After four decades of little or not growth, the Jamaican economy is expected to grow at 1-2% over the medium term. The country is confronted by serious social issues that predominantly affect youth, such as high levels of crime and violence and high unemployment.
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Nicaragua is the first Central American country to sign up to the insurance WASHINGTON, April 18, 2015 - The Council of Ministers of Finance of Central America, Panama and the Dominican Republic ... Show More +(COSEFIN) and CCRIF SPC (formerly the Caribbean Catastrophe Risk Insurance Facility) signed today a memorandum of understanding that enables Central American countries to formally join the facility to access low cost, high quality sovereign catastrophe risk insurance.During the ceremony, CCRIF SPC and the Government of Nicaragua also signed a Participation Agreement for Nicaragua to become the first Central American country to formally join the facility. Other member nations of COSEFIN are expected to join CCRIF SPC later this year and in 2016.“For Nicaragua, it is an honor to be the first member of COSEFIN countries to join the CCRIF. This insurance will allow us to strengthen financial resilience to natural disasters and continue our efforts to reduce poverty and respond to climate change challenges as part of our National Human Development Plan,” said Ivan Acosta, Minister of Finance of Nicaragua.Nine countries in Central America and the Caribbean experienced at least one disaster with an economic impact of more than 50 percent of their annual gross domestic product (GDP) since 1980. The impact of Haiti’s earthquake was estimated at 120 percent of GDP. The same year, tropical cyclone Agatha, in Guatemala, had devastating consequences and poverty rates increased by 5.5 percent. Climate change also represents a significant development challenge, with average annual economic losses due to weather-related disasters amounting to 1 percent or more of GDP in ten Caribbean countries and four Central American nations, including Nicaragua.Established in 2007, CCRIF is the world’s first multi-country catastrophe risk pooling mechanism which offers sovereign insurance at affordable rates to its members against hurricanes, earthquakes and excess rainfall. Currently, 16 Caribbean countries are members of CCRIF.The facility enhances the fiscal resilience of its member countries to catastrophes caused by natural hazard events by providing immediate financial resources in the aftermath of a disaster, allowing governments to better respond to the initial needs of their populations and continue providing critical services. Since its inception, CCRIF has made twelve payouts totaling US$35.6 million to eight member governments. All payouts were transferred within two weeks after each event.“After exploring options for engaging in sovereign disaster risk financing, Central American countries concluded that joining the CCRIF SPC facility was the most efficient and cost-effective insurance mechanism to pool our risk”, said Martín Portillo, Executive Secretary of COSEFIN. “This will allow us to reduce our countries’ fiscal vulnerability to the adverse effects associated with earthquakes, tropical cyclones, excess rainfall and other events.”This new 23-nation partnership will benefit both existing and new CCRIF members, providing low prices due to more efficient use of capital and insurance market instruments. New members will be able to take advantage of CCRIF’s low premium costs and existing members could realize premium reductions due to the increased size of the CCRIF portfolio. This partnership between Caribbean and Central American countries could strengthen economic engagement throughout the greater Caribbean Basin.“We foresee a range of benefits to both regions emanating from this partnership,” said Milo Pearson, Chairman of CCRIF SPC, “including the creation of a strategic mechanism in which Caribbean and COSEFIN countries can share best practices in disaster risk management and learn lessons from each other in advancing collaborative approaches to reducing vulnerabilities to hazards, alleviating poverty, enhancing debt and financial sustainability and creating a framework for the sustainable prosperity of the countries of both regions.”The World Bank provided the initial finance and technical advisory services to establish CCRIF in 2007 and in 2014 the Bank supplied resources to finance entrance fees to CCRIF for Honduras and Nicaragua, as well as annual insurance premiums for four years.“This a real example of a regional public good where collective action has clear financial benefits and can help countries tackle the adverse impacts of climate change,”, said Jorge Familiar, World Bank Vice President for Latin America and the Caribbean. “We look forward to deepening our engagement with COSEFIN, CARICOM and CCRIF as part of this ambitious regional initiative.”About CCRIF SPCCCRIF was developed under the technical leadership of the World Bank and with a grant from the Government of Japan. It was capitalized through contributions to a multi-donor Trust Fund by the Government of Canada, the European Union, the World Bank, the governments of the United Kingdom and France, the Caribbean Development Bank and the governments of Ireland and Bermuda, as well as through membership fees paid by participating governments. Show Less -
Average Latin America and Caribbean Growth Down to 0.8 Percent This YearAbsent Structural Reforms, Future Growth May Remain LowLesson Learned: Domestic Saving Can No Longer Be OverlookedWASHINGTON, Ap... Show More +ril 15, 2015 – With China growing at a more moderate pace and commodity prices stabilizing at lower levels, Latin America and the Caribbean will need to adapt to a “new normal.” Average GDP growth in the region, slowing down steadily and sharply since 2011, is expected to reach only 0.8 percent this year, and may remain at low rates in the future unless ambitious pro-growth structural reforms are adopted. A boost in savings, which would need to be a key ingredient in a pro-growth agenda, would also help rebuild monetary and fiscal policy maneuvering space.In its latest semiannual report, “Latin America Treads a Narrow Path to Growth: The Slowdown and its Macroeconomic Challenges,” the World Bank´s Office of the Chief Economist for Latin America and the Caribbean forecasts a fourth year of slow growth for the region. The report concludes that the strong growth of