If I were the king of Jamaica, I would, strangely enough, be Charles III. This is already a serious obstacle to my ambitions, since I am neither Charles nor the third of anything.
Yes, Jamaica has a king of Jamaica, and it is King Charles III, the very same one who is the king of the United Kingdom. But aside from the weirdness of Jamaica retaining the king as a figurehead, Jamaica is a constitutional monarchy governed by the rule of law. Maybe someday they will get rid of the king, become a democratic republic, and start driving on the right side of the road.
But I digress. After spending a week at an all-inclusive resort in Jamaica, I found myself wondering how much of what I consumed was actually produced in Jamaica. The resort might be located in Jamaica, but how much of its economic activity was Jamaican? Having visited Singapore, Taiwan, Okinawa, and Indonesia, and read several books on their histories and economies, I found myself making some interesting comparisons.
The real ambition of this post is to indulge in the hubris of trying to determine Jamaica’s economic future. It’s not that I know better than the people who run Jamaica or who have ambitions to run for office there, but I think it’s an interesting exercise to see Jamaica through an economic lens. If nothing else, it gives me a framework for thinking about the money architectures that lie at the base of every country’s Babylon. I picked up Babylon from Kei Miller’s Augustown. It refers to the system of power that dominates and represses Jamaican society, or perhaps any society.
One thing you might have noticed is that I like the phrase “money architectures.” I think it’s more useful than “economics” or “economy.” Economics claims to be a science, but I think it’s better described as a machine, a very complicated machine, but a machine, nevertheless, constructed by people to serve people. Money architecture suggests that the machine is designed and can be re-engineered to serve use cases of users. Economics suggests that it operates on scientific principles beyond our control that we can only discover and obey. The machine parts are currencies, laws, central banks, treasury departments, and so on, but they are all part of a complex machine that computes how to allocate resources. Value and meaning lie in our collective heads, not in the laws of physics.
Nature doesn’t make washing machines. They exist only in our minds. At this point, you may want to drop one on my head to prove me wrong. But my point is, we give meaning and purpose to the washing machine’s use and construction, and you wouldn’t call a washing machine science, would you?
In my view, Babylon is not the machinery itself. Babylon is what happens when the machinery of economic and political power serves domination rather than human flourishing. The money architecture facilitates both Babylon and escape from Babylon. It’s the tool that preserves the current power structure and the means to change it. When money architecture is used to extract, control, and impoverish, it becomes Babylon.
So let’s proceed with the fantasy. Let’s make Jamaica its own Zion—not an economy free from foreign relationships, but one free to determine the terms of those relationships. I am the sovereign king of Jamaica. How do I make Jamaica become more than a product of Babylon and more than a prisoner of its history?
My first royal decree is to abolish foreign dependence. My finance minister informs me that this is not how foreign dependence works. Before ordering him to the dungeon, he proposes a more useful strategy than a royal decree.
Jamaica could use its ability to create Jamaican dollars to reduce its future need for US dollars. Monetary sovereignty could become a tool for building productive sovereignty. Recall the definition of productive sovereignty: the practical ability to mobilize labor, technology, resources, and institutions to meet society’s needs. It is not the same as self-sufficiency, as it includes the ability to trade competitively, develop alternative suppliers, and adapt when international relationships change.
Despite having its own fiat currency, Jamaica cannot print the dollars it needs to purchase foreign goods or service foreign debts. Its challenge is not simply foreign debt, but dependence on foreign sources. Jamaica needs to turn more of its fiat into productive capacity, and less of that capacity into a permanent need for foreign currency.
I can hear the sighs and groans. “Oh, is that all.” Yes. That is all. That is where the hubris comes in.
As king, I want to design an economic system that gradually reduces its external dependencies while increasing its capacity to satisfy domestic needs.
The design principle is:
- Use monetary sovereignty to mobilize domestic resources.
- Allocate available foreign-exchange resources toward investments that reduce future foreign-exchange requirements or increase foreign-exchange earnings.
This is a hybrid financing model. Use domestic currency for domestic productive resources, foreign currency for essential imports, and future foreign-exchange savings to strengthen the country’s external position. There are three categories of worthwhile investments.
First: projects that reduce essential imports. These include renewable energy, improved agricultural productivity, water infrastructure, and energy-efficient buildings. Their economic value comes in part from reducing the foreign currency Jamaica must spend to maintain its standard of living. Renewable energy is particularly promising because it supports nearly every other industry. Cheaper electricity could improve manufacturing competitiveness, reduce agricultural processing costs, and boost domestic business profitability.
