Thousands of jobs have been generated and dozens of new companies created in Jamaica in the last four years in Jamaica as a result of the country’s embrace of the Global Services Sector (GSS) project, said permanent secretary in the Jamaica’s Ministry of Industry, Investment and Commerce Sancia Bennett Templer.
The senior Jamaican public servant was speaking on the second day of the inaugural Caribbean Services Exporters Symposium hosted by the T&T Coalition of Services Industries (TTCSI) last Wednesday.
Bennett Templer referenced GSS, which is a project funded by the Inter-American Development Bank (IDB).
“The impressive growth of Jamaica’s global service sector is further underscored by the success of the Global Services Sector project, a pivotal five-year initiative funded by the Inter-American Development Bank (IDB). This project aims to create a highly skilled workforce as we seek to advance along this value chain. This enhanced workforce, particularly in high-value-added roles, plays a pivotal role in fortifying Jamaica’s ability to attract investment and boost its exports,” she pointed out
Bennett Templer said over the past four years in the north Caribbean country, the GSS has experienced significant growth, with the number of GSS firms and employees steadily increasing.
According to her statistics, since 2018, approximately 62,000 individuals have been employed in this sector. In 2018, there were 60 established GSS entities, since then, this number has risen to 91, reflecting an impressive 51.67 percent increase in the span of four years and this expansion underscores the sector’s dynamic growth and its pivotal role in global service delivery.
She added that these 91 operators comprise both Jamaican and international firms, collectively operating across 112 sites throughout Jamaica.
Notably, ten Fortune 500 companies are among them, extending their services to markets in Canada, the Caribbean, China, the USA, Europe, and their geographic reach spans across all parishes in Jamaica, she said.
She also said the reach and impact of these GSS operators extend far and wide, encompassing a multitude of industries including, but not limited to, retail, technology and media, financial services and insurance, medical, legal, public sector, education, professional services, travel and tourism, and healthcare. The services offered are as diverse as the industries served.
She added that this growth in global service organisations is more than just a job creation strategy.
“It is a strategic driver of economic growth, supported by the transformation of contact centres into hubs for a wide array of valuable services. This development fosters a robust career pathway, underpinning Jamaica’s march towards economic progress and global competitiveness.”
At an IDB conference last week, Jamaica’s Finance Minister, Nigel Clarke said the island’s recent economic performance is the best ever.
Speaking at the opening session of the IDB’s Sub-Regional Policy Dialogue on Ecosystems of Entrepreneurship and Innovation in the Caribbean Region in Jamaica on Wednesday, Clarke cited, among the indicators, the country’s robust foreign exchange reserves, low unemployment rate, low debt to gross domestic product (GDP) ratio, as well as sustained periods of growth.
“Jamaica, today, has macroeconomic fundamentals that represent the best that we have ever had. Our foreign exchange reserves are US$4.7 billion approaching US$5 billion, greater than it has ever been, and is up 56 per cent from the COVID-19 pandemic.”
“Our unemployment rate is at the lowest level it has ever been, at 4.5 per cent, with 148,000 jobs created over the past seven years and we have recovered from the pandemic in terms of output. To top it off, our debt is the lowest it has been in approximately 25 years,” he added.
The Minister noted that Jamaica has recorded 20 consecutive quarters of positive economic growth, pointing out that the Government is working to ensure that “the periods of growth that you have are longer and longer.”.
Clarke noted that the Government has implemented deliberate strategies and policies to support small and medium-sized enterprises (SMEs), with the country recording an 11 per cent increase in the number of registered companies in 2022.
Over 5,400 entities were registered last year with the Companies Office of Jamaica (COJ).
“We have never had as many companies formed in Jamaica as in the current era. A lot of it is due to the macroeconomic environment that exists, which is extremely positive, where stability is entrenched, and people have an optimistic view of the future. But it is also due to the vibrant ecosystem that we are creating in Jamaica,” Dr Clarke said.
He noted that a lot of the support to SMEs is being provided in partnership with the IDB, through the Boosting Innovation Growth and Entrepreneurship Ecosystem (BIGEE) project, accelerator and incubator programmes, a patent grant fund, angel investors funds, and private equity funds, among other inputs.
“The ecosystem that we have supported and nurtured is worth $13 billion… for equity investment, to support innovation and entrepreneurship in Jamaica,” the Minister said, pointing out that the abolition of the minimum business tax and the asset tax further served to assist thousands of entrepreneurs.
“Never before in Jamaica’s history has so much equity been available for… entrepreneurial or innovative companies in Jamaica,” Dr Clarke pointed out.
T&T’s experience
Deputy Permanent Secretary, Ministry of Trade, Ava Mahabir-Dass believes that T&T’s past economic problems have shown the importance of having a strong services sector when other sectors like energy are not performing well.
“Recent economic and international developments have forced us to re-examine our approach to the growing services trade. It was not long ago, just in 2015 that T&T’s economy faced exceptional difficulties due to the collapse of oil and gas prices the previous year. Then there was the pandemic in 2020, followed the Ukraine and Russian War,” she said.
Mahabir-Dass, who also spoke during day two of the Exporters Symposium lauded Jamaica’s successes in the services sector.
She also said that the services sector is more resilient to international shocks than other sectors.
“Among the lessons learned in the last few years is that services trade is quite resilient to global shocks as evident by the rise of digitally delivered services when everyone was continuing to be at home during the pandemic. Also evident, is that many of our service providers did not have an online presence or if they did, it was well suited for commercial activity rendering many of them unable to sell online. With this in mind, the Government has recognised that in order to capitalise on the potential opportunities that trade in services provide, a new roadmap of targeted intervention is needed,” said the senior public servant.
She said a major key to achieving the desired services trade performance is the development of effective policy that improves coherence and defines effective targets.
“This increases confidence in the business community demonstrated by the Government’s commitment to the sector. One of T&T’s priority projects is the development of the Trade Policy 2024 which will include a substantial section which details a strategic plan for the enhancement of trading services. This policy will compliment the work that is being done within the region to develop the services sector. The rise in digitally delivered services also has influenced our decision to accelerate efforts to further update the national e-commerce strategy. E-commerce is an important accelerator of economic activity.”
She also said the Government was doing its best to provide financing to those businesses that want to get into exporting services.
“At the Ministry of Trade, grant funding facilities have been established to aid the Micro, Small and Medium businesses (MSME) in the yachting sector as well as aspiring film makers. We have learnt that effective marketing can be expensive and even daunting and SME’s often appropriate only a small portion of their budgets for promotional activities. However, potential benefits of the increased international exposure for targeted exports promotion cannot be overlooked.”
She added that the services sector will continue be part of the Government’s long-term plans.
“The services sector has always been an important part of the Government’s strategic plan for T&T.
“We have long recognised the potential and positive impact and long-term economic growth partially due to its interconnectedness with other sectors as well as with labour intensive companies. The increasing importance of this sector is made evident by global trends which show that growth of trade in services is continuing to outpace of global trading goods.”