Ex-Im Bank to Lend More than $4 Billion this Fiscal Year

The Export-Import (EX-IM) Bank proposes to on-lend more than $4 billion over the fiscal year 2007/08.This was announced yesterday (April 12), by Minister of Finance and Planning, Dr. Omar Davies, when he opened the 2007/08 Budget Debate in the House of Representatives.
“This figure, it is projected, will be disaggregated as follows : manufacturing will receive $1.9 billion; tourism and related services, $1.2 billion; and agriculture/agribusiness and agro-processing will receive $1 billion,” informed Dr. Davies.
The Minister pointed out that the bank’s rate of interest to end users on Jamaican dollar loans was 12 percent, which was the “best deal in town.”
Dr. Davies said that the merged Development Bank of Jamaica (DBJ) remained a strong and viable institution with loan disbursement for the past year totalling $1.4 billion.
“About one third of the bank’s loan was to the agricultural sector, facilitated to a large extent by the activities of the National People’s Co-operative (PC) Bank network,” he noted.
The Minister informed the House that borrowers through the PC banks, who were essentially small farmers, were now enjoying single digit interest rates due in part to the provision of resources made available by the National Insurance Fund and the Bank of Nova Scotia.
“In the latter instance, to facilitate on-lending to borrowers at under 8 per cent, the Ministry of Finance provides a subsidy on each loan,” Dr. Davies said.
He added that for this financial year, the DBJ would spearhead a number of projects, aimed at introducing high tech farming techniques, as well as expanding attractions in the tourism sector.
Dr. Davies informed that, “the total loan disbursements through regular lines are projected at $2.1 billion and these will be supplemented by resources from Petro Caribe.”
The Minister said that in relation to the Petro Caribe funds, the DBJ was projecting to use approximately $2.5 billion over the next 18 months, to enable on-lending to tourism and the agricultural/agro-processing sector.
Dr. Davies said it was imperative that the country placed on record again, appreciation for the decision of the Government of Venezuela to convert a portion of each payment made by Jamaica for the purchase of petroleum products into a long term concessionary loan, under the Petro Caribe agreement. “This has placed the Government in a position to make available to the productive sector resources at competitive rates to facilitate expansion of the economy,” he said.