Next: projects that increase foreign-exchange earnings. These include software development, specialized business services, agricultural processing, cultural exports, and higher-value tourism services. The objective is not import substitution but developing new capabilities that foreigners will buy. Unlike bauxite mining, exporting software does not require extracting a finite mineral resource. Unlike tourism, software services do not necessarily require customers to travel to Jamaica. But such a program would succeed only if education, infrastructure, market access, and business development created internationally competitive services.
Training people without generating employment opportunities could simply accelerate emigration. Jamaica’s diaspora could become part of its productive architecture through investment, professional networks, remote work, technology transfer, and temporary return programs. The objective need not be preventing Jamaicans from leaving. It could be creating an economy in which leaving does not sever productive connections with Jamaica.
Finally: projects that improve domestic productivity. These include transportation, technical education, public health, security, digital infrastructure, and institutional capacity. They may not generate direct foreign-exchange savings, but they can improve the productivity of other investments. Suppose Jamaica develops a better agricultural distribution network. Farmers lose less produce to spoilage. Retailers receive more reliable supplies. Consumers face lower prices. Restaurants and hotels can purchase more food domestically. One investment can benefit several sectors.
The strongest development strategy would combine all three types of investments rather than treating import substitution and export growth as competing objectives.
As king, I could simply instruct the Bank of Jamaica (BoJ) to credit my account with newly created money to finance my development programs. Unfortunately, the reality is not as simple. Jamaican law generally prohibits the government from borrowing directly from the central bank, with limited exceptions for declared emergencies. To satisfy my kingly orders, the Jamaican government will have to change the legal framework or pursue other strategies, such as issuing J$ bonds, securing development bank lending, or launching public-private investment programs and subsidies. Alternative approaches may be less than ideal, but they would at least use Jamaican currency.
The foreign-exchange problem still has to be dealt with. The foreign currency has to come from somewhere. Tourism, exports, remittances, and investment already earn substantial foreign exchange. Jamaica has also maintained reserves in US$. But reserves serve other important purposes, including maintaining confidence in the currency and providing liquidity during external shocks, like Hurricane Melissa.
Suppose we were to decrease Jamaica’s dependence on imported fossil fuel energy. I would have to construct a solar power installation. While the king could decree that the sun shall provide Jamaica’s electricity with little argument from the sun, the solar-panel manufacturers insist on being paid in US dollars.
I would need Jamaican labor, land, construction services, imported solar panels, electrical equipment, and batteries. There are two separate financing problems. I would use domestic financing to pay the Jamaican workers and businesses. I would use foreign financing to acquire the imported equipment.
These two methods of finance suggest a way to evaluate investments beyond simple deficit spending. A project should be judged not only by its financial return, but also by its contribution to Jamaica’s future productive capacity and external resilience.
For a solar power installation, it would initially increase demand for foreign currency but subsequently reduce it as the need to import foreign energy decreases. Borrowing foreign currency to acquire productive assets that reduce future import requirements can increase our productive sovereignty, whereas borrowing to finance ongoing consumption generally does not. Both may be worthwhile, but their long-term consequences differ.
Suppose the project requires a US$ 100 million investment today but saves US$ 20 million annually for the next twenty years. That project will net a positive US$ 300 million in undiscounted, future foreign-exchange benefit. Of course, a dollar saved twenty years from now is not worth the same as a dollar saved today. So a more useful measure discounts future savings to their present value. The other project nets nothing. This example is illustrative only. It assumes constant annual savings and no additional FX costs, replacement expenses, or residual value.
This suggests a simple project-level measure:
Net FX Benefit = Sum over project lifetime t ((FX earned + FX saved – FX operating costs)/ (1+r)^t ) – Initial FX investment
Here, FX is foreign exchange, r is the discount rate, and t indexes the years the project operates. The project discount rate reflects the opportunity cost of foreign capital, financing costs, project risk, and the chosen social or economic valuation method. A positive value indicates the project is expected to improve Jamaica’s foreign-exchange position over its lifetime, relative to the baseline.
Even expenditures denominated entirely in Jamaican dollars can increase import demand, depending on how recipients spend the Jamaican dollars. The key concept here is import propensity: how much additional foreign-exchange demand an increase in domestic income or investment generates. A more complete evaluation of a project would account for both its direct foreign-exchange requirements and its indirect effects on imports.
That does not mean every project must have a positive foreign-exchange return. Hospitals, schools, and public safety investments can be socially valuable even when they do not directly earn foreign currency. But for an industrial development program explicitly intended to reduce external dependence, this would be the key metric.
