Oversight controversies hurting investor confidence, says Bunting

Opposition Spokesperson on Productivity, Efficiency and Competitiveness, Peter Bunting, has signalled that a decline in the net foreign direct investment (FDI) inflows as a per cent of gross domestic product (GDP) should not come as a surprise given the recent controversies involving the treatment of independent oversight institutions locally.

In his contribution to the Sectoral Debate in Parliament on Wednesday, Bunting said FDI inflows as a per cent of GDP have declined to around 1.5 per cent to two per cent of GDP since 2020. He said this was less than a third of what the country received as recently as 2015 and 2016, when net FDI exceeded six per cent of GDP.

“Investors value certainty. Entrepreneurs value predictability. Businesses make long-term commitments when they believe that rules will be applied consistently and institutions will operate independently,” Bunting said.

He cautioned that recent controversies involving the treatment of independent oversight institutions should concern anyone interested in Jamaica's competitiveness.

Highlighting some of the controversies, Bunting pointed to “an unprecedented move for a sitting prime minister [who] took his own state oversight body – the Integrity Commission (IC) – to the Supreme Court.

He said the prime minister filed more than 20 applications seeking to nullify the IC’s investigative report into his statutory declarations and challenge the constitutionality of core provisions within the Integrity Commission Act passed by his Government.

Bunting also referenced the passing of the controversial National Reconstruction and Resilience Authority (NaRRA) Act, claiming that many saw it as a “naked power grab by the prime minister”. He said the legislation gave the agency and the head of government sweeping executive powers, with a lack of institutional guardrails, and the ability to bypass traditional regulatory oversight.

He also mentioned the prime minister's decision to overrule a regulatory body and grant a permit to a company to carry out mining in the ecologically sensitive Dry Harbour Mountains of St Ann. However, he noted that the Constitutional Court, in a recent landmark ruling, declared the permit and the PM’s decision “unconstitutional, void, and of no effect”.

The opposition spokesman on productivity and efficiency said bureaucracy was one of the most damaging taxes in Jamaica that does not appear on an invoice. “Every entrepreneur experiences it. It is paid in delays, uncertainty, duplicated paperwork, and lost opportunities.”

He argued that in successful economies, institutions are designed to minimise bureaucracy but in Jamaica, too many institutions continue to generate them. This, he said, results in lower investment, slower business formation, and weaker productivity growth.

According to Bunting, strong institutions encourage investment because they reduce uncertainty while weak institutions discourage them because individuals and businesses must devote additional resources to navigating risk and unpredictability. He said productivity, therefore, depends not only on economic policy but also on governance quality.

editorial@gleanerjm.com