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Jamaica: Debt Storm Coming?

Categories: Caribbean, Jamaica, Citizen Media, Economics & Business, Media & Journalism, Politics

The Jamaican blogosphere has been a bit prickly ever since the Chicago Tribune, in an editorial on January 8, 2013 [1], compared Jamaica’s financial condition to that of Greece, considered by some to be the most precariously perched country in the global economy.

Blogging at Active Voice [2], Annie Paul noted that the Tribune “drew attention to Jamaica as another Greek tragedy waiting to happen” by flat-out stating the island nation was “in worse financial shape than Greece” and “caught in a debt trap”. Its proposed solution? “A restructuring, and a bailout with significant debt relief.” Paul commented:

This bald statement of Jamaica’s stark reality has deeply shaken this nation whose citizens have never had a liking for plain talk. Being a former sugar plantation, the product is abundantly available, and sugar-coating the truth is routine.

She went on to quote some of the “excited chatter” surrounding the issue, reposting a comment from one of her Facebook friends:

Ok – so Jamaica has a serious and critical debt problem. This is therefore the challenge of our time, for our generation to fix and I believe wholeheartedly that we can – why are we educated if not to find solutions? if we don’t, then our children will have to fix it, and if they don’t then theirs will. Could I find just 20 humble and willing people who aren’t motivated by greed and personal welfare, who aren’t caught up with always going to party at maiden cay and getting drunk on Friday nights – who are not so egotistic as to think that they are better than their ordinary countrymen , who are patient and ingenious , who are prepared to sacrifice for the good of those who will come after, whose names will be deserving of marking the halls dedicated to them and their work, and whose names children of the future prosperous Jamaican nation will proudly bear? Could I just find 20 people who understand that things will never get better unless I can find these 20 people? And could those 20 people inbox me with the subject – Revolution!

On Twitter, there were markedly different responses to the editorial. ‏Samir King [3] didn't try to contain his sarcasm:

@persian__king [4]: #ChicagoTribune- #Jamaica the #Greece of the Western Hemisphere. The Prime Minister must be so proud.

Marlene Malahoo [5] thought the Tribune editorial was stating the obvious:

@oohalam [6]: Did we really need #Chicagotribune to tell us about the bad lesson of #Jamaica's irresponsible stewardship and its debt trap?

The Caribbean News Network [7] simply reported the political reaction:

@caribbeannewsuk [8]: #JAMAICA: Both poltical parties have united to criticise a #ChicagoTribune editorial describing the Jamaican economy as worse than Greece.

Kevin Edmonds, writing for the blog of the North American Congress on Latin America [9], suggested that last year the region was collectively trying to keep its head above water – and wondered what 2013 could have in store economically:

The ugly reality of austerity has rolled back much of the region’s social progress in healthcare and education—and we are witnessing an unparalleled spike of inequality, poverty, and crime. The majority of the spending for such services now is predominately debt driven and as such are unsustainable.

He cited Jamaica as an example:

Jamaica has come to symbolize how problematic a relationship with the IMF can become. Since the late 1970’s Jamaica has been stuck on a treadmill of debt, running at full speed, engaging in continuous borrowing, and repaying with massive amounts of interest while never getting ahead. In the 35 years the IMF has been in Jamaica, the country has devalued its currency numerous times, liberalized its tariffs, lowered taxes for corporations, created export-processing zones, slashed social spending, and privatized state enterprises. This has all resulted in higher levels of debt, less social services, little to no economic growth, and the collapse of Jamaica’s productive economy.

In response to the Chicago Tribune editorial, he wrote:

Jamaica is currently in the midst of deciding whether or not to negotiate a further round of payment restructuring. Instead of flying advisors from Washington to Kingston to provide advice on how to handle the crisis, perhaps the PNP government should be looking south towards Buenos Aries for ideas on how to deal with such unsustainable levels of debt.

While this will not happen overnight, there is a serious need for democratic renewal in the region.

The post dealt with other regional push factors – crime and its impact on human development, food security, trade liberalization, the erosion of basic social welfare programs, parallel drug-based economies. Edmonds continued:

The orientation of the region has led to a fracturing of both the domestic and regional economies. What is proposed is not an easy task, and it will take a collective effort. What Caribbean leaders need to do is establish a series of plans to tackle to most serious problems facing the region.

And if that fails, Annie Paul [2] provided a glimmer of optimism:

Its the young who will have to find ways to cauterize our debt wound. If there are enough like [her Facebook friend] Samuel Morgan around there is hope.