By Marjorie A. Stair, Western Bureau Chief
Many of the farms, if you see any, are run down and in poor condition. - File
"I have read that our country is stabilising. That may be true, but we have no jobs. We can't send our children to school. Maybe stabilising is a good thing for the countries we pay debt to, but here life is getting harder"
- Zambian woman - from the 1999 OXFAM Poverty Report on Structural Adjustment
Dr. Omar Davies, Honourable Minister of Finance, is proud of the economic progress made under his watch, and I guess he should be. The rate of inflation is down, the foreign exchange rate is relatively stable, interest rates have decreased, NIR has increased, there has been reduction of the fiscal deficit and there has been some semblance of growth after many years of decline.
The 2000 Survey of Living Conditions speaks of the continuing disparity between the rich and the poor and the problems of inequity and inequality that continues to plague the country, however.
In the year 2000, the poorest quintile in Jamaica had only a 6.67 per cent share of national consumption, as compared to the wealthiest that had a 46 per cent share. Poverty increased from 16.9 per cent in 1999 to 18.7 per cent in 2000, down from a high of 28.4 per cent in 1991. Poverty in rural areas increased from 22 per cent in 1999 to 25.14 per cent in 2000. The report on the 2000 survey states:
"Regardless of the level, however, some features of the poor have remained penetrating and unassailable; persons in the rural areas are almost twice as likely as their urban counterpart to be poor, the poor have lower levels of education, their children participate largely at the lower levels of the education system, their households are larger and they are more likely to share basic housing amenities."
Rural towns are overcrowded, with the streets taken over by vendors and, areas adjacent to towns taken over by squatters. Rural districts are pictures of severe decline. The roads are in deplorable condition. Most shops are closed except the one or two selling 'Lucky Five', 'Cash Pot', or containing gambling machines. You might see a Go-Go club or some form of dance hall as these provide good cover for the commercial sex trade and the narcotic drugs trade. In the poorest of areas, like in the Milk River area, you see bags of coal along the roadside as the only sign of economic activity. Many of the farms, if you see any, are run down and in poor condition. There are lots of idle lands and remnants of better farming days.
There is now a proliferation of signs offering land or lots for sale in Southern St Elizabeth. Farming is still taking place in the area that usually supplies Jamaica with escallion, thyme, carrots, onions, tomatoes, sweet peppers and melons, but, obviously not at previous levels. My information is that some farmers in Southern St Elizabeth, as well as other farming areas, have shifted their efforts from selling their own produce to selling imported produce.
There is yet no other feasible economic alternative to farming in rural Jamaica. The bauxite industry has contracted; community tourism is yet to take off in any meaningful way and the tourism industry itself is in problems. The proposals, by rural Members of Parliament and wanna-be rural MP's, seeking to be elected, to build factories and skill training centres might sound good on paper but to what end if there is no market to take the produce of the factories, no raw material to facilitate production and no surplus income available to rural people to purchase the output or services of these skilled workers.
For Jamaica to achieve meaningful economic growth, investment must take place. Jamaicans or foreigners must invest capital in the Jamaican economy, creating jobs; thereby creating surplus income that will create demand for increased goods and services and, therefore, further investment and growth. The huge informal economy, driven primarily by the trading of narcotic drugs, has masked and reduced the more devastating effects of the huge fall out in the formal economy, but has brought its own social problems, such as increasing crime and violence that are anti-investment. Investment requires viable markets and capital to facilitate production. Agricultural production cannot be increased in the short term, in response to increased demand for goods and services, and requires a minimum of a year, with tree crop and livestock enterprises requiring longer periods, as much as 5 to 7 years. Short-term crops that can respond more quickly have faced increasing competition from dumped US imports in recent years. Agriculture also requires significant investment in research and development to improve the capability of the sector to exploit new technologies and innovations. The lack of investment in R & D, especially over the past three decades, has limited the country's ability to exploit these technologies that could have made the sector more efficient and more competitive in the face of globalisation and the new international trading agreements.
Any reduction in rural poverty in the short term must mean increased agricultural investment. Increased agricultural investment is constrained by the following to which solutions must be found by those who now govern, or those who are now seeking to govern the country.
1. Many Jamaican farmers are bankrupt. They have no capital to invest and cannot obtain credit because of previous indebtedness or loss of assets to financial institutions that had provided them with credit. The sugar cane farmers are a good example and there will be no planting of sugar cane until a solution is found to this intractable problem. Are we going to import sugar cane to feed our modernised and upgraded sugar factories?
2. Former markets have disappeared and existing ones contracted because of increased competition from dumped and/or cheap imports
3. Labour is scarce as rural labour migrates to urban areas, or overseas in search of employment. There is also competition from the narcotic drugs trade that offer supposedly more attractive employment opportunities.
4. Praedial larceny has increased and there is no easy or ready solution to this as the security forces are already hard pressed in dealing with more violent crimes and making futile attempts to stem the narcotic drugs trade.
So, we have achieved stability, but at the expense of economic growth and the poor, especially the rural poor and the productive sector. The Jamaican taxpayer now faces a horrendous debt burden that would have been more palatable if the borrowed capital had been invested in the productive sector. A lot of it has instead been used to bail our the short-sighted financial sector which luxuriated in a mirage of wealth in the 1990's, fuelled by the monetary policies of the government in the 1980's and early 1990's, creating great edifices with their super profits before the eventful collapse. Wealth has been transferred from the poor to the rich and inequity and inequality continues to plague the country, with the gap between the rich and poor increasing instead of decreasing.
