Business View Caribbean - Sept. / Oct. 2014

%XVLQHVV 9LHZ ‡ &DULEEHDQ ² 6HSWHPEHU ‡ 2FWREHU -DPDLFD Talking Business: Francis Kennedy 30 minutes with the president of the Jamaica Chamber of Commerce BUSINESS VIEW: It seems a large part of what the chamber has been doing recently is promoting relationships between Jamaica and the U.S., particularly South Florida. Is that your target area? Or what is your agenda day-to-day? Francis Kennedy: The Jamaica Chamber of Commerce in the past had been very inward looking as far as the economy is concerned, because that is how our members were operating. A lot of our companies in Jamaica only exported to the traditional markets – the United States, Canada and the United Kingdom and Europe – and those are the countries that the country has had great relations with for many years, from before independence in 1962. However, what has happened is, in order for us to survive as a country, we need to export more. Wehaveabalanceof paymentsdeficit of about 2.9billion U.S. dollars. Our main foreign exchange earnings are remittances, tourism and traditional and non-traditional exports. Traditional exports are the bulk of this, like sugar and cocoa and coffee and that type of thing, and the non- traditional are processed foods and manufactured goods. However, that comes to about 5 billion U.S. dollars a year, but our import bill is between 6.5 and 7 billion a year, and we have a trade deficit of 2.9 billion. We have, over the years, been borrowing money to pay for this trade deficit on the international marketplace. We have run out of borrowing power. We have an overseas debt of about 130-140 percent of the gross national product, so therefore we can no longer continue to borrow. We entered into a program in March (2013), an IMF agreement, and obviously with the IMF agreement what you do have right now is fiscal consolidation. But for the first timewithan IMFagreement, we now also have a growth agenda. There are quarterly tests – IMF agreements are for four years, so we have 16 tests to go through in the four years. We’ve gone through two tests already and we passed themwith flying -DPDLFD 6HSWHPEHU ‡ 2FWREHU ² &DULEEHDQ ‡ %XVLQHVV 9LHZ colors – that is as of the end of June and the end of September 2013. Now, unlike previous agreements, we have agreed with the IMF that we must have a growth agenda and a growth agenda has been negotiated with the World Bank and the Inter-American Development Bank. Each one is for 500 million U.S. dollars over four years, each 125 million, so that’s 250 million U.S. dollars per year between the two of them. There have been negotiations going on, since the IMF agreement was signed in early April, with the multi-laterals, that is the World Bank, Caribbean Development Bank and the IADB. Because of this, for the last nine months, because of the fiscal consolidation that the government has been forced to take on – minimum capital expenditure, central treasury management, cut back a lot of the social intervention programs – the country has gone into a recession. And, it’s only in the September quarter that we had half of 1 percent growth, but we’re still in a recession and we continue in the recession now. The industries that are growing right now are mining and agriculture, but there are other industries that we have to get into. So, that’s the conditions that we are in now and the five or six things that we’re dealing with the World Bank and IADB on, is for them to provide grant funding for the master development plan for the redevelopment of the two major city areas so that we can get foreign