KINGSTON, Jamaica – YESTERDAY the Chicago Tribune (President Obama's major hometown newspaper and one of the top five newspapers in the US) wrote an editorial with the title “Jamaica's Debt Hurricane”, subtitled “The Greece of the Western Hemisphere”. The editorial argued that Jamaica, like Greece, “illustrates the catastrophic effects of borrowing way too much, and the painful choices that follow”.
In analysing the editorial's comparison of Jamaica and Greece, it is first necessary to correct a couple of factual errors. The editorial made the very strong statement that Jamaica “is in worse financial shape than Greece: Jamaica has more debt in relation to the size of its economy than any other country”. If this statement is measured by the debt as a percentage of GDP, then Greece, with debt between 160 to 170 per cent of its GDP even after a very onerous debt restructuring (reduction) in March 2012, is clearly much worse than Jamaica, with a debt of between 130 to 140 per cent of GDP, depending on whether you include our Petrocaribe debt.
