JSE capital markets conference - IMF rep: Glimmers of hope for Jamaica, but ...
Published:Friday | January 28, 2011 | 12:00 AM
Using the analogy of an orchestra creating music, Gene Leon, International Monetary Fund resident representative to Jamaica, is arguing that the country's path to growth lies in reducing levels of uncertainty and building confidence in the private sector.
"Environments that minimise uncertainty matter," said a speech prepared by Leon.
He was scheduled to present at the sixth regional conference on investment and the capital market being put on by the Jamaica Stock Exchange, but was unable to deliver the speech himself due to unforeseen circumstances, leaving senior economist in the IMF country office, Rasheeda Smith, to deputise.
"Imagine how chaotic a symphony would be if, having practised on an agreed set of score sheets, the conductor changes course during the concert itself and gives different instructions," said the IMF representative.
"Some players or sections would stop, some would continue with what was agreed during practice, and others would follow the new instructions from the conductor."
But with a clear articulated vision, transparency, resolute implementation, and an environ-ment that minimises uncertainty for all stakeholders, a more effective outcome is likely, the official said.
To build this confidence, according to Leon, the country has to look for quick gains.
In this regard, he said, the government must subscribe to implementation of sound macro-economics policies, enhancing regulation, governance, and transparency.
Invest in physical, social, and human-capital infrastructure while paying attention to building capacity, addressing poverty, and poor social condition among others.
Change is also required on the side of the private sector.
"The private sector, financial and non-financial, needs to buy in to a cultural reorientation," said the IMF rep.
The household, as well as multilateral agencies like his own, are also pillars that will need to contribute in improving efficiency and support a sustained economic growth for the country, Leon said.
To jump-start growth, he outlined the need for increased investment by the private sector or more spending from the government, to demonstrate confidence about the future.
Either one must be done in an environment where there is a recognition of current realities such as high debt levels, declining output from major trading partner, high cost, and lack of competitiveness.
Leon points to glimmers of hope with ongoing reforms, but said Jamaica is still a far way from full recovery and is lagging relative to other countries.