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Economy of Jamaica

Jamaica's economy is improving in the wake of the global recession, but still faces serious long-term problems: a sizable merchandise trade deficit, large-scale unemployment and underemployment, and a debt-to-GDP ratio of almost 130%. Structural weaknesses, low levels of government infrastructure investment, and high-cost energy erode confidence in the productive sector. High unemployment exacerbates the serious crime problem, including gang violence that is fueled by the drug trade. Jamaica's onerous debt burden--the fourth-highest per capita--is the result of government bailouts to ailing sectors of the economy, most notably the financial sector in the mid-to-late 1990s. The government faces the difficult prospect of having to achieve fiscal discipline in order to maintain debt payments while simultaneously attacking serious crime challenges that are hampering economic growth. It also needs to address the high cost of energy to successfully expand the economy. The private sector complains sharply about challenges to doing business on the island, but the government appears unwilling to recognize these obstacles and resolve them. Although official statistics show decades of economic stagnation in Jamaica, economists at the World Bank (WB) and Inter-American Development Bank (IDB) have estimated substantial growth of the informal sector. Such studies suggest that inclusion of the informal sector would raise Jamaica’s GDP statistics by as much as 40%. The country's economy is heavily dependent on services, which now account for more than 60% of GDP. Jamaica continues to derive most of its foreign exchange from tourism, remittances, and bauxite/alumina. Remittances account for nearly 20% of GDP and are equivalent to tourism revenues. Remittances dipped 15% from 2008 to 2009, but have recovered and are near where they were before the global economic downturn. Three of Jamaica’s four bauxite/alumina firms suspended operations in 2009 due to falling demand amid the global economic downturn. Only one of the three had restarted some operations as of August 2010. Inflation rose to 11.7% in 2010 as a result of high prices for imported food and oil; inflation was 10.2% in 2009 and 16.8% in 2008. Jamaica took two significant steps toward improving its economy in January and February 2010. The first was the Jamaica Debt Exchange (JDX), in which the country retired 350 high-priced domestic bonds and replaced them with 24 new bonds at lower rates of interest of about 12.5%. This helped reduce the debt servicing costs for Jamaica by about $450 million per year and provided the country with some fiscal relief. Second, the Government of Jamaica signed a U.S. $1.27 billion, 27-month Standby Arrangement with the International Monetary Fund (IMF) to support the country's economic reforms and help it cope with the consequences of the global economic downturn. Despite these moves, the government has limited spending available for infrastructure and social programs, since debt servicing still accounts for a substantial amount of government expenditures. The government has largely divested itself of Air Jamaica via a sale to Caribbean Airways. It also sold off former sugar estates, and is in the process of divesting its share of a major bauxite operation. These are notable successes, but there are still some former parastatals that need to be privatized. GDP $13 billion (2010 est.); $12.6 billion (2009). Real growth rate: -3% (2009); -0.6% (2008); 1.4% (2007). Per capita GDP (2009): $4,500. Natural resources: Bauxite, gypsum, limestone, marble, sand, silica. Agriculture: Products --sugar cane, bananas, coffee, citrus fruits, condiments and spices. Industry: Types --tourism, bauxite and alumina, processed foods, sugar, rum, cement, metal, chemical products, ethanol. Trade (2009): Exports --$1.3 billion: alumina, bauxite, sugar, bananas, chemicals, citrus fruits and products, rum, coffee. Major markets (2005)--U.S. 37%, U.K. 15.5%, and Canada. Imports (2009)--$5.1 billion: fuels, machinery, transportation and electrical equipment, food, fertilizer. Major suppliers (2000)--U.S. 40%, Trinidad and Tobago 15.7%, Venezuela 9%, Japan 3%, China 3%, U.K. 2%, Canada 2%.

