investment with, and (b) safeguard Jamaicans living in the cities they represent. The first objective would be the most important and it would target cities in the UK, Canada, and the US which are not represented now (there are only 2 in Canada, 2 in the UK and 7 in the US). Other countries such as Brazil, Spain and France have over 200 Honorary-Consuls, who are really Investment Ambassadors. These Honorary Consuls do not have a cost as they are not paid. GloJam should target wealthy “friends of Jamaica” in the Diaspora or successful Jamaicans as Honorary Consuls.
CATALYSE THE IMPLEMENTATION OF STRATEGIC PROJECTS• Strategic projects are critically
important. As Jamaica’s experience has shown, by themselves these projects do not necessarily lead to economic growth at a national level. These projects can, however, transform towns and communities and increase competitiveness. There are currently underway a series of strategic projects primarily private sector driven or through public-private partnerships. The timely implementation of these projects is important to meeting the 5% growth target in 2020. Some of these projects are listed below.
• Realisation of the potential of the Caymanas Special Economic Zone and other Special Economic Zone projects
• Renewal and Redevelopment of Downtown Kingston
• BPO/Outsourcing Sector projects• Development of various Integrated
Resort Development Projects• Upgrading and expansion of Agro
Parks and agro-processing projects• Facilitate the implementation of
major tourism projects• Construction of the Montego Bay
bypass and other road projects• Water supply and distribution
projects• Renewable energy projects• Mining projects
IMPLEMENTATION OF GROWTH INITIATIVES
The EGC’s focus will be on a method of implementation that encourages the Government of Jamaica to enter into an action oriented Declaration of Intent (“Declaration”) with the EGC, private sector groups, unions, and civil society. This would underscore the Government’s commitment to the specific policies that fall under each Growth Initiative, consistent with the Terms of Reference of the EGC. This approach will provide for there to be a transparent process of monitoring and reporting on implementation, and for the Declaration to be a “living document”, updated on a periodic basis.
Success in this endeavour will require public engagement and interest. Evidence and experience suggest that what gets measured gets done. The EGC will play its role in keeping the public updated, consistent with its Terms of Reference and looks forward to continued consultation, feedback and dialogue as we work together as a society to improve our collective standard of living by achieving “5% growth in 4 years”.
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Hon. Michael Lee-Chin, O.J. Chairman, Economic Growth CouncilChairman, National Commercial Bank
Ambassador Dr. Nigel ClarkeVice Chairman, Economic Growth CouncilDeputy Chairman & CFO, Musson Group of Companies
Senator Kavan Gayle, O.D.
Representative from Jamaica Confederation of Trade Unions to the Economic Growth CouncilPresident of the Bustamante Industrial Trade Union
Phillip Gore, O.D. Founder & Executive Chairman of Gore Developments Limited.
Hon. Hugh C. Hart, O.J.Senior Partner, Hart, Muirhead & FattaFormer Minister of Mining, Energy and Tourism
Patrick Hylton, C.D. Group Managing Director, National Commercial Bank
Hon. Noel Hylton, O.J., C.D., J.P.
Noel Hylton and AssociatesFormer Chairman, President and CEO, Port Authority of Jamaica
Mrs. Paula Kerr-Jarrett Director, Barnett Limited
Mrs. Pat Ramsay, O.D. Cultural/Development Consultant
Adam Stewart, O.D.,C.D. Deputy Chairman and CEO, Sandals Resorts International
economicgrowthcouncil
For Further Information, please contact:Maureen Denton
Cell: 560 4751 Email: [email protected]
Executive DirectorEconomic Growth Council Secretariat
