Jamaica's economic development. From slavery to economic independence


Pre-University Paper, 2001
37 Pages
Anonymous

Free online reading

Table of Contents

1. Introduction
1.1 Map
1.2 Geography and Climate
1.2.1 Geography
1.2.2 The Climate
1.3 People of Jamaica
1.3.1 Population
1.3.2 Population Growth and the National Population Policy
1.3.3 Ethnic groups
1.4 Political System
1.4.1 Constitutional monarchy
1.4.2 The Constitution
1.4.3 Political Dynamics
1.5 Historical Settings

2. Current Macroeconomic Situation
2.1 GDP & General Policy Framework
2.1.1. Unemployment/Underemployment
2.1.2 The Bank of Jamaica and its Monetary Policy
2.1.3 Exchange Rate
2.1.4 Structural Policies CARICOM AND CET
2.1.5 Debt Management Policies
2.2 WTO and WIPO
2.3 Aid

3. The Economy
3.1 General Economic Information
3.1.1 Growth and Structure of the Economy
3.2 Economic Sectors
3.2.1 Mining
3.2.2 Agriculture
3.2.3 Manufacturing
3.2.4 Construction
3.3 Services
3.3.1 Tourism
3.3.2 Banking, Financial Services
3.3.2.1 Commercial Banks
3.3.2.2 Life Insurance
3.4 Stock Exchange

4. Conclusion
4.1 Major Problems
4.2 Future Perspectives

Appendix

Census Table of the last 150 Years
Map of CARICOM Members
Flag of Jamaica

Sources

1. Introduction

Before the Spaniards occupied Jamaica in the early sixteenth century, the island was inhabited by the Arawak Indians, who called it Xaymaca, meaning "land of wood and springs." Lying on the trade routes between the Old and New Worlds, Jamaica served variously for centuries as a way station for Spanish galleons, a market for slaves and goods from many countries, and a prize for the Spaniards, the British, buccaneers, and entrepreneurs. By far the largest of the English-speaking islands in size and population, independent Jamaica has played a leading role within the Commonwealth Caribbean and has been active in international organizations.

Jamaica's story is one of independence that began in the seventeenth century with the Maroons, runaway slaves who resisted the British colonizers by carrying out hit-and-run attacks from the interior. Their 7,000 descendants in the Cockpit Country have symbolized the fervent, sometimes belligerent, love of freedom that is ingrained in the Jamaican people as a result of both their British tutelage and their history of slavery. Independence came quietly, however, without a revolutionary struggle, apparently reflecting the lasting imprint of the British parliamentary legacy on Jamaican society.

As I have spent one year in Jamaica, working on a Third World Project of the Council on International Educational Exchange it was an easy decision for me to choose Jamaica.

The main target of this country report is to show the economic development of Jamaica

- from slavery to (economic) independence - and its macro economic situation.

1.1 Map

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1.2 Geography and Climate

1.2.1 Geography

The geographic location is a very important point for Jamaica because tourism which depends on the environment is a main target of its economy. Jamaica lies 145 kilometers south of Cuba and 160 kilometers west of Haiti. Its capital city, Kingston, is about 920 kilometers southeast of Miami. At its greatest extent, Jamaica is 235 kilometers long, and it varies between 35 and 82 kilometers wide. With an area of 10,911 square kilometers, Jamaica is the largest island of the Commonwealth Caribbean and the third largest of the Greater Antilles, after Cuba and Hispaniola (the island containing the Dominican Republic and Haiti).1 The Pedro Banks, an area of shallow seas extending generally east to west for over 160 kilometers, lie southwest of Jamaica. A cluster of cays associated with the banks. To the southeast lie the Morant Cays, fifty-one kilometers from Morant Point, the easternmost point of Jamaica.

Although most of Jamaica's native vegetation has been stripped in order to make room for cultivation, some areas have been left virtually undisturbed since the time of Columbus. Indigenous vegetation can be found along the northern coast from Rio Bueno to Discovery Bay, in the highest parts of the Blue Mountains, and in the heart of the Cockpit Country.2

The highest area is that of the Blue Mountains (where the famous coffee comes from). These eastern mountains are formed by a central ridge of metamorphic rock running northwest to southeast from which many long spurs jut to the north and south. For a distance of over 3 kilometers, the crest of the ridge exceeds 1,800 meters. The highest point is Blue Mountain Peak at 2,256 meters. To the north of the Blue Mountains lies the strongly tilted limestone plateau forming the John Crow Mountains.

The coastline of Jamaica is one of many contrasts. The northeast shore is severely eroded by the ocean. There are many small inlets in the rugged coastline, but no coastal plain of any extent. A narrow strip of plains along the northern coast offers calm seas and white sand beaches. Behind the beaches is a flat raised plain of uplifted coral reef (which today are main targets for diving excursions).

The southern coast has small stretches of plains lined by black sand beaches. These are backed by cliffs of limestone where the plateaus end. In many stretches with no coastal plain, the cliffs drop 300 meters straight to the sea. In the southwest, broad plains stretch inland for a number of kilometers. The Black River courses seventy kilometers through the largest of these plains. The swamplands of the Great Morass and the Upper Morass fill much of the plains. The western coastline contains the island's finest beaches, stretching for more than six kilometers along a sandbar at Negril (one of the main tourist centers).3

1.2.2 The Climate

Two types of climate are found on Jamaica. An upland tropical climate prevails on the windward side of the mountains. Warm trade winds from the east and north-east bring rainfall. Temperatures are fairly constant throughout the year, averaging 25°C to 30°C in the lowlands and 15°C to 22°C at higher elevations. This is one of the main reasons for tourists to choose every year the Caribbean as their holiday destination. Only at the peaks of the Blue Mountains Temperatures may dip to below 10°C.

Jamaica lies at the edge of the hurricane track; as a result, the island usually experiences only indirect storm damage. Hurricanes occasionally score direct hits on the islands, however. In 1980, for example, Hurricane Allen destroyed nearly all of Jamaica's banana crop and left remarkable damages in the sugar cane fields.

1.3 People of Jamaica

1.3.1 Population

Jamaica had an estimated population of 2,304,000 persons, making it the most populous of the English-speaking Caribbean islands. The census in June 1992, recorded a total population of 2,095,858 persons, an increase of 13.4 percent over the 1970 census count of 1,848,508. Between 1970 and 1992, Jamaica's average annual rate of population growth was 1.1 percent, a relatively low rate in comparison with other developing countries. Jamaica's low rate of population growth reflected gradually declining birth rates and high levels of emigration, the country's most striking demographic feature. Nevertheless, significant reductions in mortality rates, resulting from better health care and sanitation, also affected the overall population growth rate, tending to raise it (see Appendix). 4,5

1.3.2 Population Growth and the National Population Policy

Jamaica's annual rate of population growth has been relatively stable since roughly the end of World War I. Between 1881 and 1921, emigration and disease caused the rate of population growth to fall to very low levels. Some 156,000 Jamaicans emigrated during this period, 35 percent of the country's natural increase. Between 1911 and 1921, the rate of growth was only 0.4 percent per year as workers left Jamaica for Costa Rican banana plantations, Cuban sugar estates, and the Panama Canal. The burgeoning industries of the United States and Canada also attracted many Jamaicans during this period. Thousands of Jamaicans, however, returned home with the fall of sugar prices precipitated by the Great Depression. As a result from 1921 to 1954, the rate of population growth rose, averaging

1.7 percent per year.

