Contextualizing Jamaica’s Relationship with the IMF

332 Pages·2020·2.997 MB·English

by  Christine Clarke, Carol Nelson

Christine Clarke · Carol Nelson
Contextualizing
Jamaica’s
Relationship
with the IMF
Contextualizing Jamaica’s Relationship
with the IMF
Christine Clarke • Carol Nelson
Contextualizing
Jamaica’s Relationship
with the IMF
Christine Clarke Carol Nelson
Department of Economics Department of Government
University of the West Indies University of the West Indies
Mona, Jamaica Mona, Jamaica
ISBN 978-3-030-44662-8 ISBN 978-3-030-44663-5 (eBook)
https://doi.org/10.1007/978-3-030-44663-5
© The Editor(s) (if applicable) and The Author(s) 2020
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Christine wishes to dedicate this book to her parents
and grandparents, from whose shoulders she was able
to reach the sky. Anaelle, reach even further!
This book is dedicated to my family for their support during
the writing and also to colleagues of the past and present, within the
public service and academia, whose experiences are reflected in what
we write.—Carol Nelson.
P
reface
Contextualizing Jamaica’s Relationship with the International Monetary
Fund reflects the undertaking of a comprehensive quantitative and quali-
tative review contextualizing Jamaica’s relationship with the International
Monetary Fund (IMF). The book seeks to be innovative in synthesizing
the methodologies and conceptual frameworks of Actor Network Theory
(ANT) and Critical Discourse Analysis (CDA) as the lens through which
Jamaica’s emergence as a state and relationship with the International
Monetary Fund (IMF) are explored. This represents a departure from
methodologies that typically explore such topics and subject matters.
The formal arrangements brokered, the societal interface, as well as
implications for development are revisited, analysing social relations and
relationships within Jamaica’s historical, global and political-economy
context as well as exploring the social, economic and developmental impli-
cations. The methodologies of ANT and CDA facilitate the departure
from conventional lens of analysis, as ANT’s ontology affords the concep-
tualization of the animate and inanimate as actors possessing their own
agency, networks, connectivity and, through the ‘sociology of translation’,
insight into the nature of social relations. When combined with CDA, the
nature of the connectivity within the actor networks can be probed,
namely the text, discourse and discourse practice within modalities of
social relations where power is exercised and contested.
The book not only highlights themes that have characterized and
contextualized Jamaica’s relationship with the IMF, but also captures the
vii
viii PREFACE
exploration of actor networks, social relations and development implica-
tions. Domestic and international discourses surrounding the evolution of
the actors, characteristics and networks of relations ‘back then’ as com-
pared to currently are also explored.
Historically, there is the creation of a multiplicity of actor networks and
shaping of the discourse and practice of Jamaica as an emerging state, with
implications for the domestic economy, policy and decision-making as well
as the modalities of government, governance and coherence of social rela-
tions, reflecting on the colonial era moving forward.
Expressions of power within social relations between actors, namely the
‘colonized’ and the ‘colonizer’, are revelatory, as the colonizer is, in turn,
an actor positioned within geopolitical actor networks, who also becomes
a captive to emerging vulnerabilities of his own. Changing geopolitics of
the empire and political economy networked relations of the colonizer
unearthed deficiencies and weaknesses, engendering various crises of gov-
ernance. One of such was portrayed in the Caribbean by unrest and rebel-
lion, which when accompanied by the revelations of the Moyne
Commission altogether furthered the gradual relinquishing of the colo-
nizer’s networks of domination during the pre- Independence era.
Independence led to efforts to demonstrate the new status, by domes-
tic and economic forays into limited policy and independent decision-
making as expressions of being now empowered. However, the effectiveness
of such was curtailed by a fragile macroeconomy and fractured, diverse
social relations, reflecting colonial cleavages, along racial, political, class,
economic and ethnic lines, with multiple and contending self-interests.
But these social relations signalled unification around a hope, or even the
expectation, that self-government would bring benefits previously denied
under colonialism.
There is an interrogation of some key themes and issues of the IMF as
an actor network—its characteristics, emergence, discourse and practice as
explored through various key themes. Created and positioned as a macro
social actor with an ideological base and discourse practice, the IMF actor
network is operationalized and exercised through networked relationships
within the global community. Several critiques arise concerning the nature
of the interface and influence, contributing to reflections upon the out-
working of the discourse and practice of the IMF itself and its interactions
within the global network of relations and space of flows.
PREFACE ix
Jamaica’s engagement with the Fund during the 1970s and the charac-
teristics of the agreements were derived within the context of divisive and
contending global, geopolitical and ideological juxtapositioning in the
global economy.
Integrated within the global political economy as a small fish in a big
pond, Jamaica’s ideological alignment, interface, positioning and global
networked relationships influenced the policy framework pursued as well
as the nature of its engagement with the IMF. Concomitantly, the IMF
was also being influenced by and reflected global geopolitical and ideo-
logical interests during the period, which led to degrees of divergence
implicating its networked relations with Jamaica, concomitant with the
nature of its interface with developing nations.
The recognition of the influence of ideological actor networks, external
actors, and interests and modalities of their interface with and within the
Jamaica actor network was revealed within diverse societal expressions and
commentaries, implicating the Jamaica-IMF relationships and the charac-
teristics of external relations. Key dimensions of such are explored through
the lens of societal actors’ responses, discourse and practice as they sought
to interpret the variability within the government-IMF relationship, as
