Editorial: The embrace of Byles and Lee-Chin
Despite the obvious enthusiasm that Michael Lee-Chin is already bringing to his job as the Government's growth czar, the billionaire entrepreneur has underlined two factors that are necessary if he is to deliver on his target of expanding GDP by at least five per cent a year from 2020 onwards.
One of his declarations was explicit: The success of effort rests on achieving national consensus. "It's not going to happen if every stakeholder doesn't make a pledge (of commitment to the effort)," Mr Lee-Chin told this newspaper.
Mr Lee-Chin's allusion to the other requirement was implicit. He endorsed Jamaica's International Monetary Fund (IMF)-supported economic project for the fiscal discipline it has forced on the Government. "So now we have learnt this, it is not OK not to meet targets, as there are penalties, and that's the reason we have passed 12 consecutive IMF tests," he said.
Lest Mr Lee-Chin be misunderstood, achieving those quarterly targets under Jamaica's IMF programme - including the especially tough one of a primary balance of 7.5 per cent of GDP - was not some experiment in delivering economic hurt on people, with the pain of failure being the stringencies of an external examiner. Indeed, what has been achieved under the IMF is sine qua non for reaching the target that Mr Lee-Chin has set himself.
Five years ago, Jamaica's debt was racing towards 150 per cent of the national output of goods and services; the Government's deficit was hovering at near six per cent of GDP; servicing that debt consumed well over 40 per cent of the Government's Budget; the current account deficit was around 13 per cent of GDP; and investor confidence towards Jamaica, after 40 years of bad economic policies, was like riding a roller coaster without having any sense of its peaks and valleys.
Today, that national debt is around 125 per cent of GDP; the Budget is nearly balanced; the current account deficit is low single digit; and inflation is at its lowest in nearly half a century. In other words, Jamaica is enjoying something close to macroeconomic stability and a greater sense of policy certainty, or the kind of environment where innovators are more likely to risk their capital.
However, Jamaica is not yet out of the woods. There are significant elements of the reform that are yet to be undertaken and fiscal discipline to be maintained if the country is to cement the stability thus far achieved. In that regard, we are heartened by the new administration's commitment to maintaining the current IMF programme, but warn that its end in a year's time should not be a signal for the abandonment of discipline and letting loose the fiscal spigot.
On Mr Lee-Chin's call for stakeholder support for his efforts, we endorse the appeal and hope that it is delivered. At the very least, no one should put obstacles in his way, attempt to politicise his efforts, or subject him to the calumnies that were poured on Richard Byles, the chairman of the Economic Programme Oversight Committee, for simply declaring the facts of Jamaica's performance under the IMF agreement and making clear that the environment was improving for investment.
In many respects, the ventures of Michael Lee-Chin and Richard Byles are different sides of the same coin. Perforce, Mr Byles' had to be first in the mould.