In July 1983 the Jamaican Parliament adopted the National Population Policy. The objectives of the policy were;

- to achieve a population not in excess of 3 million by the year 2000
- to promote health and increase the life expectancy of the population
- to create employment opportunities and reduce unemployment, underemployment, and emigration
- to provide access to family-planning services for all Jamaicans and reduce the average number of children per family from four to two, thus achieving replacement fertility levels
Country Report geo-o-jamaica.doc by Angela Blanco
- to promote balanced rural, urban, and regional development to achieve an optimal spatial distribution of population, and
- to improve the satisfaction of basic needs and the quality of life through improved housing, nutrition, education, and environmental conditions. 6

1.3.3 Ethnic groups

The country's national motto points to the various ethnic groups present on the island. Although a predominantly black nation of West African descent, Jamaica had significant minorities of East Indians, Chinese, Europeans, Syrians, Lebanese, and numerous mixtures thereof in the late 1980s. Approximately 95 percent of all Jamaicans were of partial or total African descent, including 76 percent of complete African descent, 15 percent of Afro-European descent, and 4 percent of either Afro-East Indian or Afro- Chinese descent. Nearly 2 percent of the population was East Indian, close to 1 percent Chinese, and the remainder was made up of Europeans, peoples of the Middle East, and others. Although racial differences were not as important as class differences, the lightness of one's skin was still an issue, especially since minorities were generally members of the upper classes. 7

About 75 percent of Jamaica's population was Protestant, and 8 percent was Roman Catholic; various Muslim, Jewish, and spiritualist groups were also present. Rastafarians constituted roughly 5 percent of the population. The Rastafarians, traditionally have used marijuana (called "ganja" in Jamaica) as a sacramental drug. Cultivated clandestinely in mountainous areas, ganja is rolled into huge flute-shaped cigarettes called spliffs and smoked. In other popular uses, ganja leaves are baked into small cakes, brewed for tea, soaked in rum, drunk with roots as an aphrodisiac, used as a poultice to reduce pain and swelling, or used popularly as a cold remedy.

Religious activities were popular, and religion played a fairly important role in society. The most striking religious trend occurring in Jamaica in the 1980s, as it was throughout the Americas, was the increasing number of charismatic or evangelical Christian groups.8

1.4 Political System

1.4.1 Constitutional monarchy

Jamaica is a constitutional monarchy and a parliamentary democracy based on the Westminster model, with a functional two-party system. Under this system of government, the prime minister and his cabinet are responsible to the legislature, and universal suffrage exists for citizens over the age of eighteen. The clauses of the 1962 Constitution, which consists of 138 articles in 10 chapters, may be amended by majorities of two-thirds in both houses of Parliament or, if the Senate does not concur, with the approval of a special majority of the electorate voting in referendum. 9

1.4.2 The Constitution

Jamaica's Constitution entitles anyone born on the island to Jamaican citizenship, which may be revoked if that person becomes a citizen of another country. Children and spouses of Jamaicans also may claim citizenship even if born outside of Jamaica. Chapter 3 of the Constitution grants all persons residing in Jamaica fundamental individual rights and freedoms, such as life, liberty, security of person, property ownership, and protection from arbitrary arrest or detention. The Constitution also guarantees freedom of conscience and expression, including freedom of speech and press; peaceful assembly and association, including the right to join a trade union; freedom of movement and residence within the country and of foreign travel, emigration, and repatriation; and due process of law, including protection against double jeopardy or retroactive punishment. The Constitution forbids inhumane treatment and racial, sexual, or political discrimination. Jamaican women are accorded full equality, and the 1975 Employment Act guarantees them equal pay for the same work.

Although an independent member of the British Commonwealth of Nations since 1962, Jamaica has retained the British monarch as its chief of state. Executive power is vested nominally in the queen but exercised by the governor general, whom the queen appoints on recommendation of the prime minister. 10

1.4.3 Political Dynamics

Jamaica's two-party system, which had its roots in the rivalry between William Alexander Bustamante and Norman W. Manley, resembles traditional North American patterns. Both parties--the JLP and PNP--were formed and operated by a relatively small number of men and with a high degree of British and intraparty cooperation. By the 1960s, politics had changed significantly from the time of the 1944 elections when the country was predominantly rural and voting was based as much on local issues and personalities as on national affairs. The JLP and PNP, responding to sectional interest groups, appeared to move closer to each other and away from the basic concerns of the population, namely employment opportunities.

The two-party arrangement differed from the British and United States systems in two important respects. One is that Jamaica's elites, from which the island's leaders have emerged, are closely knit groups; four of the nation's first five prime ministers were related. The other difference is that party identification, not race or class, is the primary political frame of reference. Each party has a fiercely loyal, almost tribal, inner core defined by family ties and neighborhood. Antagonism to the other party is passionate and frequently violent.

The PNP's dominant position in politics in the 1970s was reinforced on March 8, 1977, when the party won 237 out of 269 municipal seats in local government elections in which 58 percent of the electorate participated. By mid-term, however, internal PNP infighting between leftwingers and moderates had intensified and JLP opposition had escalated. Support for the PNP declined considerably as the public became increasingly concerned over the PNP's alliance with the communist Workers Party of Jamaica (WPJ), as well as growing unemployment, crime and other violence, internal party divisions, mismanagement of the government, and the government's close ties to Cuba.

The JLP, which continued to enjoy strong support in the business community, remained more pragmatic and flexible in policy than the PNP. JLP business executives and technocrats emerged in the top party positions, replacing the old guard labour leaders. Endorsing a platform described simply as "nationalism," JLP leaders continued to stand in the ideological center of the political system. They advocated a pro-United States, pro-free enterprise, and anti-Cuban ideology.11

1.5 Historical Settings

From May 5, 1494, when Columbus first set foot on what he described as "the fairest isle that eyes have beheld," to its emergence as an independent state on August 6, 1962, Jamaica passed through three main periods. First, it served for nearly 150 years as a Spanish-held way station for galleons en route to and from the Spanish Main. Second, from the mid-1600s until the abolition of slavery in 1834, it was a sugar-producing, slaveworked plantation society. Thereafter it was a largely agricultural, British colony peopled mainly by black peasants and workers. 12

The Spanish adventurer Juan de Esquivel settled the island in 1509, calling it Santiago, the name given it by Columbus. In the period of Spanish dominance from 1509 to 1655, the Spaniards exploited the island's precious metals and eradicated the Arawaks, who succumbed to imported diseases and harsh slavery. An English naval force sent by Oliver Cromwell attacked the island in 1655, forcing the small group of Spanish defenders to capitulate in May of that year. Within 3 years, the English had occupied the island, whose population was only about 3,000, but it took them many years to bring the rebellious slaves under their control.

Cromwell increased the island's white population by sending indentured servants and prisoners captured in battles with the Irish and Scots, as well as some common criminals. This practice was continued under Charles II, and the white population was also augmented by immigrants from the North American mainland and other islands, as well as by the English buccaneers. But tropical diseases kept the number of whites well under 10,000 until about 1740.