The initial FX investment might be substantial. How would the initial outlay be financed until the investments begin generating returns? This king doesn’t have US$500 million lying around to kick-start the program.
So let’s establish a dedicated development facility to provide the initial financing. We could capitalize it through a combination of concessional development loans, foreign investment, export earnings, and carefully managed public contributions. The facility would finance imported equipment for projects that satisfy rigorous economic criteria. The domestic portions of those projects would be financed separately in Jamaican dollars. As the projects begin saving or earning foreign currency, participating enterprises would make payments into the facility under their financing agreements.
The facility could then finance additional projects. It would effectively recycle foreign-exchange benefits into new productive investment. An important limitation is that foreign-exchange savings are not automatically cash received by the government.
If a private utility imports less fuel, the foreign exchange remains with that company or elsewhere in the economy unless a contractual repayment, tax, or other mechanism channels some of the benefit to the facility. The repayment mechanism must not destroy the incentive to invest. Participating enterprises commit a negotiated portion of their verified foreign-exchange savings to repayment, while retaining enough to reward the investment. Also, the government need not own the productive assets to direct development. It can structure financing to align private returns with public objectives.
Therefore, the financing contracts would have to establish how the revolving fund is replenished, but the principle is workable. Rather than continuously borrowing foreign currency to support consumption or replace depreciating infrastructure, Jamaica would increasingly use foreign currency to acquire assets that reduce future external requirements.
A national development program could be treated as a dynamic system that continually observes its condition, compares outcomes against objectives, and adjusts its behavior.
Instead of merely declaring that Jamaica should spend J$100 billion on development, the government would declare measurable economic objectives.
For example:
- Reduce the imported-fuel requirement per kilowatt-hour of electricity generated.
- Increase the proportion of hotel food purchases supplied by competitive Jamaican producers.
- Reduce agricultural spoilage.
- Increase the value of exported professional and technical services.
- Increase real output per worker.
The system would continuously evaluate whether investments were moving the economy toward those objectives, and adjust it when they were not. The development facility should have operational independence, transparent accounts, publicly reported outcomes, and independent audits. The government establishes strategic priorities. The facility evaluates and finances projects against those priorities. Independent institutions verify performance.
As king, I would naturally expect all my economic predictions to be correct. As an engineer, however, I would insist on measuring them.
Consider the following feedback loop:
- Observe: Measure unemployment, inflation, import requirements, foreign-exchange reserves, productive capacity, and project performance.
- Compare: Determine whether actual outcomes match the expected domestic and foreign-exchange benefits.
- Plan: Prioritize investments that address the most significant productive constraints.
- Apply: Finance and execute selected projects.
- Update: Revise financing, investment priorities, and economic assumptions based on observed results.
Interestingly, those are the exact steps I use in the declarative reconciler software that I am building. We kings have many interests and talents.
Suppose the program is expanding domestic investment, but inflation rises. As king, I could order inflation to stop. But then what use would I have for the central bank governor?
Spending might have to be reduced. MMT tells us that not all inflation is the same, so we need to determine why. Not every rise in inflation shows that government spending is excessive.
If inflation results from excessive domestic demand, slowing expenditure might be appropriate. If inflation results from imported fuel prices, reducing domestic investment might do little to address the underlying problem. If foreign-exchange reserves are declining because equipment imports have surged, the government might delay import-intensive projects while continuing domestic training and preparatory work.
The response should depend on the constraint being encountered. Even supply-driven inflation can require monetary or fiscal responses if it threatens to become persistent. Productive investment is not automatically exempt.
One complication is that Jamaica is currently recovering from Hurricane Melissa, which struck in October 2025. Jamaica must rebuild damaged productive assets before it can fully pursue new development opportunities. But reconstruction also creates an opportunity. Instead of simply replacing destroyed infrastructure, Jamaica could prioritize rebuilding it in ways that reduce future economic vulnerabilities.
For example, rebuilding electricity infrastructure could incorporate more distributed renewable generation and resilient transmission systems. Reconstructing agricultural infrastructure could include better water management, storage, and climate protection. Restoring transportation networks could improve access between rural producers and urban markets.
The difficulty is that reconstruction creates immediate demand for imported materials, equipment, and skilled labor. Reconstruction spending could increase inflationary pressure and foreign-exchange demand. So the challenge is not simply finding money. The challenge is sequencing investment so the economy can absorb it.
