CANNABIS COMPANIES MOVING OUT OF JAMAICA. CAPITAL ON THE MOVE

News are circulating in local and international medias that cannabis companies are leaving JAMAICA.
http://www.jamaicaobserver.com/latestnews/Canadian_cannabis_companies_withdraw_from_
https://www.google.com/amp/s/www.forbes.com/sites/sarabrittanysomerset/2020/05/30/aphria-aurora-and-other-big-ag-cannabis-companies-pull-out-of-jamaica-and-latin-america/amp/

Major reason they gave why they are leaving is because the government is moving too slow with regulations. However, I have my doubt about the reason. These companies have the clout both local and foreign to pressure the authorities to give them the regulatory framework for them to operate. Seem like they choose not to. Rather they decided to pack up and leave.
INTERNATIONAL CAPITAL
International Capital almost always move out of emerging and developing countries whenever there is turmoil in the World. There is so much turmoil in the World currently it is probably the first time so many huge issues are happening in our World at the same time.
COVID19 which is impacting every single economy in the World in a negative way, We have trade war between the World two biggest economy on the Globe, we have oil crisis where the price dip to as low as 0 a few weeks ago, tension between Iran, USA and Venezuela and the latest big one, in many USA States and Cities demonstration is happening over the killing of an African American by a police officer by kneeling in his neck for more than five minutes. Those are just a few of the many issues with Global magnitude, there are many more.

We here in the Caribbean is coming into the hurricane season. There are predictions that we will be having a record number of hurricanes this year. All the above cause huge risk for capital. Investors the World over seems to look for safer place especially the USA and USD to put their investment in these times.

Countries like Jamaica have been doing well in terms of managing our debt, controlling inflation, growing our stock market, creating record employment, grow our international reserve to record level, record FDI etc, over the pass seven (7) years . The Jamaica Stock Exchange for 5 years in a row was the number one stock market in the World in terms of return on investment. Covid19 have shaken all the above to the core. All of Jamaica’s major earners are significantly down at this time and the Country just started to slowly ease up the COVID19 RESTRICTIONS. No despite all our planned effort to get the economy back on track a number of experts and financial institutions are predicting economy decline of 5 to 14 percent.

USA AND EUROPE
Ironically even though we are managing COVID19 better than USA and Europe we will have to wait on them as it relates to tourism especially because most of our tourist are from USA and Europe. Tourism is one of our top foreign exchange earners. Then there is remittance, forty million Americans are out of a job due to covid. I guess many of those are Jamaicans who generally remit money to Jamaica that is not going to happen in the near and medium term. Coffee is down, bauxite down, sugar down etc. The reality is, things don’t look good going forward for our economy. More than sixty-five (65) percent of our economy is related to foreign trade. Until we can reverse that we are always going to have hug issues from international shocks and international financial crisis. The current development model is heavily in favour of FDI’S. That will not change anytime soon.

OPPORTUNITIES
These Cannabis Companies leaving is a great opportunity for us to create a local industry with local standard, local expectation, and local markets. This would make the industry germane to Jamaica and
in line with others of our creations like reggae, rasta, ganja, patios etc, these things will always have their roots in Jamaica. Therefore, capital may come, and capital may go as we are seeing. Monetizing our creations and make capital local and foreign feel safe is where our answer lies Check out the Bloomberg link below.
https://www.bloomberg.com/news/articles/2020-04-01/a-mother-of-all-sudden-stops-leaves-emerging-markets-in-crisis
Regard making capital feel safe we seem to at time make it feel risky. In the nineties the government of the day by an act of parliament overnight took tens of millions from the banks. Couple years later the banking sector collapse. Recently the governor of the central bank causes the banks not to pay interest due…. These actions don’t engender safety of capital in the system.