Although the slave population in the 1670s and 1680s never exceeded roughly 9,500, by the end of the seventeenth century imports of slaves increased the black population to at least five times the number of whites. Thereafter, Jamaica's blacks did not increase significantly in number until well into the eighteenth century. At the beginning of the eighteenth century, the number of slaves in Jamaica did not exceed 45,000, but by 1800 it had increased to over 300,000.

England gained formal possession of Jamaica from Spain in 1670 through the Treaty of Madrid. Early in the eighteenth century, the Maroons took a heavy toll on the British troops and local militia sent against them in the interior; their rebellion ended, however, with the signing of peace agreements in 1738. The sugar monoculture and slave-worked plantation society characterized Jamaica throughout the eighteenth century. With the abolition of the slave trade in 1808 and slavery itself in 1834, however, the island's sugar- and slave-based economy faltered. The period after emancipation in 1834 initially was marked by a conflict between the plantocracy and elements in the Colonial Office over the extent to which individual freedom should be coupled with political participation for blacks. In 1840 the assembly changed the voting qualifications in a way that enabled a majority of blacks and people of mixed race (browns or mulattos) to vote. But neither change in the political system, nor abolition of slavery changed the planter's chief interest, which lay in the continued profitability of their estates, and they continued to dominate the elitist assembly.

In 1846 Jamaican planters, still reeling from the loss of slave labor, suffered a crushing blow when Britain passed the Sugar Duties Act, eliminating Jamaica's traditionally favored status as its primary supplier of sugar. The Jamaica House of Assembly stumbled from one crisis to another until the collapse of the sugar trade, when racial and religious tensions came to a head during the Morant Bay Rebellion of 1865. Although suppressed ruthlessly, the severe rioting so alarmed the planters that the two-centuries-old assembly voted to abolish itself and asked for the establishment of direct British rule.

The Ras Taffari brotherhood (commonly called the Rastafarians), which in 1935 hailed Ethiopia's emperor Haile Selassie as its god (Jah), owed its origins to the cultivation of self-confidence and black pride promoted by Garvey and his black nationalist movement. Dissatisfaction with crown colony rule reached its peak during the period between the world wars, as demands for responsible self- government grew. A growing mulatto middle-class with increasingly impressive education, ability, and even property identified with British social and political standards, but white Jamaicans were beginning to feel offended by a perceived British indifference to their economic difficulties and political opinions. They also resented British monopoly of high positions and the many limitations on their own mobility in the colonial civil service, especially if they were of mixed race.

Jamaica received its independence on August 6, 1962. The new nation retained, however, its membership in the Commonwealth of Nations and adopted a Westminster style parliamentary system. Bustamante, at age seventy-eight, became the new nation's first prime minister and also assumed responsibility for the new ministries of defence and foreign affairs. Jamaicans welcomed independence, but they had already spent their nationalistic passion over the emotional issue of federation. The general feeling was that independence would not make much difference in their lives.

2. Current Macroeconomic Situation

2.1 GDP & General Policy Framework

Jamaica is an import-oriented economy with imports of goods and services totaling two- thirds of GDP. In 1999, imports of raw material amounted to $1,551 million, while imports of consumer goods and capital goods amounted to $894 million and $656 million respectively. Tourism (13 percent of GDP), bauxite/alumina (10 percent of GDP), and manufacturing (18 percent of GDP) are the major pillars sustaining the economy. In 1999, these three sectors accounted for 75 percent ($2.35 billion) of the country's foreign exchange earnings. Remittances are also a significant source of income and bring in over $600 million annually. Both GDP and foreign exchange inflows are sensitive to external economic factors, particularly with respect to commodity prices and the services/tourism sector. 13

Jamaica has a work force of 1.13 million people, representing 66.3 percent of total population (14 years and over). About half of the labour force are age 35 and above. Sixty percent of Jamaica's workforce is employed in the services sector, contributing about 66 percent of GDP. Agriculture, which accounts for 8 percent of GDP, employs 22 percent of the workforce. The primary products are sugar, bananas, coffee and cocoa. The small size of the Jamaican economy and relatively high production costs (e.g. domestic interest rates) have reduced the contribution of the manufacturing sector over the last several years to about 18.1 percent of GDP in 1997. Although apparel still accounts for nearly three- quarters of non-traditional exports, the industry is contracting. Several factories closed in 1997 and in early 1998, following more than a dozen factory closures in 1996. Consequently, current employment in the apparel industry is down to approximately 20,000, a decline of 42 percent from peak employment in 1994. 14

The Jamaican economy suffered negative growth of 2.4 percent in 1999, following negative growth of 1.8 percent in 1998. While there was some growth in bauxite/alumina, energy, construction, certain manufacturing sub sectors, and the tourism industry, other economic sectors such as agriculture, apparel, financial and other services continued along a recessionary path. Sustained high real interest rates, along with increasing uncertainty about the stability of the exchange rate, weakness in the financial sector, and lower levels of investment, continue to erode confidence in the productive sector.

Since the end of 1995, the banking and insurance sector has experienced serious difficulties caused by a mismatch of assets and liabilities. The financial sector found itself holding real estate and other long term assets that could not be easily disposed of to meet short term obligations. Diversification away from core business interests, along with high costs of operation and interlocking ownership of insurance companies and banks also contributed to the collapse of many Jamaican-owned financial institutions.

FINSAC (the Financial Sector Adjustment Company) is a government agency established in February 1997 to provide funding and to reorganize illiquid financial institutions. FINSAC is now in the second and third phases of restructuring and divesting the assets of these institutions. In the first phase, the government acquired control of a large number of financial institutions by injecting capital through preference or ordinary shares or the payoff of deposit liabilities through new deposit accounts. These interventions have amounted to J$73.5 billion or about $2 billion so far. In the process, FINSAC acquired a large share of equity in four of the island's nine commercial banks, five of the 12 life insurance companies, a portfolio of real estate (including 11 hotels) and a portfolio of nonperforming loans with a face value of J$20 billion or $548 million.

Other support programs to bolster the economy include equity funding from the public sector financial institutions through the National Investment Bank of Jamaica (NIBJ). The government has provided both financial and technical assistance to the export apparel sector and the coffee industry in order to prevent the collapse of these industries. The government recently took control over the island's failing sugar industry, which was divested in 1996, from the private sector.15

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2.1.1. Unemployment/Underemployment

There has been growing unemployment/underemployment as a result of lower exports, falling domestic demand, and the restructuring of companies. Major cash crops (e.g. sugar and bananas) have been affected by both the high cost of production and prolonged, adverse weather conditions (->see chapter climate).

