Wilberne Persaud, Financial Gleaner Columnist

Foreign exchange trading is a burgeoning element of world financial activity. Its phenomenal growth results from multiple factors interacting as the concept of globalisation took hold of the imaginations of vast numbers of people.

I speak of globalisation taking 'hold of the imaginations'.

This description stems from the relationships and activities captured by the term 'globalisation' being, from a careful reading of history, nothing new.

This bit of historical reality cannot be over stressed. To discern this fact from the mountain of words written about modern day globalisation and its inevitability enables one to have a much better grasp and understanding of what is truly happening.

Global impact

So let's accept one fact: globalisation is not new. The phenomenon began with the rise of capitalism and colonialism. Its truly global impact today occurs in the arena of financial services. An important reason for this is the capacity that computers and computing, fibre optics, communi-cations, etc, have created to deal with unimaginable amounts of data in real time.

Partly also, financiers and their publicists and lobbyists have positions - put at its mildest - of influence in the world's leading economies through political systems that must accommodate policy to their wishes.

Oceans were always good separators of people and trade but man-made barriers were even better.

So the second enabling factor is the law governing these activities.

In a truly globalised world viewed from the space shuttle, inter-relationships between and among nation states would show a 'spider's web' of activity if one looks at our planet's trade in goods and services, investment and yes, labour movement flows.

The snapshot one sees is no spider's web of activity but huge flows among the rich countries and the burgeoning growth nodes - China and India, alongside some resource extractive activities among less developed countries.

The foregoing is merely the gist of what's going on.

With respect to foreign exchange trading, the kernel of the matter is that profits are there to be made. Once these circumstances continue and prevail, the trade shall continue. Margaret Thatcher once said in reference to Hong Kong reverting to China and her perception of the coming fall of communism in China: "The Chinese are born traders". It seems to me, to be a bit stronger than she claimed: humankind is a trading life form.

But to the problem at hand: the attitude of the Jamaican government to foreign exchange trading by institutions on behalf of 'consumers' or the public is formed by several factors that constrain both its behaviour and in some instances its thinking and conception of the problem.

Here's a start-up list:

1.	It is evident though never publicly admitted that both PNP and JLP administrations hold at least a suspicion that forex traders are somehow associated with money laundering.
2.	The Bank of Jamaica worries constantly that free forex trading would disrupt its monopoly hold on oversight and management of Jamaica's sparse foreign exchange reserves. Its view continues to hold that the activity would cripple its ability to manage the currency, money supply and inflation. This fear put simply and starkly is that its role would be marginalised. The Irony is that massive amounts of foreign exchange never pass a BOJ window.
3.	The multilaterals, Europe, and the United States all worry about money laundering and Jamaica must respect their wishes in its policies.
4.	Competition for business in Jamaica leads to strange bedfellows, relationships and economic decisions.
5.	Mechanisms for funding terrorism and illicit drugs are thought to be assisted by the freedom of financial transactions that forex operations generally can allow. Jamaica is not only a popular destination for tourists; it is completely accessible to the world. And for its existence must remain so. This presents real and potential problems that must be dealt with.
6.	There appears to be a blinkered vision of possibilities for dealing with this problem.

As a general rule it should by now be accepted by all that if a profit making activity exists and operates underground, once it is not destructive of human dignity as for instance, child pornography or human trafficking, it is best to find a way to legalise and control it. This is not an absurd view. Are we never going to learn the powerful lessons of prohibition in the US?