JG - Is foreign investment beneficial to Jamaica?

From my archive of press clippings:

Jamaica Gleaner

Is foreign investment beneficial to Jamaica?

published: Sunday May 25, 2008

Edward Seaga

From the earliest days of our modern history, Jamaicans have been cultured to believe in foreign investment as the lifeline which will overcome the capital deficiency of the country. Where the country is short of capital, foreign investment will supply it. Hence, everything must be done to attract this foreign investment.

Read the whole article here.

Snippet(s):

"The benefit of this type of investment should be the jobs it provides for labour in a country chronically short of employment for the people and the foreign exchange it might earn."

"Foreign investment is essential to providing employment, which cannot be provided otherwise or in developing Jamaican resources, which cannot be developed by Jamaican capital (bauxite mining, alumina).

In the 1950s the strategy adopted to fulfil this mantra was to encourage bauxite mining, invite manufacturers to produce goods locally and set up hotels to develop tourism.

This was the three-pronged strategy."

"Jamaica has ceased to be attractive to foreign manufacturers seeking cheap labour.

The Caribbean and Central America region offers cheaper labour rates."

"(I)t would be very difficult to find products which could be manufactured here by assembly or otherwise on a competitive basis, since China now virtually dominates that market as the factory of the world."

"The tourism sector offers a substantial number of jobs for Jamaicans.

It is becoming the largest employer of labour in the country.

It is also one of the top two foreign exchange earners.

This is almost like a free zone in concept where the investor imports practically everything duty free and the net benefit to Jamaica is the revenue and foreign exchange earned by workers and utility services."

&

"(T)ourism is a win-win investment strategy so long as it is recognised that only 34 per cent of tourism earnings are retained in Jamaica.

The success of tourism needs no help from Jamaica Trade and Invest (JTI).

So what is the need for six overseas offices?"

Edward Seaga is a former prime minister. He is now a Distinguished Fellow at the UWI, Mona campus. Email: odf@uwimona.edu.jm/columns @leanerjm.com.