The government has introduced two initiatives, the National Poverty Eradication Policy and Program (NPEP) and the National Industrial Policy (NIP), to address the economic slowdown, high levels of underemployment and growing social tension. The NPEP seeks to reduce the number of persons in absolute poverty, with special emphasis on youth, who experience high levels of unemployment. The NPEP includes programs to facilitate skill acquisition and entrepreneurial training which will be backed by appropriate credit and business support services. These programs are intended to contribute to overall employment generation through self employment activities. The NIP was adopted by the government in March 1996 as a long-term strategy to achieve sustained economic growth and development. During the first year, the NIP's target was to achieve macro-economic stability by maintaining a stable exchange rate and reducing inflation and interest rates. These objectives were substantially achieved during the course of the year. The NIP's second phase, a three-year period beginning in 1998, aims at achieving stable growth with stability by stimulating investment and export diversification. 16

2.1.2 The Bank of Jamaica and its Monetary Policy

The Bank of Jamaica was established in 1960 as the country's central bank. It was formed to replace the Currency Board, whose lack of authority to control the money supply had prevented the use of monetary policies. The bank issued currency, regulated the banking system, set minimum reserve ratios, adjusted liquid reserve ratios, established discount rates, and generally controlled credit. As part of the government's economic policies in the 1980s, the bank pursued a restrictive credit policy to lower aggregate demand in the economy. The tight credit policy was accomplished through higher reserve and liquidity ratios, which in 1985 required commercial banks to retain 50 percent of their assets in a liquid form. Likewise, the prime lending rate was maintained at high levels, reaching 23 percent in December 1985, or more than 10 percentage points higher than the prime rate in the United States. Another monetary policy of the bank was the devaluation of the Jamaican dollar to adjust the real rate of exchange to more realistic levels. The bank devalued the Jamaican dollar numerous times in the 1980s, lowering the exchange rate several times over its value in the 1970s. These policies were designed to help reduce the balance-of-payments deficit by making exports more competitive.

The BOJ continued its tight monetary policy to absorb excess liquidity by issuing long term securities (local registered stock) and short-term treasury bills. Increases in T-Bill rates have affected commercial bank lending rates. In September 1998, the lending rates averaged about 44 percent. Lending rates are expected to rise in step with T-Bill rates. Interest payments on maturing securities have served to increase liquidity, necessitating additional debt offerings.

The BOJ lowered the cash reserve requirement of commercial banks. The rate is expected to be lowered further by at least one percentage point every three months to an eventual 17 percent. Approximately 45 percent of commercial banks deposits are left with the central bank as a reserve (23 percent is a cash reserve requirement which earns no interest and the balance in liquid assets). Other institutions, such as merchant banks and trust companies, also have deposit and cash reserve requirements at lower levels. In response to the reduction of the cash reserve requirement, Jamaica's second largest bank (Scotia Bank) recently announced a new loan offer of up to J$1.3 billion (about $35 million) for the productive sector at 8.5 percent interest in order to bolster the productive sector. This sum, however, constitutes only about two percent of the loan portfolio of the commercial banks. Loan default rates at commercial banks are estimated at about 25 percent. 17

The government raised $250 million on the international capital market in early 1998, and expects to raise a further $150 million locally to support the fiscal deficit and balance of payment needs. Net International Reserves are approximately $617 million, the equivalent of 17 weeks of imports, down from a peak of $716 million in January 1997. 18

2.1.3 Exchange Rate

On September 26, 1991, exchange controls were eliminated to allow for free competition in the foreign exchange market. The principal remaining restriction is that foreign exchange transactions must be done through an authorized dealer. Licenses are regulated. Any company or person required to make payments to the government by agreement or law (such as the levy and royalty due on bauxite) will continue to make such payments directly to the BOJ. Five percent of foreign exchange purchases by authorized dealers (commercial banks and cambios) must be paid directly to the BOJ. In addition, according to an agreement between the Petroleum Company of Jamaica (PETROJAM) and the commercial banks, 10 percent of foreign exchange purchases go to PETROJAM.

As of October 10th, 2000 the exchange rate was J$ 43.9947 to $1.00. 19

The Jamaican dollar became legal tender when it superseded the Jamaican pound in 1969. Because of tourism, United States, Canadian, and British currencies also circulated, and illegal black markets were common. Many of the tourist hotels listed prices only in United States dollars because of the greater stability of that currency. Eastern Caribbean dollars (EC$ (the joint currency used by members of the Organisation of Eastern Caribbean States and pegged to the United States dollar at ES$270 equals US$1.00) were also visible. The value of the Jamaican dollar was tied to the British pound sterling until 1973, when it became pegged to the United States dollar. In the process, the Jamaican dollar moved from being the strongest currency in the Commonwealth Caribbean to being one of the weakest. After experiments with various types of exchange rates in the 1970s, exchange rates were unified in November 1983. Beginning in 1984, foreign exchange was allocated through a twice weekly foreign exchange auction system. 20

2.1.4 Structural Policies CARICOM AND CET

The Fair Competition Act was introduced in 1993 in order to create an environment of free and fair competition and to provide consumer protection. Prices are generally determined by free market forces; however, certain public utility charges such as bus fares, water, electricity, and telecommunications are still subject to price controls and can be changed only with government approval.

Taxation accounts for 93 percent of total recurrent and capital revenue. Major sources of tax revenue include: personal income tax (39.6 percent of tax revenue), value-added tax (29.5 percent) and import duties (11.1 percent). Based on the first quarter results of the budget, this year's budget deficit could turn out to be larger than forecast, since the projected budget is based on assumptions (substantial returns from tougher tax collection efforts, a sharp drop in public employee wage increases, returns on sales of assets by financial institutions which the government has taken over, a resumption of economic growth), which have not yet materialized, at least to the extent the government hoped.

Jamaica implemented the Caribbean Economic Community (CARICOM) Common External Tariff (CET) on February 15, 1991. Under the CET, goods produced in CARICOM21 states are not subject to import duty. Third-country imports are subject to import duties ranging between 0 percent and 25 percent, with higher rates applicable to certain agricultural items (for example, a maximum of 75 percent applied to milk). In addition to the CET, all items (except certain basic foods) carry a 15 percent general consumption tax; alcoholic beverages and tobacco imports carry an additional stamp duty of 34-56 percent, and a special consumption tax of 5.0-39.9 percent. Non-basic, finished goods, and goods competing with those produced in CARICOM states carry higher duty rates. The tariff rate that was scheduled to be phased down to a range of 0 to 20 percent by January 1998 has not yet been implemented. The government offers incentives to approved foreign investors that eliminate or reduce taxes, including income-tax holidays and duty-free importation of capital goods and raw materials.

All monopoly rights of the Jamaica Commodity Trading Company (JCTC) ceased December 31, 1991, but it retains responsibility for the procurement of commodities under government to government agreements.

2.1.5 Debt Management Policies

Jamaica's stock of external (foreign) debt was $3.3 billion (50 percent of GDP) in September, 1998. About 47 percent of this debt is owed to bilateral donors (the United States is the largest bilateral creditor), 36 percent to multilateral institutions (down due to a policy decision to reduce dependence on the IMF), 10 percent to private creditors (8 percent to commercial banks; 2 percent to other commercial institutions), and the remaining 7 percent to bond holders.

Actual debt-servicing during 1997 accounted for 16.76 percent ($523.07 million) of exports of goods and services, of which 34.1 percent represents interest payments. The ratio of total outstanding external debt to exports of goods and services decreased from 177.6 percent in 1990, to 100.3 percent in 1996 as a result of debt reduction efforts and improvements in exports, but has since climbed to 105.04 percent in 1997. The 1997 external debt per capita was $1,300, an increase of 1.3 percent over 1996.

