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or any other comparable country to fully escape poverty. Let me repeat this and be perfectly clear: services, agriculture, and mining will never develop Jamaica. Not in 500 years.
There are reasons for this. Production in manufacturing is not technically limited by natural conditions, as in the case of agriculture, mining, or tourism; growth is not limited by the home market, as goods can be exported; high reliance of manufacturing on production by other industries generates positive demand impulses for the overall economy; research, technological development, and innovation is concentrated in manufacturing. The manufacturing sector accounts for the overwhelming majority of any nation’s patent filings, and research and development spending.
Interestingly, all industrialisation in the mid-19th century, just like today, had something in common: manufacturing industries that experienced rapid growth and pulled countries out of poverty were special ones. They were at the heart of the development of the major new technologies of their time. Prominent in the case of England were textiles; steel in the US; equipment and machinery in Germany and Japan; and the ‘Asian Tigers’ Taiwan and South Korea relied heavily on semiconductors. Why? Because these industries grew dramatically faster.
Entry with a chance to eventually become competitive is much easier and cheaper in emerging industries. They involve the highest rates of technological development, which creates positive technological spillovers along the value chain (inputs, inputs of inputs, ...), upgrading the entire economy.
There is some bad news. Value added in Jamaican manufacturing contributes just nine per cent to GDP, with an average growth of total GDP in the past 20 years of just 0.5 per cent. In industrialised countries like Switzerland, this number is almost triple.
Even worse, our manufacturing industries are not those that can make a poor country rich. More promising are portfolios of countries like Malaysia and China (7-9 per cent average GDP growth) with photovoltaic energy equipment, batteries, electric cars, cell phones, semiconductors and other electronics.
These are industries of the