Sun | Sep 24, 2017

'From Poverty to Prosperity: the road map'

Published:Friday | January 20, 2017 | 1:00 AMWendel Ivey
Due to International Monetary Fund guidelines, policy continuation had some success with the country's macroeconomic variables trending in the right direction.

The following is a contribution ahead of the Jamaica Stock Exchange (JSE) conference set for The Jamaica Pegasus hotel, New Kingston, between January 24 and 26.

Transitioning from poverty to prosperity might be more easily said than done for Jamaica. On average, 38.8 per cent of the population suffers from multidimensional poverty, which includes deprivations in education, health, housing, and living standards. The Government has placed emphasis on growth acceleration with the establishment of the Economic Growth Council as a remedy. However, an uneven distribution of income does not guarantee that earnings from economic growth are translated into poverty reduction. An emphasis on job creation rather than wealth creation for the nation might only guarantee survival, but not necessarily prosperity for all.

Policy continuation has not been a priority since the early 1970s. Political leaders often view policies as election-winning strategies which often waste resources, undermine sound economic policy, and hinder development. Recently, due to the guidelines of the International Monetary Fund, policy continuation had some success which brightened the horizon for Jamaica, as macroeconomic variables were trending in the right direction. For 2017 and beyond, there should be some form of long-term nation-building strategy with policy continuation as a priority.

MINIMAL CONTROL OVER CORRUPTION

Jamaica has been hampered by rent-seeking abuses, political oppositions, and by the failure to prosecute corrupt public officials. Data illustrate that from the early 1990s, Jamaica's control over corruption has been minimal. As a result, the true potential for sustainable growth and development is being impeded as Mo (2001) estimated that a one per cent increase in corruption results in a 0.72 per cent reduction in growth. Jamaica can also learn a useful lesson from the African nation of Mauritius. Mauritius is similar to Jamaica in many ways, but has a greater control over corruption, which has assisted them with being the fastest-growing wealth market in Africa and one of the five fastest-growing wealth markets worldwide.

Business process outsourcing is a good strategy that has provided a food basket for many Jamaicans. However, a shift is needed from low-skilled to more sophisticated jobs which require constant innovation and critical thinking. New innovations will provide more efficient ways of conducting long-standing processes which have the potential to increase the standard of living for all.

Government effort is critical, but it is insufficient by itself in determining the quality of life that we experience. Jamaica is our country, therefore, we should all find our talents or harness certain skills so that we can play our individual roles in advancing the welfare of the country and, by extension, our own lives.