More farmers, like these, need greater access to finance capital.
Julian 'Jingles' Reynolds, Contributor
IF JAMAICA'S socio-economic development is to show any significant progress in the immediate future, access to finance capital for the new emerging entrepreneur class must be given top priority by the Government and financial institutions.
The one year that I have returned to live in Jamaica focusing on the development of my company's agro-industrial project in Spring Garden, Portland has not only educated me in many things, but has confirmed many widely held perceptions.
The traditional requirements of land, stocks, cash, machinery, gold, silver and precious stones; assets used to collateralise business loans from financial institutions are in most cases not held by those seeking financing. The result is that those with the original ideas for developmental projects and possessing the will, energy and passion to execute these projects are unable to do so.
This denial of access to finance capital sustains the status quo, affording constant opportunities and privileges to the minority class (overwhelmingly light-skinned, white or Chinese) with access, while denying opportunities to others (overwhelmingly black) with limited or no access. This impacts negatively on employment possibilities nationally.
UNEMPLOYED
The result is 141,000, or about 15 per cent, of the national labour force are unemployed. And 76 per cent of those are between ages 14 and 34. Five hundred and twenty thousand, or 20 per cent, of Jamaicans live below the poverty line of $3,000 per week. Twenty per cent of Jamaicans control 80 per cent of the wealth leaving the remaining 20 per cent of the country's GDP to be shared by 80 per cent of the population. And these are the official statistics, if you do a reality check with the man or woman in the street, the statistics will be grimmer.
Lack of access to capital is not the only reason for socio-economic instability; poor leadership, bad management, egotism and arrogance, bad mindedness, rudeness, and ignorance are all contributing factors. On the other hand, discipline, sound education, the ability to reason through differences, courtesy, technical proficiency, better communication and hard work are all very necessary to generate productivity, build wealth and sustain social stability.
For Jamaica to make real progress, eliminating the causes of obscene poverty, poor education, high unemployment, low self esteem that inevitably and unarguably lead to excessive violence and wanton criminal acts, then people with workable ideas and projects that will have positive impact on the socio-economic conditions of this country must be afforded clear access to finance capital, disregarding class ties, political affiliations, and minimising the traditional requests for collateral. To do this, the Government must institute policies that the bankers and bureaucrats must adhere to, that are more creative and focusing more on the positive socio-economic impact of the project and its contribution to national development.
EXCESSIVE BUREAUCRACY
The Government as representative of the people must play a more proactive role in this process, aggressively becoming stakeholder for limited periods so as to give these projects a chance to develop. The government needs also to address the prohibitive taxes, high legal fees and excessive bureaucracy that accompany the transfer of property from one generation to the next. Land is the principal asset in wealth building and by making it difficult to own property, then wealth building is denied to many in this country.
The still high interest rate policy is also counter productive for sustainable development, and must be corrected speedily if the leadership in Jamaica is truly supportive of national development and progress for all Jamaicans. And my reference to leadership speaks to political, as well as civic and business leadership.
Another major hindrance to national development and real productivity is the excessive, burdensome and very frustrating bureaucracy that entrepreneurs still have to contend with in Jamaica. It is often posited that the bureaucracy is intended to thwart the Jamaican tendency to "beat the system." But while this may be applicable to a time past, too much bureaucracy in today's very competitive, fast-paced information, communications and technological world is counter productive for the real players in the marketplace. Too often myopia rules in Jamaica: An enormous amount of time is wasted getting a required piece of document from a government office while work stops, workers are idle, products cannot get to market, and revenue is lost. Or a piece of document requires a signature of someone who has gone on vacation, or a long holiday weekend renders the application of the signature impossible, again leading to loss of a competitive edge. And by the way, Jamaica may be the only country that has two national holidays the same week.
The decision-making process for financing or approval for project implementation in this country is far too time consuming and in instances cavalier. The focus by the decision makers seems not to be on getting the project going, but on the documentation requested. For example, the demand by financial institutions for the entrepreneur to show 30 per cent equity in the project to attract further financing is prejudicial. This either kills or delays the project further, leading to non-employment, and in the case of agriculture or agro-processing, planting cycles or early entry into the market are missed, which can severely hamper the project's viability.
SINGULAR NATIONAL FOCUS
If we are to manifest the potential that our country continues to show in sports, culture and academia, then we must all have a singular national focus, a firm commitment for doing all that is possible to making socio-economic advancement for all Jamaicans a reality. The tendency of safeguarding profit and a nice life for a few because they have access to capital without much hassle, is not in the best interest of Jamaica, and therefore must be replaced with an all-inclusive, all-encompassing attitude. True democracy speaks not only to political democracy, but should demonstrate economic democracy- access, equity and parity for all in the country's economic life. Our late Prime Minister, Michael Manley, believed this passionately.
Arresting economic viability in one class of people may provide an advantage to those who control capital and wealth, but far more what it does is stifle development for many, leading to enmity and hostility. Nation building comes when opportunities also exist for the least privileged among us. And access to finance capital is the single most important asset for providing opportunity and nation building. The true wealth of this nation does not lie only within the geographic boundaries of Jamaica, but today, more so, throughout the world. The world is our marketplace, and we all must band together to tap this lucrative marketplace. Imagine what Jamaica would be if Bob Marley did not get the opportunity to expose his potential to the world.
A sense of urgency is needed in Jamaica to address this socio-economic imbalance that is the root cause of the vast majority of the crimes committed in Jamaica today: There has always been a direct correlation between crime and violence and lack of economic opportunities. And if you think otherwise, then you need only to revisit Oliver Twist.
I am not saying that Jamaica is a worst case scenario. Conditions are bad in some cases, rotten in a few, but overall Jamaica remains very viable. What I am arguing is that the full potential of this country is not being met, because of serious inequities that foster hopelessness, lawlessness, failure and self-destruction among too many of our citizenry.
Julian 'Jingles' Reynolds is chairman and chief executive officer of Anything From Jamaica, Ltd. (a Jamaican company) and Edeler Holdings Corp. (a New York-based company), and president of Fiwi Productions and Marketing. He has been a contributor to The Gleaner for 38 years.
