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Drawing on presentations at the Construction Industry Roundtable, on the theme, Construction as Driver for Economic Growth, the cover story for this issue examines various aspects of the industry and the extent to which the sector was delivering on its potential to be a driver for growth. The Roundtable was hosted by the Mona School of Business and Management as part of the School’s engagement with critical stakeholders on important issues of business policy and practice. It attracted an impressive array of presentations from policy makers, construction industry stakeholders, business people and scholars in the academy.

The presentation by colleagues William Lawrence and Cecil White of Mona School of Business and Management, summarised in this issue, gives a comprehensive analysis of the construction sector. The data shows that the contribution of the construction industry to GDP has been declining but it’s not necessarily terminal. They conclude, “Based on our study of the sector and industry analysis we have identified a number of measures that both government and the construction industry can take to renew the sector. Government policies must help to build the capacity of local construction firms for large projects that have the potential to increase jobs and retain income.”

Donald Mullings, a leading player in the sector and a past president of the Incorporated Masterbuilders Association makes a strong case for levelling of the playing field between foreign and domestic firms. He writes, “As Jamaica strives to improve competitiveness, grasp economic opportunities, and to create a better life for its people, the industry must continue to provide the infrastructure that will enable success of the sectors.”

Dr Horace Chang, MP, Minister without Portfolio (Water, Works & Housing) in the Ministry of Economic Growth and Job Creation points out that the construction sector is vital to the government’s growth agenda. He asserts that Jamaica has “the knowledge, the expertise and the entrepreneurial acumen required to develop appropriate and realistic strategies to revolutionize our construction industry and drive the Growth Agenda.”

Against a background of industry concerns about the dominance of Chinese firms in the sector, Dr Peter Phillips, MP, president of the People’s National Party and leader of the parliamentary opposition argued that Government policy should reserve preferential treatment for Jamaican firms. More broadly, he argued that “as a country and an industry we have to do new and different things to put the industry in a better position to be a major driver of economic growth and development.”

In our Economy and Finance section Danny Roberts, Senior Lecturer and Head of the Hugh Lawson Shearer Trade Union Education Institute, UWI, Open Campus and co-chair of the Public Sector Transformation Oversight Committee, discusses the .topical 2017-2019 public sector wage cycle within the constraints of the precautionary agreement with the IMF.

Kadamawe Knife, the director of the Centre for Entrepreneurship Thinking and Practice in the Faculty of Social Sciences, UWI and former director of the Office of Social Entrepreneurship, MSBM, offers insights into the Social Entrepreneurship landscape in Jamaica highlighting the importance of the social economy in generating social value while addressing social problems.

In the Business Barometer, Ralph Thomas, Senior Teaching Fellow of the Mona School of Business and Management and a former Jamaican Ambassador to The Peoples Republic of China and Ambassador to the United States of America discusses strategies for balancing the Jamaica-China business relationships. The basic ingredients for continuance of a meaningful long-term relationship with China remains in place and any necessary rebalancing of the relationship can be achieved through continued goodwill, better understanding, communication, dialogue and adroit diplomacy.

Technology Focus also examines the construction industry as Maurice McNaughton director of the Centre of Excellence for IT Innovation, Mona School of Business and Management, UWI. Mona explores some of the opportunities for the use of low-cost ICTs to enable and enhance what is broadly referred to as “Lean Construction” practices. He draws on the practical experiences of a real-world case study of a small firm in the British Virgin Islands.

 

Michael Williams,
Executive Director (Acting) , Mona School of Business and Management


 

From the Editor
 The proposed redevelopment of downtown Kingston involving some 13-million square feet of building, valued at over US $1.6-billion inclusive of a new Parliament building, ministries and agencies, infrastructure works as well as general commercial and residential construction is being hailed by government as transformational.
It has been universally recognised that realisation of this project would infuse economic, social and cultural energy into a huge section of the city that has been decaying for decades. But, at the same time, there has been considerable disquiet among significant sections of public opinion fearing that Jamaican professionals in the construction sector will be side-lined by the Chinese who are expected to provide the capital and most of the expertise. It’s all about the piper payer calling the tunes.

As is widely known, Chinese firms have been major players in the sector, from mega-projects like the North-South Highway to smaller bridge and road projects and commercial construction in the private sector. Chinese firms have also invested in agriculture (cane and sugar production), bauxite mining and alumina production, and have been also increasingly active in retailing in cities and towns across the island.

Against that background, debate over the relative roles of Jamaican and foreign firms in the construction industry was one of the subtexts for discussions at a Roundtable, hosted by Mona School of Business and Management, examining various aspects of the construction industry and the extent to which it was delivering on its potential to be a driver of economic growth in Jamaica.

Presentations from the Roundtable form the basis for the cover story in this very important and timely issue of MSBM Business Review. Policy makers, academics and industry professionals all agreed that the construction industry could be a major driver of the Jamaican economy.

Donald Mullings, a past president of the Incorporated Masterbuilders Association was passionate about levelling the playing field between foreign and Jamaica firms. “Domestic contractors, contrary to what some might want to believe, are not asking for any special favours or to ban foreign contractors. What we ask is to be given an opportunity to carry out our business in a fair way in our country.”

Ralph Thomas, senior teaching fellow at MSBM and a former Jamaican ambassador to both China and the United States makes a thoughtful case for overcoming present challenges in Jamaica-China relations. “There are mechanisms and counter-measures that can be applied to this process which can result in ‘Win-Win’ outcomes for both countries as they seek to navigate the perils of successfully managing and balancing bilateral relationships without acrimony or long-term damage to the valuable relationship. This must begin with diplomatic and other initiatives to seek affirmative mechanisms that provide some protection for local industry participants, through deeper collaboration such as Joint Ventures and sub-contracting arrangements.”

Several other practical proposals emerged at the Roundtable including the need to establish a Construction Industry Development Board comprising all relevant stakeholders as a policy, planning and coordinating mechanism.

Another major contributor to increased efficiency would be to finally adopt the Construction Industry Policy document which has been in draft stage since 2004. Among other things the policy would provide a consistent policy framework for the development of the sector and drive innovation, modernisation and competitiveness. We hope the insights from the Roundtable and this issue will serve to push the process forward. Further delay can be to our peril.

 

Claude Robinson
Editor