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IDB Assistance: Reducing Poverty in Jamaica

Poverty in Jamaica
With over 2 million stopover visits, the tropical island of Jamaica remains one of the most popular tourist vacation areas; renowned home of Reggae legend Bob Marley and the fastest man in the world, Usain Bolt. However, within and around the outskirts of paradise lives the poor and those experiencing financial hardship.

Yet many remain oblivious to the existence of poverty in Jamaica. The poverty rate in Jamaica remains at 16.5 percent, after increasing in the past two years.

The Inter-American Development Bank (IDB) will be providing $50 million in support of the Jamaican Government’s efforts to help alleviate poverty. The IDB investment loan was initiated to support poor families who were beneficiaries of the Program of Advancement Through Health and Education (PATH).

With the aim of alleviating poverty in Jamaica, PATH was put into effect by the government within its social safety net budget. The IDB’s project was put into place to provide financial and health stability for eligible beneficiaries of the PATH program such as children and pregnant women.

“The Integrated Support to Jamaica’s Social Protection Strategy project is a continuation of support by the IDB to the reform of Jamaica’s SSN,” said Therese Turner-Jones, IDB country representative for Jamaica said.

She noted that since 2000, in partnership with the World Bank, IDB is to achieve greater equity, efficiency and effectiveness. This included a previous investment loan in 2009 to reduce the life-threatening effects of the food price crisis on the most impoverished.

For two consecutive international financial crisis periods, the IDB has created scheduled loans against social spending as well as to protect against labor policies. Their efforts have promoted human capital and supported the networking of the poor into labor markets.

Turner-Jones outlined that the Integrated Support to Jamaica’s Social Protection Strategy project will help reduce the negative impact of fiscal adjustment on the poor.

The IDB loan for $50 million is set to continue for 25 years, with extended overtime of 5.5 years and an interest rate based on LIBOR.

The IDB has come on board to support the long-term development plan for Jamaica, Vision 2030 Jamaica, to reduce poverty by ensuring access to basic goods and services, responsive public policy, opportunities for sustainable livelihoods and social inclusion.

– Shanique Wright

Photo: Flickr

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8 Facts About Poverty in Jamaica

Poverty in Jamaica Poverty rate
Jamaica has struggled with poverty, unemployment and crime for the past half century, but the nation has recently seen ambitious government economic policies bear fruit. Discussed below are the leading facts about poverty in Jamaica and their implications.

8 Facts about Poverty in Jamaica

  1. Jamaica is not in extreme poverty and is regarded as a middle income country. For comparison, Jamaica has about 1/20th the GDP per capita of the United States, but a four-times-higher GDP per capita than the nearby country Haiti.
  2. Since the 1970s and 80s, Jamaica has experienced serious problems with poverty and unemployment. Through the 90s, unemployment remained around 15 percent, with poverty above 25 percent. The unemployment rate is currently 14 percent and poverty is 16 percent.
  3. A serious hindrance to Jamaica’s development has been slow rates of economic growth. In the past 30 years, Jamaica has had an average annual GDP growth rate of less than one percent. The slow growth rate is a major cause of persistent poverty in Jamaica.
  4. Relationships between Jamaican officials and crime groups cause widespread corruption, which results in many of Jamaica’s problems. The corruption not only hurts law abiding Jamaican citizens, but makes foreign investors far more hesitant to get involved in Jamaican industry.
  5. Public education in Jamaica is not entirely free. There is a registration fee and other school expenses that are not covered by the government. As a result, many of the nation’s most poor children are not able to attend school.
  6. Jamaica jumped 27 places in the 2015 Doing Business ranking, as the Jamaican government has improved its credit rating and decreased the national debt. It is hoped that the improved ranking will increase investment and alleviate poverty in Jamaica.
  7. The World Bank has a positive outlook for Jamaica’s economy, with forecasts of the country’s GDP growth rate climbing to over two percent in 2017.
  8. The Jamaican Government is currently working with the UNDP and the European Union to alleviate poverty on both a macro and micro level. Poverty alleviation and achievement of Millennium Development Goals remains a top priority for the Jamaican government.

Despite Jamaica’s history of poverty and some ongoing problems, economic forecasts for the country remain optimistic. It is possible that Jamaica will experience an economic resurgence and alleviate problems of unemployment and poverty in coming years.

– John English

Photo: Pixabay