Noel Thompson, Gleaner Writer
Opposition Leader, Bruce Golding.
THE JAMAICAN economy is unable to generate the resources necessary to address the urgent situation, which threatens the country's upward mobility, says Leader of the Opposition, Bruce Golding. Mr. Golding launched a scathing attack on what he describes as government's tardiness to competently manage the country's economy.
While addressing a large
gathering at the Central Hall Conference Centre in Westminster, London on Friday night, Mr. Golding did not hesitate to criticise the government's handling of the economy. The address was the climax of his United Kingdom tour, which was sponsored by the Jamaica National Building Society billed 'Outlook for the Future.'
"The 1990s experienced the longest period of sustained economic growth that the world had seen in over 50 years. The entire world grew at an average rate of 3.4 per cent yearly, while developing countries grew by 5.7 per cent. It was the first time in history that developing countries were
enjoying a greater share of that improvement in the world
economy," Golding said.
MISSED OPPORTUNITIES
Jamaica, a developing country, he said, did not grow by 5.7 per cent; instead, its economy grew by 3.3 per cent for an entire 10-year period. "That represents one of the greatest missed opportunities that Jamaica has ever seen. In one year alone, inflation was allowed to increase by 103 per cent and that created an economic crisis to which the government had to respond," he noted.
"We are in a position where the total debt of the country now stands at over $800 billion, compared to $38 billion when the government took up office in 1989. This is wearing down heavily on us. So much of the country's resources are being used to service debts that there is not sufficient money to provide the various ministries to undertake their responsibilities effectively," Golding said.
"In fairness to the government, the situation has been
corrected in some respects. Inflation has been brought down to single digits for six consecutive years. Finance Minister Omar Davies has held very tightly on expenditure, which is why there is a shortfall in addressing other aspects of the budget," he admitted.
He said we could not keep
borrowing each year, as it meant that we were mortgaging the future of our generation to come.
PRIVATE SECTOR DEPRIVED
He continued: "We are depriving the private sector of the funds it needs in order to get investments going because the Government is borrowing the most of the money and leaving very little for the
private sector."
Reflecting on the situation
15 years ago, Golding said Government was borrowing 25 per cent of the money in the
commercial banking sector, with the remaining 75 per cent being used up by the private sector.
"Government's borrowing appetite has become like an addiction, which is preventing the economy from growing. So long as Government continues to borrow, it has to pay a rate to ensure that it gets the money. Therefore, interest rates have to be high and as long as the rates are high, the inclination to invest will not be there.
Asked what a JLP government would do to rid the country of its chronic economic debt and how it would then move the economy forward, Golding proposed a number of solutions: "Firstly, you have to put a cap on the debt." He suggested that the country's debt limit should be enshrined in the constitution. That would force a government to make some tough decisions because government would not have the option of simply
borrowing more money.
"You are going to have to grow your economy in such a way that over time, as more investments, output and jobs are created, more revenues will be collected and the economy will grow," he said. He admitted that this would be a slow process, but expressed
confidence that it would become easier as the years went by.
CURTAIL CRIME
He said, however, that in order to have economic stability, crime would have to be radically curtailed in Jamaica. He said the JLP would give a commitment to prioritise crime as its main focus for the first three years.
Mr. Golding said it was not
necessary to have a contingent of 3,500 personnel in the Jamaica Defence Force, as we were not fighting external enemies. "One of the commitments we have made is to reduce the size of the army to 1,000, as this would be sufficient to provide the country with the kind of emergency response needed in time of disaster. It would also provide the level of force needed to support the police in extraordinary circumstances. This would enable government
to divert those resources to
strengthen the police force.
