Elizabeth Morgan | Vision 2030 Jamaica: The link between trade and development

It was recently reported that Jamaica, through its development plan, Vision 2030 Jamaica, will not achieve its goal of development status by its target date of 2030. The plan had envisioned Jamaica achieving developed country status within 21 years from 2009. This long-term plan was launched in 2007, in a departure from the customary five-year plans, and was to be completed by 2008.

This failure to meet the target is actually not surprising, and there are several reasons for this, including the 2007-2009 financial crisis and COVID-19. But would the target have been met without these crises? Was there a deficiency?

The consultations and the launch of the plan are recalled from another life. The plan initially took account of the UN Millennium Development Goals (MDGs) which had its target date as 2015.

From the initial consultations, it was thought that Vision 2030 did not place enough emphasis on international trade and its role in development. Jamaica is a small open, trade dependent nation. In 2007, trade was 101 per cent of the gross domestic product (GDP), with exports of goods and services being 40 per cent of GDP, and imports of goods and services about 61 per cent.

In 2022, trade in goods and services was about 73 per cent of the GDP, with exports in goods and services being 28 per cent and imports of goods and services about 45 per cent. So, trade has declined overall with a significant decline in exports from 40 per cent of GDP in 2007 to 28 per cent in 2022. This would take account of the fallouts in the bauxite and agriculture sectors.

Vision 2030 Jamaica has Goal 3 as ‘Jamaica is prosperous’. To make this happen, the outcomes to be achieved are: a stable macroeconomy; an enabling business environment; a strong economic infrastructure; energy security and efficiency; a technology enabled society; and an internationally competitive industry structure.

Regional and international trade actually fall under ‘an enabling business environment’ and, in the sector plans, there is none specially dealing with trade. It would be argued that trade falls within the sector plans dealing with agriculture, manufacturing, tourism, services and information and communication technology (ICT). The focus is also on building international competitiveness.

RESOURCES FOR FINANCING VISION 2030

A frequently asked question related to implementing the Vision 2030 plan is about the sources of financing. The response given states that Jamaica’s development is financed through the budgetary allocations of government and its partners, including international development partners; by domestic and foreign private sector investment; the diaspora and other groups, including the citizenry through their financial/economic choices and actions. There is no clear mention of Jamaica needing to increase its production and exports of goods and services, which includes tourism.

There have been two articles in this column dealing with the role of trade in implementing the UN development plans, specifically the 2015 UN Sustainable Development Goals (SDGs). These articles are the June 19, 2018, ‘Trade is critical to achieving the UN Goals’, and the October 4, 2023, ‘Trade and Implementing the UN SDGs’.

As stated, Vision 2030 Jamaica was launched in 2007 when the UN MDGs were still being implemented. It is now linked to the 2015 UN SDGs which clearly indicate in Goal 17 that trade is important in financing the goals, along with development assistance from partners. The target date for implementing the SDGs is also 2030, and will also not be met. The aim of further liberalising global trade has also met upon roadblocks with questions of whether it has been in the interest of some countries.

Nevertheless, for the Jamaican economy to grow, it has been said many times that the country needs to increase production and its exports of goods and services. Jamaica’s Foreign Trade Policy adopted in 2018 stated that exporting should be a national priority taking an all-of-government approach in implementation. Exporting involves almost the entire government structure as well as the private sector and civil society.

EXPORT-DRIVEN GROWTH

Vision 2030 Jamaica, in my view, did not emphasise that Jamaica needed to focus on expanding production and exports in goods and services for growth. It was not explicitly stated that expanding exports would contribute to increasing the resources available for financing development.

The general view of many is that development financing comes mainly from external sources, with the greater emphasis being on loans and assistance from development partners. Now, too, the emphasis is on creating a stable macroeconomy, including reducing debt. The private sector wanted to focus on import substitution to supply the domestic market.

In the productive sectors, Jamaica’s exports of goods from agriculture and manufacturing are not growing at a strong rate. While tourism is increasing, it could be much better. Other services need to be further improved, including in the cultural and creative industries. Regarding the latter, it is clear that there is talent in Jamaica, but is it being channelled in the right directions, especially in quality of output?

Looking at the various indices, it does not appear that Jamaica is improving at desired rates in doing business, competitiveness, productivity, and innovation. All of which are important in attracting investors, increasing production, and increasing exports. Another significant area is also in reducing crime.

The fallout in exports is seen in many rural areas in which production and export of bauxite/alumina and agricultural products, including sugar and bananas, have declined.

As pointed out in other articles, there has been no replacement for the export earnings from bananas and sugar prior to 2009. Jamaica’s growth should be driven by exports.

So, in Vision 2030, the link was not explicitly and effectively made between trade and development. The link was assumed.

Elizabeth Morgan is a specialist in international trade policy and international politics. Email feedback to columns@gleanerjm.com