the 2000s is not likely to revisit the region, unless vigorous pro-growth reforms are adopted. “The evidence suggests that the external shocks emanating from China’s deceleration and terms of trade changes are permanent,” said Augusto de la Torre, World Bank Chief Economist for Latin America and the Caribbean. “In the absence of growth-friendly structural reform, this situation firmly points in the direction of an also permanent growth slowdown for the region, with rates that would be insufficient to support significant social progress.”Beyond averages, the region continues to tell a widely diverse story. Commodity exporting countries in South America are growing at a much slower pace than commodity importers in Central America and the Caribbean. Especially hurting among the exporters is Venezuela with its economy expecting to shrink again by 5 percent in 2015. Also in negative territory would be Brazil and Argentina, countries with very different realities but both pulling the regional average down due to their larger size. This year the slowdown is expected to hit other South American commodity exporting countries, such as Bolivia, Colombia and Ecuador, which had delivered relatively strong growth through 2014. Meanwhile, commodity importers in the region are benefitting from lower prices and will see growth in 2015 above the regional average, with particularly strong growth rates expected for Panama, Nicaragua, and Dominican Republic. Mexico, benefitting from the US recovery, is expected to grow this year also above the regional average.The report, issued ahead of the World Bank Group and IMF Spring Meetings, finds that Latin America and the Caribbean decelerated more than all other emerging regions. This reflects the amplification effects of an unusually strong decline in investment among commodity exporting countries in the region.In this less favorable external environment, leaders in Latin America are facing diverse policy response options to stimulate their economies. Commodity importers, such as the countries of Eastern Caribbean, will have an easier path given lower commodity prices and U.S. economic recovery. Commodity exporters with little exchange rate flexibility will likely face a much harder time, as the transition to the “new normal” will have to rely on a significant reduction in aggregate spending.“Hindsight is 20/20. But we can say now that both the private and public sectors in many countries in the region interpreted the change in the external environment, and hence the nature of the deceleration, as transitory. This resulted in continued expansions in spending even as income growth was declining, which ended up reducing monetary and fiscal maneuvering space,” said de la Torre. “Looking forward, it is now clear that adopting policies to stimulate savings will be important to strengthen the foundations for growth and macroeconomic stability. This is a tall order that will take time, but it will show that we learned from our experiences.” Currently, Latin America’s savings rates stand at about 10 percentage points below Asia’s. According to the report, higher saving rates would provide more breathing space for both monetary and fiscal policy. In addition, there is increasing evidence that savings can promote growth by both underpinning a more depreciated real exchange rate, and reducing the dependency on foreign savings. Both, in turn, would boost external competitiveness, and reduce the cost of capital, respectively, enhancing the sustainability of growth. The evidence shows that countries that save more, have more competitive exchange rates, export more, and grow more.Learn more about the work of the World Bank in Latin America and the Caribbean: www.worldbank.org/lac Visit us on Facebook: http://www.facebook.com/worldbankBe updated via Twitter: http://www.twitter.com/BancoMundialLAC For our YouTube channel: http://www.youtube.com/lacregion2010 Show Less -
For Minister Robinson Start Up Jamaica contributes to the realisation of Vision 2030 by linking the youth passion for ICT with entrepreneurship’s potential to build the local economy.Since the incepti... Show More +on of the Start Up Jamaica incubator in September 2014, six companies have piqued Oasis 500’s interest, attracting offers of investment. Three of them have just accepted the offer and will go to Jordan in April for a 100 –day acceleration program:Crimebot: With the 6th highest homicide rate in the world, crime and violence represents a significant challenge for Jamaica. Crimebot (winner of the Grand Prize at Digital Jam 3.0) provides users with live updates of incidents in their vicinity, through notifications, hot-spot illustrations and the anonymous submission of crime reports.”It shows how hard work really pays off,” explains Gareth Thompson from Crimebot. “It’s shocking to show how our idea is actually becoming a reality. I’m really ecstatic about it.”RevoFarm: Agriculture makes up close to 7% of Jamaica’s GDP but it is highly vulnerable to the effects of climate change. RevoFarm is designed to make it easier for farmers to grow and sell their produce, alerting them to new trends, climate-smart farming practices and helping them to share recommendations between users.Vinelist: For centuries shoppers have gone to the shopkeeper to buy whichever items they were looking for. The Vinelist reverses this relationship. A social shopping platform, now the merchants come to you.“In Jamaica there is a lot of enthusiasm and energy, but with the start-up space in its infancy, mentorship is scarce and experience limited,” says Mannin Marsh from VineList. “We are anxious to tap into the Jordanian experience to enable us to grow both locally and internationally.”In 2012, mobile app revenues topped US$18 billion worldwide and it’s a market which is ever growing. The Digital Jam series shone a spotlight on the prodigious talent of the Caribbean’s youth, impressing representatives from some of the world’s top digital companies.“Our business at Oasis500 is to use our angel investor and mentor networks to nurture creative ideas in Information Technology, Mobile and Digital Media and transform them into startup companies. We consider this initial investment via Start Up Jamaica to be a great milestone along what has so far been a successful journey for Oasis 500, and I expect nothing but greater success moving forward.” Hamidaddin concludes.With this investment from Oasis 500, the future is surely digital in Jamaica. Show Less -