Business, Investment and Economics

My Two cents: What really is the purpose of the Economic Growth Council (EGC) of Jamaica?

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It doesn’t take an economics pundit to see through the fluff which surrounds the Economic Growth council of Jamaica. Its membership for one, right off the bat, tells you that this isn’t a unit seriously concerned about the ECONOMIC GROWTH of our country; but rather the LOOK of there being a special machinery in place for our economic growth. Let’s take an actual look at the council itself:

  1. Michael Lee-Chin, OJ Chairman, EGC
    Chairman, National Commercial Bank
  2. Ambassador Dr. Nigel Clarke Vice Chairman, EGC
    Dep. Chairman & CFO, Musson Group of Companies
  3. Hugh C. Hart, OJ Senior Partner, Hart Muirhead Fatta
  4. Patrick Hylton, CD Group Managing Director, NCB
  5. Noel Hylton, OJ, CD Noel Hylton and Associates
    Former Chairman, President and CEO, Port Authority of Jamaica
  6. Paula Kerr-Jarrett Director, Barnett Limited
  7. Pat Ramsay Cultural Consultant and Development Director
  8. Adam Stewart CEO, Sandals Resorts International
  9. Senator Kavan Gayle
    Representative from Jamaica Confederation of Trade Unions
  10. Phillip Gore Owner & Executive Chairman of Gore Developments Ltd.

You’ll notice, for the most part, it’s nothing but a group of businessmen, lawyers and Investors. And if you’re wondering about Dr Nigel Clarke, he has a doctorate in mathematics (not economics). Another thing which stands out for me is the lack of youthful exuberance on this council. If it’s expected that the youth of Jamaica are to be the successors of any efforts coming out of this project, then why aren’t we represented? Where’s the young economics student to offer a different (and more contemporary) perspective to the discussions on growth? And if this Council is in place then what then was the purpose of creating a Ministry of Economic Growth and Job Creation? Aren’t we kind of repeating ourselves here? hmm

There are a few people in society today that I’m surprised weren’t tall enough to get on this ride either. Dr K’adamwe K’nife, lecturer of entrepreneurship at the UWI Mona and sustainable development specialist would make sense as an addition to me; Dr Peter Phillips MP, former Minister of Finance and Planning (who also holds a PhD in International Political Economy and Development Studies I might add), and the only man who could offer insight on our growth over the last 4-5 years; Dennis Chung, CEO of the Private Sector Organization of Jamaica to guide offer insight on the structuring of that public/private partnership; Professor Trevor Munroe, Executive Director of the National Integrity Action (NIA) to advise the proper preventative measures for corruption control in the grand scheme of growth; and the list goes on.

What also concerns me is the overarching mission of this council with their “five in four plan” i.e 5% growth over the next 4 years. Is this even possible? Are they saying 5% cumulative growth by the year 2020, or in the year 2020 they expect to achieve growth of 5% after any given quarter? Below is a graph showing Jamaica’s economic growth trajectory over the last 4 years:

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As you can see for yourself, According to the Statistical Institute of Jamaica on a quarter-on-quarter basis, the GDP expanded 1.6 percent. GDP Annual Growth Rate in Jamaica averaged 0.58 percent from 2003 until 2016, reaching an all time high of 4.30 percent in the fourth quarter of 2006 and a record low of -4.50 percent in the second quarter of 2009. So if you really think about it, if they can replicate what was done between 2003 and 2016 and add 0.30%, 5% “growth” is possible. But will this really translate to socio-economic development? Rather, is this council AT ALL concerned with the socio-economic development of Jamaica or just boosting the numbers on paper? Because they are basically promising another 4 years just like the last 4 years (only a little bit better to account for the extra 0.30%). Is that what the Jamaican people would consider as growth?

A more believable approach to this would have been to extend the trajectory to about 15-20 years with a memorandum of understanding between the two political parties and civil society groups that just like the vision 2030 development agenda, this growth agenda would remain untouched. Notice also, that the current administration’s campaign for government was hinged on the promise of economic prosperity (growth) for Jamaica if elected. Also notice, that this 5 in 4 plan will conveniently conclude just in time for election season again? *hint*hint*

Finally take a look at the Economic Programme Oversight Committee (EPOC) and the newly convened Economic Growth Council (EGC). Notice any similarities? Why did they recreate the wheel that was the EPOC instead of adopt and reform it? Why is the chair of the EPOC, Mr Richard Byles, not even an honorary member of the EGC? *sips tea*

I want to end my rant with a word of advice to the powers that be reading this and may be feeling uneasy with the revelations: get over yourselves. The growth and development of Jamaica Land we love should not be a tactic to retain power and/or boost the aesthetics of the party which forms government; but rather a social partnership between ALL stakeholders of Jamaica (Rich, Poor and Young ) committed to the long term agenda for economic growth and prosperity. I would also implore the EGC going forward, to dialogue with the youth of our country and get them directly involved in this mission for economic growth. After all, whatever progress or decline that comes from this initiative will be OUR responsibility as youth to carry on. So it makes sense to give us a seat at the table.

