Lee-Chin urges Jamaicans to save more and invest in assets
Chairman of the Economic Growth Council (EGC), Michael Lee-Chin, has made a passionate plea for Jamaicans to save and purchase more assets, warning that foreigners will sweep in as the economy begins to strengthen.
Lee-Chin, who was addressing the EGC’s is quarterly media briefing recently at Jamaica House in St Andrew, lamented that citizens consume a lot and do not save as much.
“We in Jamaica need to develop a culture of saving. We don’t save. We dis-save; we consume,” Lee-Chin, who is also chairman of the National Commercial Bank lamented.
He called for Jamaicans to delay gratification and curb consumption to enable more savings.
Asia, Lee-Chin said, has had a long-term period of sustainable growth for decades because citizens save. He said the saving rate on the continent is as high as 40 per cent of disposable income.
“So, it sets the stage for long-term growth. So, in Jamaica, we have to realise that a part of all I earn is mine to keep. I shouldn’t be spending all that I earn, I should be saving,” he advised.
Lee-Chin said the minimum that should be saved is 10 per cent of one’s take-home salary.
However, the EGC chairman said saving is just the first step Jamaicans should be employing as the economy begins to take off. He said nationals must also look at investing in stocks and in businesses.
“Own assets, own a home, pay down on something, pay down on a piece of land, join up in a partnership and do that. But we should be saving and owning assets,” he said.
Using Harlem in the United States as an example, Lee-Chin emphasised the importance of Jamaicans having an asset. He noted that in Harlem, residents who did not have assets were displaced, as investors swooped into the New York City community because of its strategic location.
“Because of Jamaica’s excellent location, no different from Harlem to Manhattan, no different from Jamaica to South America; and because Jamaica is being gentrified and because us in Jamaica, we are not historically asset owners, we will be displaced, prices will go up, and foreign investors will come in, buy up the assets, as they did Harlem,” he warned.
“So, if we don’t learn the lesson from Harlem, we are going to be displaced into the sea and we will be continuously poor,” the billionaire businessman asserted.
Lee-Chin noted that that country was experiencing unprecedented high levels of business and consumer confidence, but lamented that it was mostly foreign investors who have been making use of the opportunities the improving economic conditions have provided.
“We are in the best position to take advantage of it – we see it happening. The next best group to see it, feel it, hear it would be our relatives abroad, because they have a connection to us. The last best group would be your international global investors,” he said.
“Given the confidence, we should be the ones jumping in first and investing. The reality is, that’s not the case. The foreigners are the ones leading the way. They see what we don’t see that’s right in front of us. It’s backward,” he argued.
The EGC chairman said there was an urgent need to correct that “backwardness” and take advantage of the opportunities, which now exist in the economy, touting the climate as “perfect” for investing.