well as the nature of Jamaica’s connectivity to geopolitical networks of
power. Jamaica’s relationship with the IMF has been most tumultuous
considering its beginnings compared to other international financial insti-
tutions (IFIs). Aspects of the IMF relationship in the 1980s–1990s were
reflected in riots and civil unrest. No multilateral development partner or
international financial institution has received such a national response in
the implementation of its policies or programmes in Jamaica’s history.
In the 1980s, the IMF-Jamaica interface foregrounded change,
reflected in the economic and socio-political discourses concerning the
economy. The newly elected JLP regime of Edward Seaga, committed to
the Washington Consensus with the intent to effect substantive develop-
ment within Jamaica. The new approach was short-lived, attributed to the
‘triumvirate’ of the variability and instability of the networks of global
markets (to which Jamaica was connected), global recession and debt cri-
ses impacting the loss of earnings, and the impact of Hurricane Gilbert,
despite an expedited recovery. The concomitant results heralded the
return to low growth, high unemployment and foreign exchange
challenges.
x PREFACE
Michael Manley’s return as Prime Minister heralded a full-fledged dive
into liberalization in the 1990s, a deepening deregulation of the economy
and economic policy independence. However, his efforts fell captive to the
costs of his policy reversals incurred in the 1970s in the pursuit of social
justice and equity that had resulted in an enormous debt overhang, over-
shadowing the economy with devastating economic impact. Policy inde-
pendence was, indeed, achieved, but this was juxtaposed against economic
records that detailed the severe difficulties experienced as the nation strug-
gled with the management of economic policy and structural reforms,
with the hope that these efforts would result in development and the pro-
duction of more competitive goods and services.
The absence of a formal Jamaica-IMF lending arrangement precipi-
tated home-grown initiatives as well as the interplay of perspectives under
a Staff-Monitored Programme, whereby both sides interfacing in various
discussions would come to mutual understandings to inform Jamaica’s
trajectory, as countervailing issues had to be navigated in the macroeco-
nomic context of a very high public-debt-to-GDP ratio. There was strug-
gle in terms of the inculcation of change in the domestic context,
influencing social relations, with reflexivity in the discourse and practice of
actor networks as policy independence became elusive and solutions
were needed.
One of the home-grown initiatives that emerged to treat with eco-
nomic crisis trending in the absence of a formal lending relationship with
the IMF, after Jamaica’s financial crisis of 1999 and its effects, was the
negotiation of a public sector memorandum of understanding (MOU), a
social partnership agreement between the government and the Jamaica
Confederation of Trade Unions (JCTU). This social partnership agree-
ment included the maintenance of the current size and cost of wage
expenditure to the budget for public sector workers coupled with a wage
freeze. There would be no job losses nor redundancies. The size of the
public sector was growing along with the associated increased costs for the
wage bill, so the capping of expenditures in this regard was critical given
the macroeconomic state of the economy. On the part of the government
the MOU provided time and enabled a degree of fiscal space to address
underlying macroeconomic challenges.
Through the lens of ANT and CDA, the former’s ontology afforded
the conceptualization of the MOU as an actor network, vested with a dis-
course of its own. The connectivity within the actor network created,
reflecting MOU discourse and practice as informed by the text of the
PREFACE xi
MOU agreement, when analysed using CDA was revelatory, bringing to
the fore salient themes—notably, confirming the value of social partner-
ship as a mechanism of governance especially in a time of crisis, facilitating
unusual forms of collaboration between strange bedfellows, in Jamaica’s
case, such as labour and government. Analyses also distilled that the stabil-
ity of commitments is undergirded by the mutual coincidence of need and
by engendering the support required to minimize the risk of loss, espe-
cially in a time of national challenge.
After eighteen years, a new leadership and a new regime were elected
and emerged as combatants against the worsening economic conditions,
further aggravated by global food and fuel price crises in the aftermath of
the 2008 global financial crisis. It was unequivocal that an IMF interven-
tion was needed in the form of a balance of payments support for the
economy. Returning to the Fund precipitated calm on the domestic econ-
omy against the framework of a reformed IMF, juxtaposed with the cre-
ation by domestic policymakers of a long-term, inspirational strategic
framework and ‘vision’, guiding economic development to actualize
Jamaica as the place of choice to live, work, raise families and do business.
This book, the first of two, seeks to locate the analyses and findings
within a comprehensive, historically contextualized Jamaica-IMF relation-
ship, inclusive of analyses of socio-economic performance with and with-
out the IMF as a stakeholder as well as the social and developmental
implications for the country’s development trajectory. This book contex-
tualizes the Jamaica-IMF relationship with respect to the interests, actors
and diverse stakeholders and political economy themes within the domes-
tic sphere of Jamaica’s historical growth and development. It portrays an
exploration and investigation into Jamaica’s history and nature of the
decision-making, which facilitates reflection, even in part, upon the
domestic and international discourses surrounding the contextual evolu-
tion of the IMF-Jamaica relationship, interlinked with the political econ-
omy of Jamaica’s growth and development, which played a role in
conditioning the engagement at that time. Jamaica’s relationship with the
IMF has gone through several stages over several years and has evolved,
and this book seeks to evaluate how this relationship has shaped the social
and developmental trajectory in Jamaica.
The International Monetary Fund as an actor, whilst not innocent of
misdiagnosis and implementation, policy mistakes and blunders, was not
the demon it was painted during the 1970s and 1980s. Furthermore, the
Fund has, to some degree, redeemed itself to the various actors in Jamaica