Elections are over and so the time for reconstruction faces the nation (not only the Government), and a concerted effort to survive and thrive is a prime objective of the private sector, and non-governmental organizations (NGOs) as well. There is a need for a wider understanding and rejection of mendicancy, and a realization of the fact that a pandemic affects the whole world, including our previous benefactors (whether countries or donor agencies).
I wish to bring to your attention the fact that financial enterprises cannot function over the long term without having real goods and services providers utilizing the cash to provide real production. To simplify, a loan to a potato farmer cannot be repaid if that farmer does not produce greater volumes at an ever increasing efficiency with each crop and earn foreign exchange if there is a surplus.
A financial institution may feel secure through liens on the land but is mistaken with that security unless it intend to grow potatoes, or build a housing scheme on prime agricultural property (a self-defeating enterprise). Do you remember that NCB tried farming solo papayas in Clarendon for export and failed?
Having said that, it requires a comprehensive set of initiatives and policies across the country and I will try to enunciate some of these (although the list is not exhaustive).
- The first step is to realize that there is a major crisis facing every citizen that cannot be solved by the avoidance of change. This awareness requires endless repetition.
- The accompanying reality is that many of the previous activities being undertaken are no longer viable. If there is no school location with large numbers then the source of livelihood of the gate vendor has vanished. This extends to persons who rely only on importation without a care for value-added.
- A small business that focuses on just turning over money without an ability to grow/expand markets to meet the needs of an expanding family is not necessarily defined as an entrepreneur.
- A medium or large business that refuses to change its offerings in the face of declining demand is not entrepreneurial. There is a product cycle that eventually leads to decline in sales and margins.
- To continue the buying and selling of commonly available or unbranded goods without significant differentiation in value-added or service is not a sustainable enterprise and will lose its capital whether it is equity or loans.
- A business that relies on incentives, tax concessions, and special favours that are not offered on a level playing field will not prove resilient to external or local shocks/threats of varying magnitudes.
- Not all persons have the ability to become successful entrepreneurs and the failure rate is much larger than the success, as it is in new product introduction.
- Not all civil servants are bureaucrats and a high proportion may be deprived entrepreneurs.
- In all the above there seems to be the need for an assessment of the nature and inclination of our work force in order to maximize the growth potential from the base upwards.
10.All of the above require relevant policies in order to allow all to flourish within their individual and collective abilities. Just as there is a need for Albert Einstein there is an equal need for skilled manufacturing employees and intermediate suppliers such as component providers for General Motors or Intel.
The policy must address a more equitable reward and complementary system that boosts production and productivity.
With all that said, it appears to me that the private sector, civil society, and individuals need to understand that an indebted country cannot continue to ask its Government to borrow more money to support a lifestyle to which it has become accustomed.
The private sector need to get up off their backsides and earn foreign exchange instead of bleating to the Bank of Jamaica (BOJ) to support their importation excesses. They need to manage better; make products for export; establish cooperative models/alliances to do more in the world markets; help to make the Jamaica Stock Exchange an attractive place for international investments and placements; create joint ventures with foreign companies to take advantage of access to and transportation to international destinations, and local assembly wherever possible.
The private sector need to think high-tech/digital/transformational rather than crying for assistance. The large companies need to create the channels for the small companies to expand their export reach. They also need to jointly explore and strategize non-traditional markets.
Stop manipulating the value of the dollar. Stop buying, and plan to earn those dollars. Initiatives for export, linking of luxury goods to earning FX revenues need to be considered not as a restriction but as a policy initiative.
The BOJ recently issued a statement (albeit weeks late) explaining the curious failure of businesses to take up US$13 million of a total US$20 million offered. The reasons given with regard to tourism were adequate and the truth is that the major earnings are sequestered in tax havens and never get here. Please note that the Dominican Republic faced similar problems and remedied most of the problems between the Main Directorate of Internal Taxes (DGII), and the Association of the Hotel and Tourism of the Dominican Republic (ASONAHORES) in a bold revenue and more equitable revision.
Secondly, many internationals may be buying Jamaican-sourced US$ to support their operations in other countries that still have foreign exchange restrictions. If that is so, then they need to relinquish their many tax concessions. If that is so, then there is a base opportunity for corruption.
The cruise shipping industry also needs an agreement that shares more of the economic value locally as this is also required to enhance sustainable development. The published arrivals can no longer be accounted for by manifest but must account for the number of passengers who disembark. This should receive some attention from CAPRI as they may be not be aware of the data collection inadequacies, or intentionally misleading pronouncements over the past decades. Please note that these numbers are neither from STATIN nor verified by them.
Civil society needs to truly embrace the tenets of social entrepreneurship. There is a growing facility through the use of the JSE for raising equity. There is money to be made out of doing the good and right things. These opportunities arise from the inability of the Government to stop the wastage and corruption inherent in certain social services areas.
These include prisons; places of safety; care centres for the aged and indigent; boarding schools; halfway houses; and many others. If the Government got real value for their input the efficiency and standards of service could improve and there would possibly be no need for annual borrowing to support the losses and the cost of commissions of inquiry to report on corruption and ordinary theft in those areas.
Opportunities abound for churches; relief agencies; special focus agencies; community organizations; healthcare professional caregivers; and competent persons currently stifling in non-productive bureaucratic jobs offering limited future benefits.
Service delivery essentials can be fully captured in an auditable performance contract, the termination for cause will not have to go to an industrial tribunal and large payments for non-performance would not be at the expense of the taxpayer.
The new Cabinet has potential for doing good work. The longer serving members cannot pretend to be insensitive to the urgent matters avoided; evaded; or neglected during their long and sometimes frustrating years of service. They therefore have their final opportunity to lead and support a more efficient legislative agenda.
The younger Cabinet ministers have no baggage and seem to have the logical ability to differentiate between old habits dating back to colonialism, and those new agendas that promise improvement and simplicity to the challenges ahead. They have the chance to allow logic to supersede old party myths, or currently irrelevant processes.
In the group of elected politicians now excluded from the Cabinet there are those who retain the wisdom born of experience. They are elder statesmen, and as obtains in Chinese culture they should be highly respected for their recall of situations. Recognizing that many of the “Young Turks” have little appreciation of history and geography and literary skills, the elders should now avail themselves as the Griots in order to bring them up to speed as required.
Public concerns about a few Cabinet members who remain under clouds, based on their previous actions and utterances, require that they have been given a short detention. But, as in school, continued misbehaviour will result in exclusion (being expelled). Their performance standards must be raised so as to ensure that they know that they are under public scrutiny.
The balancing act has to be one of the primary concerns of the prime minister. If he has chosen a talented team then it is clearly his responsibility to see that they are appropriately empowered and evaluate their performance as an integrated team.
That is your assignment, if you care to take it. This tape will self-destruct in 5 seconds. Good luck, Andrew.