 

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Business, Investment and Economics

Network Marketing and Entrepreneurship in Jamaica are NOT the same

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Network Marketing has become quite a phenomenon in Jamaica over the last 5 years; and probably even longer. It has presented a much easier way of achieving financial prosperity, and would even lead you to believe you can escape the woes of our economic reality with no strings attached, that so many Jamaicans are battling with daily. Before delving into this article, let me just set the record straight in saying I have nothing against network marketing and the people who engage this as their means of livelihood. I class it as I would any other legitimate income earning job in our society, and would even go further to endorse it in providing (especially to our unemployed,disenfranchised youth) a viable alternative to making a life in Jamaica; instead of the narcotics/drugs or scamming business. Where my reservations lie, however, is with the delusion that so many network marketers are under in believing so fervently that they are entrepreneurs because of what they do. Entrepreneurship and Networking Marketing might share similarities yes, but they are NOT the same.

wv11 wv15Entrepreneurship is a process whereby an individual(s) who sees an opportunity to create value, assumes the risk of organizing the factors of production (land/labor/capital) to create a product or service that offers that value; in exchange for profit. Network Marketing is a sales strategy in which a salesperson attends meetings of organizations whose members are likely to be interested in a particular product or service in order to develop a book of business. So essentially, Entrepreneurs create then sell whereas Network marketers identify then sell. But the biggest distinction between the two lies not in what each does, but rather the risk that each takes in doing what each is doing.

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To become a network marketer is similar to becoming a franchisee to a franchiser; just like the network of KFC fast food restaurants worldwide. The owner of a KFC restaurant in Downtown, Kingston cannot call himself the entrepreneur for KFC because the risk he takes in managing the franchise equates nowhere near to the risk the Franchiser took when the first KFC was founded in 1930. Harland Sanders, more popularly known as Colonel Sanders, saw the opportunity to create value for customers with his fried chicken and took on the financial risk of organizing all the labor, ingredients and facilities he would have needed at the time to produce and sell his fried chicken to the prospective customer base. The franchises that followed the birth of this first restaurant (the franchiser) already had the full risk of the venture minimized to a smaller investment due to the Colonel bearing that burden with the first undertaking in 1930. Essentially, all the back-end work of inventing the right mix of capital, ingredients and labor to produce the fried chicken has already been completed, and the role of the franchisee is to sell this product on behalf of the Colonel. I know you might be thinking that the investment to set up a restaurant as a franchisee and market the fried chicken to prospective customers is an argument to say that franchisees are still entrepreneurs; but I’m not trying to measure the extent to which one is more entrepreneurial than the other. I am saying the entrepreneur is the man who started it all; and anyone else who follows suit is just an ambassador of that entrepreneur. 

I chose this example to show you the difference between the marketer and the entrepreneur, in the grand scheme of network marketing. This is why I believe our Jamaican network marketers representing their respective international companies are seriously deluded to be thinking that the job that they are doing makes them an entrepreneur. What you are is just like the KFC franchisee downtown in my example above; someone selling another man’s fried chicken for a profit. Even if after a time of building your network around the product/service, it appears as if you can “retire” while your “employees” in your network make money for you, you are still an employee to a higher person in the network.  

While some network marketers may be earning upwards of USD $2000 (JMD $234,000) monthly from their “businesses”, I disagree with the view that because they are making so much money from selling a service they should still be considered “successful entrepreneurs”. For me, It’s the principles and processes behind that USD $2000 that should differentiate them from entrepreneurs. Where have they identified a need in the market that wasn’t already identified for them? How have they organized factors of production in a way that innovates on the existing formula by the Franchiser or is completely new? How much of the real risk of the venture are they bearing in their income statements?? To say they are still entrepreneurs even after that previous line of questioning is just like saying a graduate in Marketing from the University of Technology has acquired the same kind of education as a graduate in Marketing from the University of the West Indies. While the finished product, being the degree in Marketing is the same on paper, given the differences in environment, resource distribution and approaches to teaching; the applicability of each degree will naturally differ.

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Labels are very important, and I believe it saves a lot of us from sprinkling poison on our eggs instead of black pepper when making breakfast in the mornings. If you’re a network marketer, or considering to enter network marketing consider this post as another label to save you from the delusion that so many of your counterparts are currently in; but let it not discourage you from pursuing or continuing to pursue your dream to be a network marketer.

-G.B

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