UK’s Decision to Leave EU Could Cost Jamaica Billions in Remittances
The United Kingdom’s decision to ‘divorce’ the European Union could have dire effects for Jamaica based on a recent disclosure by the Private Sector Organisation of Jamaica (PSOJ).
The PSOJ recently expressed it’s concern that Jamaica could end up losing up to $6 billion in remittances as a result of the rapidly devaluing British pound following UK’s decision to exit the European Union.
Less than a full day after the historic referendum, the British pound plummeted to its lowest levels in over three decades.
The pound at one point dipped as low as $1.32 versus the U.S. dollar in overnight trading, a level not seen since 1985.
In fact, the pound devalued when compared to all major world currencies.
By the end of the London trading day on Friday, the pound lost close to 9 percent against the dollar (US).
According to the Gleaner, PSOJ president William Mahfood has stated that an initial economic assessment of the effect of the Brexit vote on the local economy shows that remittances from the UK will be significantly affected.
Mahfood also expressed concern regarding the negative impact the ‘brexit’ will have on Jamaica’s tourism if the British economy declines and leaves people with less to spend on travel.
On Friday, Jamaica’s Foreign Affairs Minister Kamina Johnson Smith also reportedly stated the UK’s decision to leave the EU will have significant implications for Jamaica-UK relations and possibly for Jamaica-EU relations.
Senator Johnson Smith says the UK leaving the EU means that Britain will eventually cease to be part of the relevant arrangements that govern Jamaica-EU relations, including the ACP-EU Cotonou Partnership Agreement and the CARIFORUM-EU Economic Partnership Agreement.
Source: The Gleaner
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