Jolting Jamaica with an external shock

Ronald Mason, Contributor

Jamaica is sputtering along. We are neither growing nor earning our way. We are taxed to the maximum by any objective criterion. In addition, the world is not rushing to provide us with the direct investment or preferential loans we formerly had. This is so for myriad reasons.

Energy is a prohibitive cost totally dependent on the good graces of an unstable oil source. There's low productivity in all sectors. We have to spend J$22.5 billion per annum on welfare support payments. A large, though reduced food import bill. Unemployment among the young (14-24) tops 37 per cent. This is roughly some 65,000 youth. What's worse, a larger cohort is unemployable.

We have experienced, in the region, a series of catastrophic events in Haiti, a local brush by Hurricane Sandy, and there have been recent tremors in Puerto Rico and the Dominican Republic. It is well known that Jamaica sits on the same earthquake fault as Haiti. When will it be our time to have an earthquake, the last major one being in 1907. We are due. This forces us to consider and plan for the probability of an external shock to the country.

The shock could come in the form of a Gilbert-type hurricane, a devastating earthquake, or both. Do we have financial reserves to begin to address needs post-external shock? Do we have a governance structure designed to deal with the inevitable price rises of scarce commodities in the immediate short term? Add hunger to the misery index of no light, no water, no roads, no gasolene or cooking gas, to list a few, added to the 65,000-plus unemployed youth.

The governance structure is currently dependent on the benevolence of others. The 'others' include the IMF, with some US$71 million drawn down upon passing the most recent test. Big deal. Our oil import bill is US$2.4 billion annually. Recall our begging for advance on the fees payable by the telecommunication companies just to limp to the end of the financial year 2013-2014. We are not in good shape and capable of coping.

There is, however, a silver lining to this potential dark cloud.

This will provide us with the opportunity to have a national debate and conclude by repudiating some external debt. The near J$2-trillion debt cannot be serviced in this eventuality. The credit grade offered by Standard & Poor's or Moody's or Fitch will not seem so significant. All of us will be mobilised to 'break rock stone' to build roads, paved with concrete and not imported asphalt. All the cement would be locally sourced. The roads would have more promise of durability and benefit from the national fervour for reconstruction.

The schools, hospitals, government buildings and places not covered by insurance will now be built in accord with the new building code which, at present, languishes for no known reason. The electricity-generation capacity will be rebuilt without all the tomfoolery that passes for efficient planning now. Ah, how wonderful that we will be forced to focus on the immediate need by the true 'God'. There will be the exposure of the theory that Jamaica has enough water-storage capacity in the form of rivers and that there is enough water on the north coast, and that the redistribution problem is greater for the population on the south coast. NWC would be forced to move water by the most efficient means, solar pumps to the storage facilities in the south. Get it done.

STOP THE EXCUSES

We would stop the excuses and mobilise the diaspora to help fund reconstruction. We have long known of bonds sold by countries like Israel to their nationals who do not live at home. Go further:

List the JPS, Port Authority, Montego Freeport on the international stock exchange. Raise capital at manageable rates.

There will be greater employment. Agriculture would no longer be just dirty, but also vital. We would value our neighbours as we will sink solely or collectively survive. We would become our brother's keepers and place value on human lives and compatible interaction with teamwork.

No one can wish for the catastrophic external shock to a small, vulnerable nation, especially one such as ours which has leaders almost incapable of thinking beyond an annual time frame. Hopefully, it does not become necessary in the immediate future, but if it does, use the silver-lining opportunity wisely.

Ronald Mason is an immigration attorney, Supreme Court mediator, and talk-show host. Email feedback to columns@gleanerjm.com and nationsagenda@gmail.com.