Debt-servicing continues to be a major burden on the government's budget, accounting for some 52 percent of total outlays. In 1995 Jamaica ended its borrowing relationship with the IMF, but it continues repayment to the IMF thus contributing to the reduction of the debt burden. In 1995 Jamaica also completed its multi-year rescheduling arrangement with the Paris Club, negotiated in 1992. The arrangement provided for rescheduling of $281.2 million of principal and interest for the period October 1992 to September 1995. 22

Jamaica's internal debt has ballooned in recent years from J$23.4 billion in 1993 to J$49.1 billion in 1994, to J $59.5 billion in 1995, to J$77.7 billion in 1996 and to J$101.6 billion in 1997. As of August 1998, the internal debt stood at J$110.1 billion. The main factors contributing to the increased internal debt were:

- neutralizing the effect of increased domestic liquidity from the net international reserve accumulation
- budgetary financing
- liquidity support to commercial banks and
- intervening to absorb excess liquidity to maintain a stable exchange rate of the Jamaican Dollar.

Domestic debt is composed of government securities such as: T-Bills (10.9 percent), local registered stock (71.9 percent), bonds (10.4 percent), and loans from commercial banks and other entities (6.7 percent).

2.2 WTO and WIPO

Jamaica belongs to the World Trade Organization (WTO) and the World Intellectual Property Organization (WIPO), and is a signatory to the Berne Convention, Rome Convention, Phonograms Convention, and the Nairobi Treaty. In 1998, the U.S. Trade Representative placed Jamaica on the “Special Watch List”.

The Jamaican Parliament is considering legislation to protect and facilitate the acquisition and disposition of all property rights, including intellectual property. This legislation would bring Jamaica into conformity with WTO requirements for the protection of intellectual property. In March 1994, Jamaica and the United States signed a Bilateral Intellectual Property Rights (IPR) Agreement. A Bilateral Investment Treaty (BIT), which took effect in March 1997, also contains obligations to respect intellectual property.

Jamaican law addresses major areas of intellectual property rights protection. However, while amended laws on copyright and trademarks have reached an advanced stage, patent laws require further review to be consistent with international agreements. Remedies available include injunctions, damages, seizure, and disposal/destruction of infringing goods. Penalties may include fines or imprisonment. Levels of IPR enforcement are limited by overall demands on police and overburdened courts. The government is attempting to deal with the lack of public awareness through seminars and publications. 23

2.3 Aid

In 1998, Jamaica received $174.4 million of official development assistance from multilateral agencies and other countries on a bilateral basis reflecting a decline of 43 percent over 1996. Bilateral sources contributed $59.2 million, while multilateral financial institutions contributed loans and grants valued at $115.2 million.

The United States is a major aid contributor. In Fiscal Year 1999, $11.34 million was disbursed as development assistance, $5 million was provided under assistance programs, and another $5.63 million as military aid. In addition, there were 100 Peace Corps personnel who provided technical assistance in the areas of health, education, environment and small business development.24

3. The Economy

3.1 General Economic Information

Jamaica is a middle-income, oil-importing country that attempted diverse economic development strategies during the 1970s and 1980s. 25 Jamaica had the second largest GDP of the Commonwealth Caribbean, behind only Trinidad and Tobago, an oil-exporter. The island's GDP for 1985 was US$1.7 billion, or US$940 per capita. The major sectors of the economy were tourism, bauxite and alumina, manufacturing and agriculture. Bauxite and alumina, in particular, set the pace of Jamaica's postwar economic growth through new investment and foreign exchange earnings. Bauxite production declined rapidly in Jamaica in the 1980s, however, because of the prolonged recession in the world aluminium industry, global oversupply, and the departure of multinational producers. Tourism declined in the 1970s, but recovered between 1980 and 1990, thus becoming the most important sector of the economy (-> see chapter 3.3.1 Tourism). Manufacturing, a quite diversified sector, underwent structural changes in the 1980s when production was refocused on exports rather than on the domestic market. Agriculture, the heart of the Jamaican economy for centuries, has been in relative decline since World War II.

Jamaica enjoyed rapid growth rates during the 1950s and 1960s as the bauxite industry boomed. Real GDP growth averaged about 4.5 percent during these two decades. Economic growth was sporadic and weak from 1972 to 1986, however. Indeed, the Jamaican economy did not register two consecutive years of significant growth during that period. Between 1973 and 1980, the island experienced seven consecutive years of negative growth. The economic downturn in the 1970s demonstrated the highly mobile nature of both labor and capital in Jamaica, as skilled labor and investment capital left the island. The democratic socialist government of Michael Manley from 1972 to 1980 was popularly blamed for the poor performance during the 1970s. Nevertheless, Manley's successor and conservative political opponent, Edward Seaga, was also unable to turn the economy around during his first six years in office. The economy experienced sporadic and unsustained growth in the early 1980s. GDP declined by 4.5 percent in 1985 but rose again in 1986 by more than 2 percent. In the mid1980s , the Jamaican economy was about where it was in 1980 in terms of real GDP. Negative growth in the 1980s was generally attributed to the acute decline in the world bauxite market.

Jamaica was hardly immune from the structural economic problems affecting other developing countries. Beginning in the mid-1970s, inflation was generally double-digit, caused primarily by the increase in world oil prices, expansionary fiscal policies, and entrenched labour unions. Chronic unemployment and recession coexisted with high inflation during the 1970s, causing stagflation. Unemployment averaged roughly 25 percent during the 1975-85 period, affecting women and urban youth the hardest. The country also faced rapid urbanization as economic opportunities in rural areas deteriorated. In 1960, about 34 percent of the island's population was considered urban, but by 1982 that figure had risen to about 48 percent as opportunities in rural areas declined. Like other countries in the Western hemisphere, Jamaica quickly compiled a large external debt in the 1970s and 1980s; by the end of 1986, it amounted to US$3.5 billion, one of the highest per capita debts in the world.

In the 1980s, Jamaica's economy was generally defined as free enterprise, although major sectors were government controlled. The PNP governments in the 1970s were the most active in increasing state ownership. Although some private companies were purchased, the more usual pattern was to create joint public-private enterprises or to increase government regulation of the private sector, especially of foreign multinationals. In the 1970s the state ownership was largely financed by a levy on bauxite production, introduced in 1974, and by deficit spending.

In 1980 Seaga was elected on a platform of denationalization and deregulation of the economy. In his first six years in office, however, Seaga achieved mixed results. Denationalization did occur in tourism and agriculture, but the role of government actually increased in oil refining and bauxite production after several large firms unexpectedly left the island. As of early 1987, the structural adjustment of the economy was nearly completed and increased government divestments were forecast.

3.1.1 Growth and Structure of the Economy

The first European settlers, the Spanish, were primarily interested in extracting precious metals and did not develop or otherwise transform Jamaica. In 1655 the English occupied the island and began a slow process of creating an agricultural economy based on slave labour in support of England's industrial revolution. During the seventeenth century, the basic patterns and social system of the sugar plantation economy were established in. Large estates owned by absentee planters were managed by local agents. The slave population increased rapidly during the last quarter of the seventeenth century and, by the end of the century, slaves outnumbered white Europeans by at least five to one. Because conditions were extremely harsh under the slave regime and the mortality rate for slaves was high, the slave population expanded through the slave trade from West Africa rather than by natural increase.

During most of the eighteenth century, a monocrop economy based on sugar production for export flourished. In the last quarter of the century, however, the Jamaican sugar economy declined as famines, hurricanes, colonial wars, and wars of independence disrupted trade. By the 1820s, Jamaican sugar had become less competitive with that from high-volume producers such as Cuba and production subsequently declined. By 1882 sugar output was less than half the level achieved in 1828. A major reason for the decline was the British Parliament's 1807 abolition of the slave trade, under which the transportation of slaves to Jamaica after March 1, 1808 was forbidden; the abolition of the slave trade was followed by the abolition of slavery in 1834 and full emancipation within four years.

