Jamaica: The Greece of the Western Hemisphere? Really?

Posted: January 8, 2013 in Politics/Current affairs
Tags: , , , , , ,

Well, it’s time to shake off this blogging lethargy. For a while all the various issues bombarding Jamaica I was a bit unsure as to what would inspire me to wade back into the blogosphere. However, comments from a major newspaper in our popular neighbour to the North have ended my blogging slumber. For those who haven’t heard it the Chicago Tribune in one of its Op-Ed pieces has declared Jamaica “The Greece of the Western Hemisphere” and the true cautionary tale regarding debt versus the Greek tragedy that has taken up much more of the public consciousness.

The following two paragraphs represent the crux of the article:

The Caribbean nation actually is in worse financial shape than Greece: Jamaica has more debt in relation to the size of its economy than any other country. It pays more in interest than any other country. It has tried to restructure its loans to stretch them out over more years, at lower interest rates, with no success. Such a move would be risky for its already nervous lenders. So Jamaica is trying to wangle a bailout from a skeptical International Monetary Fund. Another deadline for a potential deal just came and went last week, though negotiations continue.

Jamaica is caught in a debt trap. More than half of its government spending goes to service its loans. The country can spend barely 20 percent of its budget for desperately needed health and education programs. Its infrastructure is faltering. It lacks resources to fight crime. It has little margin to recover from natural disasters such as Hurricane Sandy

I must confess my initial reaction to this article was not a constructive one. The first thought I had was quite defensive “it’s quite ironic that a newspaper from the city that could be styled ‘the Jamaica of the US’ due to its high levels of murder and violent crimes is commenting on us so strongly.” This reaction however true I feel is not where the discussion needs to go so I will scold myself no worries. The message here is far more important to pay attention to than the messenger.

Are we really the Greece of the Western Hemisphere? The mere fact that we cannot reject this assertion flatly is enough to highlight the dire state of the Jamaican Economy. And the description of the Jamaican economy proffered in the article though decidedly sensationally flavoured is also patently correct. Despite the tone which may offend some and may evoke hallelujahs from others, the message is clear and simple the economy is really in a bad place.

Several thoughts come to mind after this resignation to the scope of our misery:

• When will the international financial community realise that these debt trapped countries they label as “Middle Income Countries” will need debt relief both for their personal survival and that of the entire international financial system?

• When will our leaders and indeed we the people realise that even more austerity, better yet austerity with an actual purpose versus token “belt tightening” is needed for us to slowly wriggle out of this plight. And these drastic actions must be owned by us with or without the prompting of the big bad IMF.

• The funniest thought I had after reading the article which again highlights some endemic folly in our politics – I AM SURE THIS ARTICLE WILL RESONATE WITH OUR LEADERS FAR MORE THAN THE COUNTLESS ARTICLES WRITTEN HERE IN JA. WHY? CAU WHEN FOREIGNER TALK WI LISTEN!!!!

So anyway after getting over my initial disdain for the messenger, the fundamental message that years and years of fiscal irresponsibility and borrowing that we have fairly little tangible evidence of its utility has put us where we are finds favour with me. Even further the idea put forward, that has also been accepted by all that the public sector wage bill is too large and that there must be tax and pension reform also finds favour with me.

The major disagreement myself and the authors of this Chicago tribune article have is that of the inherent “goodness” of the IMF and its principles and policies both past and present but trust me when I say that could be a series of blogs versus a single comment so save that for the future.

What is clear is that Jamaica is in a tight spot and in dire need of visionary leadership coupled with a united society. Sad to say little evidence of either abounds. I pray this reality can change and sooner rather than later.

Blessings.

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Comments
  1. Kemoy Lindsay says:

    i share ur skepticism abt the IMF’s policies and would go further to discredit their true intentions as it relates to development for the developing. They enjoy this system of peonage and perpetual indebtedness and constantly impose anachronistic policies that worsen countries in the long run than help them. History is the truest speaker, only one (developing) country has seen consistent growth after taking an IMF loan and that is N.Korea after the 1997-98 economic crisis and that was due partly to the support it had around it from the Asian Tigers and primarily china. if the IMF really wanted to see development, indeed as you said, debt relief is the only viable option, for most countries will never be able to fully service their debts.

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