3 days ago
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When I first saw the headline to the article I wrote last Sunday – Illiteracy as a societal risk – I immediately sent a congratulatory message to the business editor. Those five words captured the substance of the ideas I struggled to present.
Even though I had a vague notion of the topic for today’s piece, soon afterwards, little did I know that those thoughts and today’s would be associated.
Resilience is a recurring theme in discussions about Jamaica’s economic, infrastructural and social development. The concept describes the ability of an economy to withstand and recover from shocks, such as natural disasters, financial crises, pandemics, or other disruptions.
A resilient economy can maintain its essential functions, adapt to changing situations, and bounce back stronger after facing misfortunes.
Prime Minister Dr Andrew Holness emphasised the importance of resilience during last month’s Global Tourism Resilience Conference. He highlighted the government’s efforts to build fiscal resilience and self-reliance. The importance of a resilient infrastructure to improve the island’s road network and address the impacts of extreme weather events were also the subject of a Jamaica Observer article on February 16. That article was written against the background of widespread criticisms about the poor conditions of the road.
FM (formerly FM Global) is a 200-year old American mutual insurance company with offices worldwide. It specialises in property insurance. The company offers loss prevention services primarily to large, global corporations in the highly protected risk – HPR – market segment. Euromoney magazine called FM the world’s best property insurer.
2025 marks the 12th year that FM has been publishing its World Resilience Index, which captures the relative resilience of a country’s business environment. FM’s index is now recognised a reliable international benchmark of resilience. An international benchmark is a standard or point of reference against which things can be compared or assessed on a global scale. International benchmarks are used to measure performance, quality, or progress in various fields, such as education, finance, business, and environmental sustainability.
The FM index is based on 18 resilience factors that are applied to 130 countries including Jamaica and territories, including Jamaica. Factors include macro risks, such as political risk and inflation, and physical risks, such as fire risk quality and climate exposure.
FM, according to the insurance publication Commercial Risk, said this year that “the index reflects the heavy toll of global conflict, the increasing uncertainty wrought by technological innovation and uneven progress on combating inflation”.
The 18 equally weighted factors in the 2025 Index are: control of corruption, education, energy intensity, GHG or greenhouse gas emissions, health expenditure, inflation, internet usage, logistics, political risk, productivity, urbanisation rate, water stress, together with climate change exposure, climate risk exposure, climate risk quality, cybersecurity, fire risk quality and seismic risk exposure.
The inability or reluctance to control corruption when combined with the poor state of the educational system provided fresh insights into why the Audley Shaw-led National Financial Inclusion Strategy, despite the inclusion of 15 government ministries, departments and agencies, private sector interests, NGOs, organisational and reporting structures, a secretariat, targets, and timeframes has not met its goals, eight years after the announcement.
The authorities at the Ministry of Industry, Investment & Commerce, National Integrity Action, the Integrity Commission of Jamaica and Jampro should be aware that foreign direct investment decisions are often influenced by perceptions of resilience.
The prime minister’s remarks about the importance of resilience should be juxtaposed against the following comments of FM:
Over the last five years, many countries have worked to address their exposure to climate change – for example, by improving building codes to withstand wind and flood risk. In this measure, South Korea and Singapore are among the standouts: They have both improved significantly in the climate risk quality measure since 2021.
It is easy to see why. Both countries also face high climate risk exposures, and they have acted to address them. Singapore, for instance, has implemented a series of policies, including water conservation, clean energy promotion, and sustainable urban planning, to address climate risk and promote greater economic sustainability.
The Index comprises six physical factors and 12 macro factors that combine equally to form the composite score for the 130 countries/territories. Scores are bound on a scale of zero to 100, where zero represents the lowest level of resilience and 100 represents the highest.
Jamaica ranked 107 out of 130 countries and was assigned an overall score of 39.2 points. Its ranking and scores for the physical risks were as follows:
Rank Score
Climate Risk Exposure 124 0
Climate Change Exposure 33 92.2
Climate Risk Quality 102 2
Seismic Risk Exposure 109 0
Fire Risk Quality 110 0
Cybersecurity 109 47.1
The country has an extremely far way to go to achieve economic resilience. it will be interesting to find out from the parties competing for political leadership during the upcoming elections whether this will be one of their goals.
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
English (US) ·