Leah Sahely and Tracy Polius have recently published a multivariate analysis of banking soundness in the ECCU; while Sahely at the ECCU developed a sophisticated and userfriendly template for stress testing. The financial stability department of the Bank of Jamaica, under the entrepreneurial leadership of Dr. Brian Langrin, has produced an impressive stream of technical studies in the area of macroprudential analysis.
Hand in hand went large productivity gains and terms of trade improvements, which were mostly associated with foreign direct investments (share in GDP of 7% was relatively high). Capital flows also contributed to improving financial sector infrastructure, increasing the resilience of the financial system to shocks, and allowing for a smoother and efficient allocation of resources.