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Manufacturing and Export; Key Challenges and The Way Forward In Supporting Sustainable Development (January, 2021)

Theme: Towards Sustainable and Inclusive Economic Development – Adaptation and Agility in the Post-COVID era

The year 2020 was one of unprecedented challenges triggered by the onset of the COVID-19 pandemic, plunging multiple sectors including manufacturing and export into a state of uncertainty. Businesses, specifically Micro, Small and Medium Enterprises (MSMEs) across varying sectors were some of the hardest hit. Many grappled with challenges such as inadequate liquidity, complete loss of or decrease in the local market, loss of access to international markets, loss of access to external finance, as well as increased cost of raw material. A series of COVID-19 impact assessments conducted by the JMEA revealed additional challenges which affected output, operational structure, and overall financial outlook.

Nevertheless, despite the challenges brought on by the global pandemic, the manufacturing and export sectors proved resilient. Through its advocacy, the JMEA was integral in ensuring that the Bank of Jamaica (BOJ) had flash auctions of foreign exchange for exporters during the shortages caused by the closure of the hotel industry. Additionally, the JMEA secured a 50 per cent reduction in Jamaica Agricultural Commodities Regulatory Authority (JACRA) fees for exports, which reduced the cost of exporting for many companies. Furthermore, the Association advocated for local producers of hand sanitizers by demonstrating to the Government the capacity of our manufacturers to supply local demand, thus leading to the end of the waiver for imported hand sanitizers on December 31, 2020.

COVID-19 has taught us many lessons, including most of all, the need for a diversified and robust economic landscape driven by innovation, productivity, development of high value-added products, boosting of exports and improving of linkages with the services industry. Now more than ever, delivering the Sustainable Development Goals (SDGs) for Jamaica requires an environment which fosters improved growth of our productive sectors.

Inclusive and sustainable development can only be achieved if the necessary steps are taken to promote a strong and robust manufacturing and export base. Achieving the SDGs and Vision 2030 Jamaica, our own national goals, will require a joined-up approach and the unwavering collaboration of all stakeholders in addressing the many issues facing the productive sectors.

As we move forward, priority focus must be given to the manufacturing and export sectors to achieve sustainable resilience, recovery, and growth. The National Manufacturing Growth Strategy and the 10 Point Export Plan, both resulting from stakeholder collaboration, provide strategic areas for intervention in both sectors.

The Strategy envisions an empowered manufacturing sector that will provide a predicted output of $81 billion and 97 898 jobs by the year 2025. Key elements include, educational reform (improvement in skilled workforce), development of capacity building programmes, cluster development programmes and public private partnerships. Additionally, the 10 Point Export Plan cites key areas of focus such as development of tax relief infrastructure, policy reform, boosting logistics and improving support for MSMEs (capacity building/access to finance) which if achieved, can chart the road ahead in generating a positive impact of estimated 0.5–1.0 per cent to the country’s GDP. 

As detailed in the National Development Plan, our aim is to spur the creation of a “A dynamic, vibrant, market led manufacturing sector making high value-added world-class products desired by consumers across the globe.” Now more than ever, steps must be taken to ensure that the productive sectors are enabled to effectively respond to the challenges and opportunities of the current environment.

Written By: The Jamaica Manufacturers and Exporters Association (JMEA)

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