The second half of the nineteenth century was a period of severe economic decline for Jamaica. Between 1865 and 1930, the character of landholding in Jamaica changed substantially, as sugar declined in importance.The rise of the banana trade during the second half of the nineteenth century also changed production and trade patterns on the island. Bananas were first exported in 1867, and banana farming grew rapidly thereafter. By 1890, bananas had replaced sugar as Jamaica's principal export.

The Great Depression caused sugar prices to slump in 1929 and led to the return of many Jamaicans. Economic stagnation, discontent with unemployment, low wages, high prices, and poor living conditions caused social unrest in the 1930s. Uprisings in Jamaica began on the Frome Sugar Estate in the western parish of Westmoreland and quickly spread east to Kingston. Jamaica, in particular, set the pace for the region in its demands for economic development from British colonial rule.

The expanding relationship that Jamaica entered into with the United States during World War II produced a momentum for change that could not be turned back by the end of the war. This led to important modifications in the Jamaican political process and demands for economic development. As was the case throughout the Commonwealth Caribbean in the mid- to late 1930s, social upheaval in Jamaica paved the way for the emergence of strong trade unions and nascent political parties. These changes set the stage for early modernization in the 1940s and 1950s and for limited selfrule , introduced in 1944. 26

3.2 Economic Sectors

3.2.1 Mining

In spite of its relative decline, during the 1980s mining remained one of the most important sector of the economy in terms of foreign exchange. Bauxite was by far the most dominant mineral and subsector in the economy. The mining of bauxite had generated over 50 percent of export earnings since the 1960s. Nevertheless, bauxite production was declining and output in 1985 equaled 6 million tons, only half of the 1980 level. As bauxite exports declined and receipts from tourism increased in the 1980s, tourism replaced bauxite as the greatest foreign-exchange earner.

Although a large foreign-exchange earner, bauxite production represented only 5 percent of GDP in 1995 and employed under 1 percent of the labour force. The very capitalintensive nature of the industry made it a controversial subsector because of the high rates of unemployment on the island. Likewise, the large presence of North American aluminum companies extracting the ore was also a prominent issue.

Jamaica's bauxite reserves are large, exceeding 1.5 billion tons. At the present rate of extraction, reserves could last another 150 years. Jamaica's bauxite is not extremely alumina pure; one ton of Jamaican bauxite contains only about 0.4 tons of alumina. The island's bauxite comparative advantage lies in the easy extraction of the metal ore as a result of its close proximity to the surface. 27

Although generally beneficial for the economy, Jamaica's bauxite industry must import large amounts of caustic soda and heavy machinery to mine and export the ore, making the industry highly import intensive. Likewise, the mining of the ore has raised environmental concerns over bauxite by-products discharged in highly visible red lakes.

Gypsum, mined in eastern Jamaica since 1949, was the second most important mineral in the 1990s. Reserves of at least 80 percent purity amounted to over 4 million tons out of total reserves exceeding 40 million tons. Some gypsum was used in the local manufacturing of tiles and cement, but over 90 percent of the mineral and its derivative, anhydride, were exported unprocessed to the United States and Latin America. Jamaica normally produced roughly 180,000 tons of gypsum a year. 28

3.2.2 Agriculture

The decline in agriculture's share of both GDP and the labour force continued in the 1980s. From 1990 to 1995, agriculture as a share of GDP dropped from 8.3 percent to 5.7 percent. Likewise, the percentage of the labour force in agriculture decreased from over 30 percent in the 1970s to 24 percent by 1995. Agriculture's inability to keep pace with other sectors of the economy or population growth forced an increase in food imports. As a result of these trends, Jamaica's total food import bill increased eleven fold from 1960 to 1990. These patterns were likely to persist because fewer younger people were entering farming. For example, in 1985 an estimated 50 percent of the agricultural labour force was over fifty years of age and 30 percent over sixty years. In the 1990s, government policies sought to revive declining production of traditional export crops and to introduce and promote non- traditional export crops through the commercialisation and modernisation of the sector.29

3.2.3 Manufacturing

For a small developing country, Jamaica had quite diversified manufacturing. Sugar, condensed milk, rum (sugarcane), edible oils, cloth carpet, cigarettes, and shoes were some of the more basic manufactured goods. Production also included heavier industrial goods, such as sulfuric acid, detergents, fertilizers, gasoline, petroleum, batteries, and steel. The sector accounted for 18.7 percent of GDP in 1999 and employed 127,000 workers, or 12 percent of the labour force. 30

During the 1990s, the manufacturing sector underwent its first major changes since independence, reflecting the government's structural adjustment policies, which emphasized labour-intensive, export-oriented light manufacturing. As a result, a growing percentage of manufactured goods, particularly non-traditional items, were produced solely for export. Apparel and sewn products, mineral fuels, and miscellaneous manufactured goods experienced the fastest growth rate.

The manufacturing sector was historically linked to agricultural processing until World War II, when general shortages encouraged import substitution industrialization in such areas as clothing and footwear. From 1950 to 1968, the sector's growth outpaced all other sectors of the economy, expanding 7.6 percent annually, including over 10 percent growth in the last five years of this period. The growth of domestic industries also relied on generous government import protection in the form of quantitative restrictions beginning in the 1960s and an overvalued exchange rate starting in the 1970s. Chemicals, cement, furniture, and metal products were the most important subsectors to emerge as a result of 31 the import substitution policies.

3.2.4 Construction

In the early 1980s, the construction industry had yet to recover from the short- and long- term decline experienced during the 1970s. Construction had increased during the initial expansion of the bauxite and tourist industries, because both required a great deal of physical infrastructure. Construction stagnated in the 1970s, however, because of aggregate declines in investment, downturns in tourism, and the peak in bauxite mining. By the 1990s, the most common construction activities were new tourist hotels, factory space, and residential housing. Construction recovered in 1992 and 1993. 32

Many of the materials used in the construction industry were produced locally, although imports of iron, steel, and wood remained significant. Cement production reached 240,000 tons in the mid-1990s. All cement was produced at the Caribbean Cement (I.C.) plant in Kingston, of which government shares were sold to a Norwegian company in 1987. Steel, produced by the Caribbean Steel Company and BRC Ltd., stood at 18,300 tons by middecade. The Jamaica Mortgage Bank and the National Housing Trust were the key financial institutions in the construction sector. 33

3.3 Services

3.3.1 Tourism

Tourism was one of the brightest spots of the economy in the 1990s as, depending on bauxite output in a given year, it became the first leading foreign exchange earner. Net earnings from tourism nearly doubled in the first six years of the decade, reaching US$437 million in 1996. Tourist arrivals increased 53 percent over the five-year period from 1991 to 1995. Hotel occupancy rates rose from 41.5 percent in 1981 to the 70-percent range in 1996 and early 1997.

