Jamaica Gleaner

The doctrine of resilience

- ■ Cedric E. Stephens provides independen­t informatio­n and advice about the management of risks and insurance. For free informatio­n or counsel, write to: aegis@flowja.com or business@gleanerjm.com

RESILIENCE IS a word that Prime Minister Andrew Holness often uses. He picked that expression in a November 2017 climate change speech. He used it again in June 2018 when he spoke at the Outreach Session of the G7 Summit in Quebec, Canada.

“Building resilience,” he said, “is not optional; it is an imperative for our survival. Creative and innovative solutions must be found to design appropriat­e risk mitigation, risk transfer, and risk financing tools while ensuring wide participat­ion in solutions.”

That message, though directed at an audience of world leaders, also had implicatio­ns for persons in the local public and private sectors.

Little did Prime Minister Holness or members of his audience know then how prophetic his words would turn out to be given the emerging threat that engulfed the world 18 months later and put resilience to the test. A once-in-a-century event, in the form of a pandemic, occurred and disrupted lives, the operations of countries, businesses, and all kinds of institutio­ns around the globe – big, medium, and small.

Minister of Finance and the Public Service Dr Nigel Clarke got the message. He spoke about resilience in his 2021-22 Budget Speech. He continued the discussion last month in the context of the country’s fiscal risk of natural disasters in a newspaper article.

“Natural disasters generate the need for government­s to engage in emergency public expenditur­e. The layers of Jamaica’s (current) strategy collective­ly provide fiscal buffers for the fiscal shocks that natural disasters inevitably cause,” he wrote. “These buffers increase Jamaica’s resilience and strengthen our ability to recover … without too much impairment to our economic trajectory.”

The buffers to which he referred are new. None of them existed 30 years ago.

The Jamaica Informatio­n Service reported last week that resilience was once more the subject of another speech that the PM delivered about COVID-19.

“There will always be adverse events outside of our control, and the Government must be deliberate and systematic in building our resilience and investing in our capacity to understand future shocks, and this is exactly what we are doing,” said the PM. He was speaking about the “national capacity to conduct tests for not only new variants that cause COVID-19, but for other viruses that may emerge in the future”.

What does resilience mean in these ongoing discussion­s? The US Economic Developmen­t Administra­tion provides an answer. It says on its website that “economic prosperity is linked to an area’s (or country’s) ability to prevent, withstand, and quickly recover from major disruption­s (that is, ‘shocks’) to its economic base. Many definition­s of economic resilience limit their focus on the ability to quickly recover from a disruption. However, in the context of economic developmen­t, economic resilience becomes inclusive of three primary attributes: the ability to recover quickly from a shock, the ability to withstand a shock, and the ability to avoid the shock altogether. Establishi­ng economic resilience in a local or regional economy requires the ability to anticipate risk, evaluate how that risk can impact key economic assets, and build a responsive capacity”.

The resilience message is gaining traction locally and regionally. Surprising­ly, insurance providers do not appear to be among the early adopters of the doctrine. Below are five examples that show resilience is on the agenda.

• The Barbados-based Caribbean Tourism Organizati­on has developed a multihazar­d risk-management guide for its members. The guide will assist practition­ers in the public and private sectors to prepare for and manage hazards that pose a risk to the tourist industry.

• The Ministry of Industry & Investment is leading a process to improve the resilience in the business process outsourcin­g sector to address, among other things, disaster and disaster outbreaks. The fact that the ministry has sought funding to undertake this task for the benefit of private sector enterprise­s emphasises the importance of the project.

• Tourism Minister Edmund Bartlett is a firm believer in the gospel of resilience. The pandemic, he argued in an April 2021 article in this newspaper, presented the greatest challenge to the sector. Recovery, he said, has become “almost synonymous with resilience building. The sector needs to become more adaptable, resilient, sustainabl­e, inclusive, and competitiv­e.”

• Sangster Internatio­nal Airport is a critical national infrastruc­ture. The airport operators announced before the start of the 2021 Hurricane

Season that the institutio­n was strengthen­ing its disaster preparedne­ss and response plans. One of the co-sponsors, The United Nations Developmen­t Programme, said that it was keen to build capacity and resilience to ensure efficient and effective responses to crises.

• A recent Ministry of Finance audit of the Auditor General’s Department found that the department operated without a business continuity plan. Business continuity planning is the process a company undergoes to create a prevention and recovery system from potential threats such as natural disasters or cyberattac­ks.

Dr Clarke spoke about resilience again last week, this time at the micro level. The Government plans to fast-track the developmen­t of micro insurance as part of its financial- inclusion strategy. He was speaking at the Jamaican segment of the Munich Re-Foundation’s Internatio­nal Conference on Inclusive Insurance 2021, digital edition.

Microinsur­ance products offer coverage to low-income households or to individual­s who have little savings and who are excluded from the traditiona­l insurance system. Microinsur­ance products, to use words attributed to the prime minister, ease the difficult transition­s that this segment of the population faces from time to time.

 ?? RUDOLPH BROWN/ PHOTOGRAPH­ER ?? Minister of Finance Dr Nigel Clarke.
RUDOLPH BROWN/ PHOTOGRAPH­ER Minister of Finance Dr Nigel Clarke.
 ?? FILE ?? Prime Minister Andrew Holness.
FILE Prime Minister Andrew Holness.
 ?? ?? Cedric Stephens GUEST COLUMNIST
Cedric Stephens GUEST COLUMNIST

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