Up to this point, we have largely treated Jamaica as a unified economic actor trying to maximize national prosperity. But an economy consists of individuals, firms, institutions, and political interests with different objectives.
Consider an importer who earns substantial profits selling foreign agricultural products in Jamaica. A domestic agricultural development program might reduce those profits. An electricity supplier might resist reforms that threaten existing investments. A financial institution might prefer purchasing government securities to financing riskier industrial projects. A politically connected business might seek subsidized credit without making the productive investments the program was intended to support. These are not uniquely Jamaican problems. They are inherent difficulties of industrial policy.
So who decides which investments deserve public support, and how do we prevent the financing mechanism from becoming a way to transfer wealth to politically favored businesses?
Of course, as king, I would decide. But I can’t always be there. So I would impose three requirements.
- Investment criteria should be public and measurable.
- Financing should be tied to independently verified milestones, with provisions for recovering funds when borrowers fail to meet their obligations.
- Unsuccessful projects should be allowed to fail rather than receiving indefinite public subsidies.
Industrial policy needs experimentation, but experimentation only produces useful knowledge when failure has consequences. There is an important difference between a government that strategically invests in productive capabilities and one that indefinitely protects inefficient enterprises.
Success is more than GDP growth. GDP is useful, but it can obscure the economic structure we are trying to change. Other metrics include: labor productivity, imported energy per unit of GDP, food import dependence, export diversification, domestic value added in tourism, foreign-currency debt exposure, real median household income, poverty, foreign-exchange reserves, and public debt sustainability.
The important outcome would not be eliminating imports or achieving a trade surplus at any cost. It would be developing an economy that can support higher living standards without becoming increasingly vulnerable to foreign creditors, exchange-rate movements, or external supply disruptions.
The government should evaluate the broader economic consequences, including how each investment affects Jamaica’s future range of choices. Call this a sovereignty return: the improvement in a country’s ability to make economically viable decisions without being constrained by critical external dependencies. It is not a standard economic metric, and it would need careful definition to avoid double-counting benefits already captured by conventional cost-benefit analysis. Nevertheless, it identifies something worth measuring.
Monetary sovereignty is an instrument, not the objective. MMT suggests that government debt should not automatically be understood as a burden passed to future generations. The more meaningful question is what future generations inherit in exchange for that debt.
Do they inherit productive infrastructure, better education, technological capabilities, and greater economic resilience?
Or do they inherit deteriorating infrastructure, weak institutions, and financial obligations unsupported by additional productive capacity?
The government could finance domestic productive investment through Jamaican-dollar borrowing and, within its legal framework, monetary and credit policies that support development. But it must also ensure that the resulting economy can better obtain or conserve foreign currency. Otherwise, domestic monetary expansion could simply increase imports, weaken the exchange rate, and recreate the financial dependence it was intended to overcome.
Jamaica has spent more than a decade establishing fiscal credibility, reducing debt, strengthening its central bank, and rebuilding international financial confidence. A poorly designed monetary-financing experiment could destroy some of that progress. But excessive fiscal caution could also leave Jamaica with insufficient investment in the productive capabilities needed for long-term prosperity.
As king, I would seek to preserve the benefits of financial stability while using Jamaica’s earned fiscal and monetary capacity to accelerate productive development. And that suggests a more ambitious economic framework than either conventional austerity or unrestricted deficit spending. It would combine monetary sovereignty, industrial policy, foreign-exchange management, and measurable productive outcomes into a single development strategy.
Sovereignty is not the absence of dependence. It is the capacity to choose among dependencies. No modern economy is independent. Even the largest countries depend on international trade, specialized knowledge, and external resources. What distinguishes a resilient economy is its ability to adapt when those relationships change.
So by kingly decree, I ordain that:
The purpose of development finance should not merely be to increase the amount of money circulating in an economy. It should be to increase the economy’s capacity to produce the goods and services that money is intended to purchase. Use today’s access to foreign resources to reduce tomorrow’s vulnerability to losing that access.
Of course, none of this guarantees success. Some investments will fail. Some industries will never become competitive. Some of my royal decrees will prove spectacularly misguided. But the objective is not to design a perfect economy. It is to design an economy that can learn, adapt, and become more productive without becoming more dependent.
And perhaps that is the most important distinction between Babylon and Zion. The same machinery of money, law, and institutions can perpetuate dependence or expand a society’s possibilities. The difference lies not in the machinery itself, but in what we design it to accomplish.
Now that’s out of the way. Let’s get back to the important business of getting drivers on the right side of the street where they belong.