Jamaica's appeal to tourists came from its scenic beauty, warm climate, and white sand beaches, as well as the warmth of its people. The island's proximity to the large North American tourist market was another advantage. An expensive government advertisement campaign, beckoning American tourists to "come back to Jamaica," as well as more cruise ship stopovers spurred tourist development in the early 1980s. Jamaica ranked second only to the Bahamas as the preferred vacation location for American tourists in the Caribbean. Direct employment in tourist hotels increased from 9,527 in the early 1980s to 13,619 in the early 1990s. Although this employment represented only a small percentage of the total work force, the industry indirectly created numerous service jobs in restaurants, transport, entertainment, and crafts.

Jamaica recorded 846,716 visitor arrivals in 1995. Stop-over visitors numbered 571,713 and cruise ship passengers totalled 261,508. Some 13,495 servicemen also visited the island, many of whom were United States soldiers from the naval base in Guantanamo Bay, Cuba. Ninety percent of all tourists in Jamaica originated in North America, with about 75 percent coming from the United States. Europeans and Latin Americans made up the remaining 10 percent. Canadians and Europeans tended to stay longer than Americans, whose average stay was roughly one week. Although Jamaican citizens received discounted hotel rates, costs remained too high for most Jamaicans.

Jamaican tourism was quite diversified, ranging from camping in the Blue Mountains, to small beach houses in Negril (now enriched with big hotel resorts which are not allowed to be constructed higher than the highest palm tree), to large tourist hotels in Montego Bay and Ocho Rios. The country's room capacity exceeded 83,000 rooms, served by over 1500 hotels and various other guest houses. Most large hotels were foreign owned, whereas the majority of smaller hotels were locally owned. In the 1980s, the government divested numerous hotels that were purchased by the government in the 1970s.

Since 1956 the tourist industry has been regulated by the Jamaican Tourist Board (JTB) which greeted tourists, provided courtesy police, trained workers, set standards, and promoted Jamaican tourism both at home and abroad. One of the largest problems that the JTB faced in the 1980s was the continued harassment of tourists. Most harassment stemmed from frequent peddling of goods to tourists, at times incessantly; this peddling most likely reflected the high unemployment rates. Tourists were also approached to purchase drugs, primarily marijuana, colloquially called "ganja."

Although most Jamaicans were favourable toward tourism, certain sectors of society frowned on it for its perceived negative moral influences. Others doubted its contributions to the economy, given both the large percentage of imported goods used in the industry and the prominent role of foreigners. 34

3.3.2 Banking, Financial Services

In the 1980s, Jamaica had a well-established financial system that was expanding. Since 1962, the number of financial institutions had more than doubled to over forty, including the country's central bank, development finance banks, commercial banks, trust companies, merchant banks, building societies, insurance companies, peoples co-operative banks, finance houses, and credit unions. The government's economic policies in the 1980s favoured greater use of monetary factors to influence the economy and tighter credit policies than previously used so as to restrain inflation. 35

3.3.2.1 Commercial Banks

As a result of the historical reluctance of many commercial banks to make medium- to long-term loans, several government banks were created to finance economic development. The most important such government-sponsored bank was the National Development Bank of Jamaica. Other government banks supplying credit to specific sectors of the economy included the Jamaica Mortgage Bank, the Agriculture Credit Bank, the Jamaican Industrial Development Corporation, the Small Business Loan Board, and the Workers Savings and Loan Bank. These banks generally offered favourable interest rates and some technical assistance where appropriate.

There were eight commercial banks in Jamaica in 1995, all of which were originally or remained foreign owned. The British Barclay's Bank was the first commercial bank on the island, established in 1836 to finance the sugar industry. It was followed by three large Canadian Banks, which eventually came under local ownership and were renamed the Bank of Nova Scotia Jamaica, the Royal Bank of Jamaica, and the Bank of Commerce Jamaica. In the 1960s, American banks such as Citibank and Chase Manhattan Bank also entered the island. Barclay's Bank, later named the National Commercial Bank, was bought by the government in the 1970s; the government returned the bank to private hands in 1987, however. In 1995, 63 percent of all private-sector assets in major financial institutions were found in the commercial banks.36 Throughout the 1990s, commercial banks made three to four times more loans to the private sector than to the public sector.

Loans were distributed approximately as follows: 25 percent to manufacturing, 20 percent to construction and land development, 16 percent to agriculture, 12 percent to transport, storage, and communications, and the balance to various other sectors.

3.3.2.2 Life Insurance

Life insurance companies, building societies, trust companies, and merchant banks were other prominent financial institutions in Jamaica. Their share of private-sector assets ranked 19 percent, 7.4 percent, 7 percent, and 4 percent, respectively. In 1985 there were over twenty insurance companies in Jamaica, most of which held assets in large foreign firms. Insurance companies played an important role in building savings for investment in the economy. Building societies, all locally owned, were less numerous than insurance companies and generally attracted smaller savings to finance mortgages. Trust companies lent to commercial banks, provided trustee services, and held time deposits. Merchant banks functioned to underwrite securities, finance external trade, and offer managerial advice to industry. Several new merchant banks were established in the 1980s, including the Falcon Fund and the Export-Import Bank. 37

3.4 Stock Exchange

The Jamaican Stock Exchange, the oldest in the Caribbean, was established in 1969 under the direction of the Bank of Jamaica. Only a small percentage of the country's capital assets were traded on the original exchange, as most companies were either foreign- owned or purely family-run businesses. The number of shares traded grew rapidly in the mid-1980s; these included the shares of some new publicly owned companies. As of early 1997, only fourty-nine companies were listed on the exchange. The exchange's performance in 1999 quadrupled the performance of 1998. In 1999, 37.6 million shares were traded for US$21.3 million compared with 9.7 million shares for US$7 million in the preceding year. From 1991 to 1996, the exchange's composite index increased 129 percent, standing at 1,499.87 by the end of 1996. A major cause of the rise was the increasing number of companies that issued public equity shares, rather than relying on commercial banks, to raise capital. 38,39

4. Conclusion

4.1 Major Problems

Under Jamaica's structural adjustment program, the Government implemented macro- economic policy reforms that have strengthened Jamaica's market-oriented economy with emphasis on exports and investment. Tariff rates have been reduced, quantity restrictions eliminated, and price controls and food subsidies abandoned. These policy reforms, complemented by the liberalisation of the foreign exchange regime and improved monetary and fiscal policies, assisted Jamaica toward further opening its market-driven economy, supported by democratic institutions. However, the significant progress made toward Jamaica's macroeconomic health is contrasted by deteriorating living conditions for the majority of Jamaicans. While economic growth has averaged one percent since 1991, it has been stagnant in per capita terms. Additionally, an increase in the numbers of poor people corresponds with one of the most unequal income distributions in the world. In view of these trends, Jamaica's challenge will be to ensure sustainable economic growth and participation by low-income groups in the growth process. That challenge is intensified by a continued trade imbalance, high interest rates, widespread crime and violence, and Jamaica's large external debt (totalling about $3.6 billion). 40

Jamaica's economic and social well being is inextricably linked to the state of its fragile natural resource base, particularly given the importance of tourism, agriculture and mining. The environment continues to be under severe attack as the Jamaica's population grows in coastal and urban areas. Economic activity is concentrated in these areas (tourism, agriculture and mining), resulting in deforestation and loss of natural systems and habitats.

