You’re in the business of manufacturing or maybe you’re an exporter, how do you weather recent threats of a recession both locally and internationally? Joining me now to discuss how prepared both the manufacturing and export sector is to combat a global recession we have Senator the Honourable Aubyn Hill, Minister of Industry, Investment and Commerce.
Minister of Industry, Investment and Commerce, Senator Aubyn Hills says local manufacturers must begin to boost their export operations if they want to survive a possible US recession.
Speaking on MoneyMovesJa with Kalilah Reynolds, the Minister said that a recession in the United States will have some impact on Jamaica’s economy.
A recession is defined as two consecutive quarters of negative economic growth. Analysts in the US are predicting a recession in that country by 2023, as the country grapples with raging inflation among other economic issues.
“A recession in the market of your biggest trading partner is always going to affect you,” he said.
Senator Hill noted, however, that there is a large Jamaican population in the US that may keep the country’s export market open.
“The diaspora will continue to buy the local products that they really can’t get anywhere else, so those will continue to sell,” he said.
According to the Minister boosting exports is the best way to grow the island’s economy.
“We have three million people and we have a GDP per capita of less than US$5000 per person. Therefore, there is no way we are going to become a rich country selling to three million relatively poor people,” he explained.
He said while the United States is one of Jamaica’s major trading partners and a recession there would affect export, there are other markets that can be explored.
In the meantime, Senator Hill said that local investors and manufacturers have to invest in modernising their manufacturing practices to compete in the international markets.
He acknowledged that the current energy crisis has hampered local manufacturers. Energy prices, which were already high due to the COVID-19 pandemic, have skyrocketed since the start of the war in Eastern Europe.
The Minister said that the government is working on creating an energy solution that will grant manufacturers power from the nation’s grid at a lower cost.
Hill said that while he hopes that all manufacturers and export will be able to sustain themselves during a period of economic downturn, the reality is that many will have to make concessions.
He added that some companies may, unfortunately, have to shutter their business for a period of time until the economy recovers.
Visit EXIM Bank’s Business Advisory Service at:
https://eximbankja.com
