For the first time since the global economic recession of 2008, Jamaica recorded more than US$500 million in Foreign Direct Investment (FDI) inflows during 2013.
This is contained in the United Nations Conference on Trade and Development’s (UNCTAD) World Investment Report 2014 which was launched locally on June 24 by Industry, Investment and Commerce Minister, Hon. Anthony Hylton at the Knutsford Court Hotel in New Kingston.
According to the report, over the past two years, the country has been realising gradual recovery in the flow of inward investments since the recession, moving from US$218 million in 2011 to US$490 million in 2012, and US$567 million in 2013.
Minister Hylton pointed out that Jamaica’s performance speaks to “the important gains we are making as a country to bring our fiscal house in order and to construct a solid infrastructure for investments that will benefit current and future generations of Jamaicans”.
The Minister further noted that the Government has been improving the investment climate in Jamaica, through measures currently being implemented under its economic programme.
These activities include : tax and public sector reform; pension reform; debt management; establishment of a central treasury management system; and corporate governance.
This has led to improvements in Jamaica’s credit ranking, from ‘CCC’ to ‘B-’ by Fitch Rating Agency.
The Minister attributed the credit rating improvement to “strong corrective policy and compliance” during much of 2013, under Jamaica’s US$958 million Extended Fund Facility (EFF) with the International Monetary Fund (IMF).
He said this development means that the country’s risk profile has been reduced, therefore opening up the economy to attract more foreign direct investments, and to stimulate economic growth.
“It means that the global investment community is sitting up and taking notice of our commitment to fiscal discipline and macro-economic stability,” he said.
The Minister said it also signifies that the country has won credibility, “as we make the painful adjustments to keep our expenditures in line with our fiscal targets, contain inflation within the agreed targets, increase our international reserves, to reduce our debt to Gross Domestic Product (GDP) from 147 per cent of GDP to 139 per cent; and to continue meeting our primary surplus and budget balance targets”.
The World Investment Report 2014 focuses on how corporations can contribute to the realisation of the post-2015 Sustainable Development Goals, through additional and innovative financing, investment and responsible business practices.
The annual World Investment Report presents the latest trends in foreign direct investment, providing key economic intelligence for policy makers.
By Alecia Smith-Edwards