Two points from Holness' 10-point plan
THE EDITOR, Sir:
Recently, Andrew Holness released a 10-point plan to convince Jamaicans that he is the right man to lead the country. Although these plans are not spectacular, two are worth discussing. Of particular interest are his proposals to create a special council of investment ambassadors and a Ministry of Economic Growth and Job Creation. The issue with the former proposal is that Jamaica's missions abroad are already promoting the nation as an investment destination, so the position of Holness may be interpreted as a duplication of those efforts.
There is nothing wrong with seeking to make existing programmes more efficient, but attracting foreign direct investment is not Jamaica's problem. At the crux of the matter is the low absorptive capacity of the economy which prevents the retention of foreign investments. Without improvements in labour productivity or the creation of world-class services, the economy will never be able to retain foreign investments. Therefore, any investment policy being pursued must aim to facilitate the creation of innovative Jamaican businesses that are able to provide services at the highest level. For example, the business acumen of those in the diaspora could be utilised by creating a Beachhead programme. These Beachheads will be required to mentor Jamaica entrepreneurs seeking to conduct business abroad. The benefit of such a programme is that it gives local businesses a greater understanding of foreign markets, thus enabling them to grow faster.
Pursuing foreign investment is not a bad policy, but this is the time for policymakers to embrace the internationalisation of Jamaican firms. It does not matter how attractive the country is to foreign investors, if we do not create firms that can produce first-class services, growth will not be sustainable.
Holness is correct to want to attract foreign investment, but if he is serious about creating dynamic firms, he must supplement his improved ambassador's programme with the Beachhead initiative. Additionally, Holness must become more articulate in expressing his desire to create a Ministry of Economic Growth and Job Creation, or else it will be seen as another layer of bureaucracy.
MINISTRY OF BUSINESS
Many developed countries now have a Ministry of Business, Innovation and Employment. This ministry is responsible for crafting pro-market laws and policies related to innovation. For example, South Korea's Growth Ministry usually fosters partnerships between businesses and foreign entities to facilitate the transfer of knowledge to Korea organisations. In addition, labour is usually a component of growth ministries, because productivity is crucial to GDP growth. However, in Jamaica, the Ministry of Labour focuses mainly on the administration of welfare and industrial disputes, while lip service is paid to productivity.
So, in reality, when Holness says that he wants a Growth Ministry, he is really proposing the reorganisation of the functions of some ministries and possibly a merger of the Ministries of Labour and Investment. If Holness wants to be the next prime minister, he should become more adept at expressing his ideas. Unlike the present administration, the Jamaica Labour Party will not win an election on rhetoric.