Jamaica's leading source of foreign exchange is tourism, but the flow is uncertain year-to- year. Other principal foreign exchange earners (bauxite, sugar, and bananas) have suffered from world market fluctuations. Jamaica's apparel exports have declined sharply as a result of productivity problems and a relocation of the industry to Mexico as a result of the North American Free Trade Agreement (NAFTA). Although unemployment has fallen to about 15% from 25% in the early 1980s, most labour is absorbed by the informal sector where wages are extremely low and micro-businesses often fail. Jamaica's economic dependence on tourism, bauxite, and traditional agriculture has generated a wide range of negative impacts on the country's natural resource base, including deforestation, soil erosion, pollution, and dwindling marine resources which threaten the very existence of these key sectors.41

4.2 Future Perspectives

Jamaica's environmental strategic objective is targeted at conserving the natural resources upon which sustainable long-term development depends. To achieve this strategic objective, focus should be put on the following targets:

- expanded areas of key natural resources under sustainable management q increased financial resources for environmental management
- strengthened capacity of Jamaican organisations to sustainable manage natural resources and
- established environmental policies and regulations to conserve key natural resources.42

The greatest social challenge is to provide opportunities for younger generations of Jamaicans, who are particularly affected by crime and violence, AIDS and other sexually transmitted diseases, and a decline in literacy and other basic education standards. Together these problems put youth at risk, and compromise the potential of tomorrow's workforce.

Jamaica's long-term development prospects are dependent on its ability to provide equitable growth, reduce poverty, earn foreign exchange through increased exports, conserve its natural resources and generate productive employment for a literate citizenry. Jamaica needs a continued, traditional development assistance program until the number of remaining development challenges are met. With solid progress in macroeconomic reform, and the renewed priority placed by the government and donors on poverty alleviation and reduction, Jamaica will maybe one day reach real independence.

Appendix

Census Table of the last 150 Years

Abbildung in dieser 43 Leseprobe nicht enthalten

Map of CARICOM Members

Abbildung in dieser Leseprobe nicht enthalten

Flag of Jamaica

Sources

(Alphabetical Order)

Andres Danielson, The Political Economy of Development Finance

Bank of Jamaica,please also see http://www.boj.org.jm/home30.html, ROLE & FUNCTIONS OF THE CENTRAL BANK

Black, Clinton V. : History of Jamaica, London 1974 Brockhaus ( Edition October 1, 1985)

Higman, B.W. : Slave Population and the Economy in Jamaica, 1807-1834

http://search.britannica.com/frm_redir.jsp?query=jamaica+climate&redir=h http://www.jamaica-gleaner.com/gleaner/discover/geography/

http://www.boj.org.jm/home30.html

http://www.usaid.gov/pubs/cp98/lac/countries/jm.htm

http://www.wipo.org/eng/document/govbody/wo_gb_cf/cf17_1a2.htm http://www.xe.net/ict/table.cgi

Jamaica Bauxite Institute (JBI) Jamaica Tourist Board Leaflet

Jamaican Embassy Report, 1998 Political Parties

Jamaican Gleaner, please see

http://www.jamaicagleaner.com/gleaner/electionwatch/electoral_code

Jamaican Constitution

Manderson and Hanzel; The Story of the Jamaican People

Political Database of the Americas; The Jamaica (Constitution) Order in Council 1962 Public Sector Expansion and Economic Development in Jamaica Publication of Ministry of Agriculture and Mining, Honourable Horace Clarke

Senate Committees on Foreign Relations and on Finance and to the House Committees on Foreign Affairs and on Ways and Means, January 1998

Statistical Institute of Jamaica,

Statistical Institute of Jamaica, Report 1992

The Economist Intelligence Unit: Country Profile: Jamaica 1999 - 2000, London 1999 The Economist Intelligence Unit: Investment, Licensing and Trading, April 1999 Worrell, Keith: The economy of modern Jamaica - an outline

The Jamaica National Population Policy, Revised Version, Kingston, Jamaica, Planning Institute, July 1992

US Department of State on Foreign Relations; Report 1999

[...]


1 See Brockhaus ( Edition October 1, 1985) , Chapter Jamaica

2 See http://search.britannica.com/frm_redir.jsp?query=jamaica+climate&redir=http://www.jamaica- gleaner.com/gleaner/discover/geography/

3 See Brockhaus ( Edition October 1, 1985) , Chapter Jamaica

4 See Appendix A for Census Data of the last 150 years.

5 Source: Statistical Institute of Jamaica, Report 1992

6 The Jamaica National Population Policy, Revised Version, Kingston, Jamaica, Planning Institute, July 1992

7 Statistical Institute of Jamaica

8 See Black, Clinton V. : History of Jamaica, London 1974, different chapters

9 See Jamaican Gleaner; Jamaican Constitution, http://www.jamaica-gleaner.com/gleaner/electionwatch/electoral_code.html

10 Political Database of the Americas; The Jamaica (Constitution) Order in Council 1962

11 Jamaican Embassy Report 1998; Political Parties

12 For all following information please see Manderson and Hanzel; The Story of the Jamaican People; Chapter 1-3

13 The Economist Intelligence Unit: Country Profile: Jamaica 1999 - 2000, London 1999

14 The Economist Intelligence Unit: Country Profile: Jamaica 1999 - 2000, London 1999

15 See Andres Danielson, The Political Economy of Development Finance : Chapter:Public Sector Expansion and Economic Development in Jamaica

16 Senate Committees on Foreign Relations and on Finance and to the House Committees on Foreign Affairs and on Ways and Means, January 1998.

17 http://www.boj.org.jm/home30.html, ROLE & FUNCTIONS OF THE CENTRAL BANK

18 The Economist Intelligence Unit: Country Profile1998-1999

19 http://www.xe.net/ict/table.cgi

20 http://www.boj.org.jm/home30.html

21 See Appendix for Map of Members and Pie-chart of Distribution

22 http://www.boj.org.jm/home30.html

23 http://www.wipo.org/eng/document/govbody/wo_gb_cf/cf17_1a2.htm

24 US Department of State on Foreign Relations; Report 1999

25 Fao all following information please see: The economy of modern Jamaica - an outline by Keith Worrell; Page 11-97 and different others sequences

26 See B.W. Higman, Slave Population and the Economy in Jamaica, 1807-1834, page 49-112

27 Jamaica Bauxite Institute (JBI)

28 See Publication of Ministry of Agriculture and Mining, Honourable Horace Clarke

29 See Publication of Ministry of Agriculture and Mining, Honorable Horace Clarke

30 The Economist Intelligence Unit: Investment, Licensing and Trading, April 1999

31 The Economist Intelligence Unit: Investment, Licensing and Trading, April 1999

32 The economy of modern Jamaica : an outline by Keith Worrell

33 The Economist Intelligence Unit: Investment, Licensing and Trading, April 1999

34 Jamaica Tourist Board Leaflet

35 www.boj.jm

36 www.boj.jm

37 www.boj.jm

38 www.boj.jm

39 The economy of modern Jamaica : an outline by Keith Worrell, page 90-101, 115

40 Andres Danielson, The Political Economy of Development Finance

41 http://www.usaid.gov/pubs/cp98/lac/countries/jm.htm

42 http://www.usaid.gov/pubs/cp98/lac/countries/jm.htm

43 Statistical Institute of Jamaica

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Jamaica's economic development. From slavery to economic independence
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2001
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Anonymous, 2001, Jamaica's economic development. From slavery to economic independence, Munich, GRIN Verlag, https://www.grin.com/document/100087

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