Geography of Jamaica

Area: 10,991 sq. km. (4,244 sq. mi.). Cities: Capital--Kingston (pop. 566,200). Other cities--Montego Bay (85,500), Spanish Town (112,000). Terrain: Mountainous. Climate: Tropical. Location: Caribbean, island in the Caribbean Sea, south of Cuba Map references: Central America and the Caribbean Area: total area: 10,990 sq km land area: 10,830 sq km comparative area: slightly smaller than Connecticut Land boundaries: 0 km Coastline: 1,022 km
Maritime claims:
continental shelf: 200-m depth or to the depth of exploitation exclusive economic zone: 200 nm territorial sea: 12 nm International disputes: none Climate: tropical; hot, humid; temperate interior Terrain: mostly mountains with narrow, discontinuous coastal plain Natural resources: bauxite, gypsum, limestone Land use: arable land: 19% permanent crops: 6% meadows and pastures: 18% forest and woodland: 28% other: 29% Irrigated land: 350 sq km (1989 est.) Environment: current issues: deforestation; coastal waters polluted by industrial waste, sewage, and oil spills; damage to coral reefs; air pollution in Kingston results from vehicle emissions natural hazards: hurricanes (especially July to November) international agreements: party to - Biodiversity, Climate Change, Law of the Sea, Marine Dumping, Marine Life Conservation, Nuclear Test Ban, Ozone Layer Protection, Ship Pollution Note: strategic location between Cayman Trench and Jamaica Channel, the main sea lanes for Panama Canal

