Finance Minister Confident IMF Agreement will Facilitate Growth

Finance and Planning Minister, Dr. the Hon. Peter Phillips, is expressing confidence that the discussions with the International Monetary Fund (IMF), will conclude with the signing of a new agreement that will facilitate growth and development in Jamaica.

Speaking at the Kingston Rotary Club’s weekly luncheon at the Jamaica Pegasus Hotel, New Kingston, on Thursday (November 15), Dr. Phillips cited the “significant progress” that has been made in the discussions, and pointed out that the technical work involved has advanced to the point where “our medium term economic programme has been accepted as the basis for negotiations."

“It is also the case that the essential outlines of the programme to be concluded with the Fund have been settled, and we are at the point of discussing the contents of the draft Letter of Intent,” he informed.

Dr. Phillips said he is cognizant of a “growing level of concern” as to whether the necessary steps can be taken to lift Jamaica out of its current economic challenges, and be placed firmly on a path of sustainable economic development.

He contended that in order for this to happen, there needs to be national consensus and coalescence on some “fundamental” issues, one of which is the IMF. In the same vein, he urged persons to refrain from engaging in efforts to try and “talk down” the economy or “create an atmosphere of doubt, hysteria and fear” in the face of the challenging circumstances.

The Minister also moved to allay concerns expressed over perceived delays in the signing of the new agreement. “Let me, once again, state unequivocally that there is no delay in the process of negotiations, and we are proceeding on the basis of the timetable originally agreed (on) between ourselves and the International Monetary Fund,” the Minister said.

“What we are seeking to do is to negotiate an agreement in the best interest of Jamaica, and with terms that will meet the objectives of development for the people of Jamaica. But, we must first build a consensus around a series of measures that must be implemented if the agreement is to take us where we want to go,” he added.

Reiterating the objectives of the Government’s medium term programme, Dr, Phillips said they include: the virtual elimination of the fiscal deficit by 2015/16, “in other words, a Central Government budget consistent with an overall fiscal balance close to zero per cent of Gross Domestic Product (GDP).”

Additionally, the Finance Minister said the administration is also committed to bringing Jamaica’s debt to GDP down to 100 per cent by 2015/16, while stressing that this “will not be an easy task."

 He further underscored that doing so “will not mean that we have solved the problem of the debt.” To this end, the Minister  cited the need to ensure that “we lock in those gains and continue, even after a programme may have ended, to move the debt to GDP ratio further downwards."

“Most of all, we need to find the mechanisms to ensure that, never again in our country’s history, do we put ourselves in the situation where we allow the debt to mount to these levels…to the point where it threatens to thwart any future progress for the Jamaican people,” Dr. Phillips emphasised.