Among Bruce Golding’s more ambitious plans for Jamaica, after being sworn in as prime minister on Tuesday, is to add the island to the list of the world’s offshore financial centres.
“There are other islands in the Caribbean that have done very well in their offshore activities and we believe that it is an area that Jamaica can secure benefits from,” said Mr Golding in an interview with the Financial Times.
Mr Golding, who has promised to reverse Jamaica’s fortunes after 18 years under the previous government failed to solve problems of slow growth and rising crime, admits that 10 or 15 years ago it he would “not have been prepared to consider” such a plan.
But now, he said, “Regulatory mechanisms are sufficiently well developed to give us the kind of protection that we want in order to ensure that we are not taken advantage of.”
He added: “Importantly, it would be a critical engine to drive the redevelopment of the city of Kingston.” The capital is dogged by rising crime.
Mr Golding identified more important short-term measures that he hoped would put an end to Jamaica’s “anaemic” growth, pointing out that last year’s growth of 2.5 per cent, the highest in 14 years, was “clearly not sufficient”.
“During the 1990s, which saw the longest sustained period of global economic growth, Jamaica did not grow. We need to find out why,” said Mr Golding.
While committing himself to maintaining a tight fiscal policy and low inflation – which he hoped to achieve by granting full independence to the central bank – Mr Golding said that a greater focus needed to be put on investment.
“There are investments and there are investments,” he said, pointing out that while Jamaica has received $4bn (€2.8bn, £2bn) in foreign direct investment from 1995 to 2005, growth failed to take off and unemployment remained high. “We need to find the kind of investments that can put Jamaicans to work.”
Mr Golding highlighted three priority areas: tackling violence and crime, reducing red tape, and educating the workforce. On crime, which “will not be solved overnight”, Mr Golding admitted that law enforcement needed to be “much better”, but he emphasised that job creation would play a big part.
“The most important thing is trying to restore hope, so that the people of Jamaica can find the energy that they didn’t think they had – to make it seem that things are getting better, rather than leave them feeling that they are facing a blank wall of hopelessness and despair.”
The other factor holding back growth is Jamaica’s heavy debt burden with a value greater than 130 per cent of gross domestic product.
“We can’t continue to borrow our way out of problems, as that just leads to a whole lot more problems,” said Mr Golding, who aims to reduce the debt burden to 95 per cent of GDP over the next five years.
“It’s a tall challenge, but it’s doable,” he said. “These times call for tough decisions.”