Government of Jamaica

The 1962 constitution established a parliamentary system based on the U.K. model. As chief of state, Queen Elizabeth II appoints a governor general, on the advice of the prime minister, as her representative in Jamaica. The governor general's role is largely ceremonial. Executive power is vested in the cabinet, led by the prime minister. Parliament is composed of an appointed Senate and an elected House of Representatives. Thirteen Senators are nominated on the advice of the prime minister and eight on the advice of the leader of the opposition. General elections must be held within 5 years of the forming of a new government. The prime minister may ask the governor general to call elections sooner, however. The Senate may submit bills, and it also reviews legislation submitted by the House. It may not delay budget bills for more than 1 month or other bills for more than 7 months. The prime minister and the cabinet are selected from the Parliament. No fewer than two or more than four members of the cabinet must be selected from the Senate. The judiciary also is modeled on the U.K. system. The Court of Appeals is the highest appellate court in Jamaica. Under certain circumstances, cases may be appealed to the Privy Council of the United Kingdom. Jamaica's parishes have elected councils that exercise limited powers of local government. There is increasing discussion about replacing the Privy Council as the ultimate appeal body with either the Caribbean Court of Justice (CCJ) or a domestic (Jamaican) institution. Principal Government Officials Governor General--Patrick Allen Prime Minister and Minister of Defense--Bruce Golding Minister of Foreign Affairs and Foreign Trade--Kenneth Baugh Ambassador to the United States and the Organization of American States (OAS)--Audrey Marks Ambassador to the United Nations--Raymond Wolfe Jamaica maintains an embassy in the United States at 1520 New Hampshire Avenue NW, Washington, DC 20036 (tel. 202-452-0660). It also has consulates in New York at 767 3rd Avenue, New York, NY 10017 (tel. 212-935-9000); and in Miami in the Ingraham Building, Suite 842, 25 SE 2nd Avenue, Miami, FL 33131 (tel. 305-374-8431/2). POLITICAL CONDITIONS Jamaica's political system is stable. However, the country's serious economic problems have exacerbated social problems and have become the subject of political debate. High unemployment--averaging at least 12.0%--rampant underemployment, growing debt, and high interest rates are the most serious economic problems. Violent crime is a serious problem, particularly in Kingston. The two major political parties have historical links with the two largest trade unions--the Jamaica Labour Party (JLP) with the Bustamante Industrial Trade Union (BITU), and the People's National Party (PNP) with the National Workers Union (NWU). The center-right National Democratic Movement (NDM) was established in 1995; it does not have links with any particular trade union, and is a marginal movement. A new political party, the New Nation Coalition (NNC), was established in 2010. It has yet to win an election but plans to run candidates in all 60 constituencies in the 2012 parliamentary elections. For health reasons, Michael Manley stepped down as Prime Minister in March 1992 and was replaced by P.J. Patterson. Patterson subsequently led the PNP to victory in general elections in 1993, 1997, and in October 2002. The 2002 victory marked the first time any Jamaican political party has won four consecutive general elections since the introduction of universal suffrage in 1944. Upon Patterson's retirement on March 30, 2006, Portia Simpson Miller became the first female prime minister in Jamaica's history. She left office after her party (PNP) lost to now-Prime Minister Bruce Golding's JLP in general elections held in September 2007. The current composition of the lower house of Jamaica's Parliament is 32 JLP and 28 PNP. The Jamaican constitution prohibits nationals of non-Commonwealth and non-Caribbean Community (CARICOM) countries from becoming members of Parliament (MPs). Since the 2007 general election, legal challenges have led to the disqualification of five JLP MPs, all of whom subsequently returned to Parliament after winning by-elections. At least two opposition PNP members of Parliament now face possible disqualification because of dual nationality. The next general election is to be held no later than October 2012. Human Rights The Government of Jamaica has a long history of democratic traditions and freedom of expression. Overall the Jamaican Government has respect for the human rights of its citizens. There are some areas of concern, including extra-judicial killings committed by members of the security forces, poor prison and jail conditions, inadequate levels of prosecution of police suspected of involvement in crimes, an overburdened judicial system and frequent lengthy delays in trials, trafficking in persons, and violence against suspected or known homosexuals. Religious Freedom. The Jamaican constitution provides for freedom of religion, and other laws and policies contribute to the generally free practice of religion. The Government of Jamaica generally respects religious freedom in practice. There was no change in the status of respect for religious freedom by the Government of Jamaica during the last religious freedom reporting period. There were no reports of societal abuses or discrimination based on religious affiliation, belief, or practice. The U.S. Government discusses religious freedom with the Jamaican Government as part of its overall policy to promote human rights. According to the most recent census (2001), the population's religious affiliation consists of Church of God, 24%; Seventh-day Adventist, 11%; Pentecostal, 10%; Baptist, 7%; Anglican, 4%; Roman Catholic, 2%; United Church, 2%; Methodist, 2%; Jehovah's Witnesses, 2%; Moravian, 1%; Brethren, 1%; unstated, 3%; and "other," 10%. The category "other" includes 24,020 Rastafarians, an estimated 5,000 Muslims, 1,453 Hindus, approximately 350 Jews, and 279 Baha'is. The census reported that 21% claimed no religious affiliation. Rastafarians in Jamaica routinely claim to be the subjects of government discrimination due to laws against marijuana possession, the use of which they consider to be a sacrament. Trafficking in Persons. Jamaica is a source, transit, and destination country for women and children trafficked for the purposes of sexual exploitation and forced labor. The Government of Jamaica does not fully comply with the minimum standards for the elimination of trafficking; however, it is making significant efforts to do so. Over the past year, the Jamaican Government has made strong progress in the prosecution of trafficking offenders and continues its solid efforts to prevent human trafficking, although its services to trafficking victims remained largely inadequate. The United States has urged Jamaica to expand efforts to investigate, convict, and punish traffickers for their crimes; extend training on human trafficking issues among law enforcement agencies; increase funding for shelter services and other assistance to victims; and continue awareness campaigns aimed at vulnerable populations, especially young people. Child Labor. The Government of Jamaica has taken significant steps to pass and enforce legislation on child labor, although conviction rates in this field, as in others in Jamaica, remain low. Despite the fact that the Jamaican Government recently increased the compulsory age of education from 16 to 18 and confirmed children’s right to education under the Education Act, field research confirms child labor practices remain a concern.
Principal Government Officials
Governor General--Patrick Allen Prime Minister and Minister of Defense--Bruce Golding Minister of Foreign Affairs and Foreign Trade--Kenneth Baugh Ambassador to the United States and the Organization of American States (OAS)--Anthony Johnson Ambassador to the United Nations--Raymond Wolfe Jamaica maintains an embassy in the United States at 1520 New Hampshire Avenue NW, Washington, DC 20036 (tel. 202-452-0660). It also has consulates in New York at 767 3rd Avenue, New York, NY 10017 (tel. 212-935-9000); and in Miami in the Ingraham Building, Suite 842, 25 SE 2nd Avenue, Miami, FL 33131 (tel. 305-374-8431/2). Government Type: Constitutional parliamentary democracy. Independence: August 6, 1962. Constitution: August 6, 1962. Branches: Executive--Governor General (chief of state, representing British monarch), prime minister, cabinet. Legislative--bicameral Parliament (21 appointed senators, 60 elected representatives). Judicial--Court of Appeal and courts of original jurisdiction. Subdivisions: 14 parishes, 60 electoral constituencies. Political parties: People's National Party (PNP), Jamaica Labour Party (JLP), National Democratic Movement (NDM), United Peoples Party (UPP). Suffrage: Universal at 18.

