The government must prepare the people for the shocks of the coming national budget and do it early. It has no control over the global economic crisis which will impact heavily on the budget - neither did the PNP Opposition when it formed the government - but government has a responsibility to do everything possible to cushion the intensity of the impact.

Ken Chaplin

The government was rather late in explaining fully to the country the effect that the global economic meltdown will have on Jamaica. Finance Minister Audley Shaw, apparently not wanting to create panic, seemed to have underestimated the full impact the crisis will have on Jamaica. It was left to Prime Minister Bruce Golding to tell the full story in a brilliant dissertation at a function in Montego Bay, a speech that should have been made in Parliament and broadcast islandwide. Now it is the responsibility of the government's communication apparatus, especially the Jamaica Information Service, to disseminate the information in the speech throughout Jamaica so people will understand the full impact of the crisis in Jamaica.

It was disingenuous of the Opposition spokesman on finance, Dr Omar Davies, to suggest that the speech was political. Rather it was profound and it captured, in simple language, the crisis and how the country will have to tackle it.

Ian Boyne, director of production at the Jamaica Information Service, did a masterful analysis of the speech in his column in the Sunday Gleaner recently in which he supported Golding's points. Indeed, when the PNP was in power and the JLP in Opposition, some of Boyne's comments were regarded as anti-JLP. I do not recall him stating in his column that he was director of production at the main mouthpiece of the government. But all the knocks that Boyne gets were expected because as a top public servant he should not be writing on political matters. Notwithstanding all I have said, people find his column informative and interesting, and he ought to continue to do now what he has done in the past.
Placing the world economic crisis in perspective, Golding said that 25 banks collapsed in the USA last year and a further 14 so far this year. Similar bank failures have occurred in Europe and Asia, the other two dominant regions in the global financial market. The International Monetary Fund declared last month that bank losses worldwide would exceed US$2.2 trillion. It is not just the failed banks that have suffered. Stocks and assets held by financial institutions across the world have lost more than US$30 trillion in market value in a matter of a few months.

Savers and investors will have to absorb a substantial portion of the losses. The banking system will have to be rebuilt and new domestic and global regulatory systems put in place. Only then will confidence be restored and people start saving, investing, borrowing and spending again. Only then will the demand for goods and services start growing again, factories start reopening, employers start rehiring and recovering again. It is in this context that Golding said that Jamaica's fate must be considered. "Part of our own reality is that even before the onset of the crisis the Jamaican economy was not in good shape. We have lived for almost a generation with prolonged periods of low growth, huge debts, large fiscal deficits, high unemployment and weak export performance," the prime minister said.