Minister of Finance and Planning, Dr. the Hon. Peter Phillips, says that as Jamaica embarks on the next phase of its journey as an independent state, the fundamental challenge will be to lay the foundation for a new economic architecture to advance sustained development.
The Finance Minister was addressing scholars, government officials, members of the diplomatic corps, the business community and academia from across the region, at the opening of the University of the West Indies (UWI), Sir Arthur Lewis Institute of Social and Economic Studies’ (SALISES) '50-50 Conference 2012' held on August 20 at the Jamaica Pegasus Hotel in New Kingston.
He said that critical to this new economic design is sharply reducing the burden of public debt to create room, in the medium-term, of more sustained social investments and capital expenditure. Reducing the debt, he said, will require substantial and sustained fiscal reforms, including, but not limited to, tax reforms, aimed at broadening the base of tax payers and reducing rates, and ensuring simplicity and efficiency and basic fairness in the tax system.
Also fundamentally important, he said, is the need to strengthen compliance and enforcement capacity in tax administration. “At the heart of much of the cynicism with which the public views public administration and politics is the sense that our tax system is fundamentally unfair and that those least able to pay are carrying too great a share of the burden of taxation,” he pointed out.
Dr. Phillips stated that public sector transformation must be an indispensible element in the new fiscal environment, to reduce relative cost of operating the public service, while ensuring greater efficiencies and more competitive remuneration for employees, over the medium-term.
The Minister also cited the critical importance of addressing those factors, which diminish the competitiveness of the productive sector, and creating a more enabling environment for business operations.
These, he said, could include, shortening the time and complexity involved in company registrations, securing development approvals, registering mortgages, and effecting land transfers.
Dr. Phillips, who spoke on the topic: ‘Caribbean Independence: Past, Present and Future – A Reckoning’, noted that the region, including Jamaica, has had many successes over the last half a century, with social progress being steady and measured. He noted that there have been major accomplishments in the areas of health, education, culture, sports and politics.
The Minister however remarked that along with these many successes the region has had to face equal failures and challenges, particularly in the areas of crime and economics.
He admitted that, “Jamaica is now at a point where the debt is unsustainable”.
He pointed out that with a debt to Gross Domestic Product (GDP) ratio of approximately 130 per cent, the country risks isolation from global capital markets, and is confronted by the prospect of a sharp reversal of such social gains that have been made, as an increasingly large share of revenues is spent on debt service, rather than on the capital investments or social expenditures necessary to sustain the improvements in social conditions.
Dr. Phillips noted that this debt crisis is a predicament across the Caribbean, with the exception of only Trinidad and Tobago, and maybe Barbados, to some extent.
He informed that across the region, debt has been moving up into the region of 100 per cent of GDP and more, and “all the historical research shows that you fall into a modern version of the debt trap, once your debt to GDP ratios exceed 90 per cent”.
"This is a collective failing, if you will, or certainly a collective challenge, which has to be confronted as we move forward into the first decade of the next 50 years,” Dr. Philips remarked.
The conference, which is being held from August 20 to 24, under the theme: “50-50 Critical Reflections in a time of uncertainty”, aims to analyse the region’s social and economic issues over the last 50 years, even as the Caribbean celebrates the golden jubilees of Jamaica and Trinidad and Tobago.
The four-day SALISES 50-50 Conference is expected to provide a forum where the last half-century of independence in the Commonwealth Caribbean will be discussed. In particular, discussions will focus on the countries of Jamaica and Trinidad and Tobago, analysing the successes and failures, the best and worst practices, and possible solutions to the region’s myriad of problems.
Guest speakers will include Prime Minister of St. Vincent and the Grenadines,
Dr. Ralph Gonsalves; Leader of the Opposition in Jamaica, Andrew Holness; Chancellor of the UWI and former Director of the Pan American Health Organisation, Sir George Alleyne, United Kingdom Member of Parliament, Diane Abbot; professors emeriti of UWI, Norman Girvan and Selwyn Ryan; and historian Professor Verene Shepherd.
For more information on the conference visit: http://salises5050conference.com