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History of Jamaica

Arawaks from South America had settled in Jamaica prior to Christopher Columbus' first arrival to the island in 1494. During Spain's occupation of the island, starting in 1510, the Arawaks were exterminated by disease, slavery, and war. Spain brought the first African slaves to Jamaica in 1517. In 1655, British forces seized the island, and in 1670, Great Britain gained formal possession. Sugar made Jamaica one of the most valuable possessions in the world for more than 150 years. The British Parliament abolished slavery as of August 1, 1834. After a long period of direct British colonial rule, Jamaica gained a degree of local political control in the late 1930s, and held its first election under full universal adult suffrage in 1944. Jamaica joined nine other U.K. territories in the West Indies Federation in 1958 but withdrew after Jamaican voters rejected membership in 1961. Jamaica gained independence in 1962, remaining a member of the Commonwealth. Historically, Jamaican emigration has been heavy. Since the United Kingdom restricted emigration in 1967, the major flow has been to the United States and Canada. About 20,000 Jamaicans emigrate to the United States each year; another 200,000 visit annually. New York, Miami, Chicago, and Hartford are among the U.S. cities with a significant Jamaican population. Remittances from the expatriate communities in the United States, United Kingdom, and Canada, estimated at up to $1.6 billion per year, make increasingly significant contributions to Jamaica's economy.

People of Jamaica

Arawaks from South America had settled in Jamaica prior to Christopher Columbus' first arrival at the island in 1494. During Spain's occupation of the island, starting in 1510, the Arawaks were exterminated by disease, slavery, and war. Spain brought the first African slaves to Jamaica in 1517. In 1655, British forces seized the island, and in 1670, Great Britain gained formal possession. Sugar made Jamaica one of the most valuable possessions in the world for more than 150 years. The British Parliament abolished slavery as of August 1, 1834. After a long period of direct British colonial rule, Jamaica gained a degree of local political control in the late 1930s, and held its first election under full universal adult suffrage in 1944. Jamaica joined nine other U.K. territories in the West Indies Federation in 1958 but withdrew after Jamaican voters rejected membership in 1961. Jamaica gained independence in 1962, remaining a member of the Commonwealth. Historically, Jamaican emigration has been heavy. Since the United Kingdom restricted emigration in 1967, the major flow has been to the United States and Canada. About 20,000 Jamaicans emigrate to the United States each year; another 200,000 visit annually. New York, Miami, Chicago, and Hartford are among the U.S. cities with a significant Jamaican population. Remittances from the expatriate communities in the United States, United Kingdom, and Canada reached $2 billion in 2008; remittances dipped 15% from 2008 to 2009, but do not appear to be falling further. Nationality: Noun and adjective--Jamaican(s). Population (2009 est.): 2,825,928. Annual growth rate (2009 est.): 0.755%. Ethnic groups: African 90.9%, East Indian 1.3%, Chinese 0.2%, White 0.2%, mixed 7.3%, other 0.1%. Religious affiliation: Anglican, Baptist and other Protestant, Roman Catholic, Rastafarian, Muslim, Jewish. Languages: English, Patois. Education: Years compulsory--to age 18. Literacy (age 15 and over)--87.9%. Health (2009 est.): Infant mortality rate--15.22/1,000. Life expectancy--female 75.3 yrs., male 71.83 yrs. Work force 1.3 million (2008 est.): Industry--17.1%; agriculture--17.9%; services--64.9%.