Minister of Finance and the Public Service, Dr. the Hon. Nigel Clarke, says Jamaica has a clear path towards recovering from the economic fallout sparked by the coronavirus (COVID-19) pandemic, which will require the Government to focus on specific priorities.
“Our priorities are going to centre around [but not] limited to, economic recovery, maintaining a healthy population, protecting the vulnerable, and maintaining the economic stability that has allowed us to absorb the crisis in the way that we have,” Dr. Clarke outlined.
He was speaking at a session on the theme ‘Going for Growth: Creating Economic Opportunities During Post COVID-19’, during the 16th Jamaica Stock Exchange (JSE) Regional Investments and Capital Markets Conference, at The Jamaica Pegasus hotel in New Kingston, on Wednesday (January 27).
Dr. Clarke noted that Jamaica, like many other countries, had been significantly impacted by the COVID-19 economic fallout.
Among the outcomes, he said, were first quarter 2020/21 fiscal year contraction of 18.4 per cent, and a $72-billion reduction in revenues, while citing projections for an 11.6 per cent contraction in growth for the period.
Dr. Clarke pointed out, however, that Jamaica has been able to weather the impact by virtue of the Government’s access to more than $90 billion at the start of 2020, which was accumulated mainly from privatisations, reintegration of public bodies, and fiscal overperformance.
“We had intended to use [those funds] to accelerate debt repayment. Needless to say, with the pandemic [resulting in] reduced revenue and government facing expenditure pressures for health, social, and economic support, we drew down on those cash reserves. That has allowed us to respond to the crisis, to absorb the shock, provide resources for health and education and also to provide unprecedented social support and, at the same time, to keep nominal debt on an even keel,” he further noted.
The Minister, however, cautioned persons to be cognisant of “the nature of what we face, of how quickly certain dynamics can change and, therefore, the need for absolute clarity and focus, and prioritization”.
Dr. Clarke reiterated forecasts by local and international agencies for a return to growth beginning in the April to June quarter of fiscal year 2021/22, “conditioned, of course, on the health dynamics not taking any significant turn for the worse”.
“We fully expect the [COVID-19] vaccines to be rolled out, beginning in April, and that, hopefully, will mark the beginning of the end [of the pandemic]. We fully expect that we are going to have a [growth] bounce in the April to June quarter, another bounce in the June to September quarter and, indeed, for the 2021/22 fiscal year,” he said.
Dr. Clarke noted that based on its seven per cent out-turn for the July to September 2020 quarter, the construction sector is expected to be pivotal to the recovery effort.
“We believe that construction-based recovery is likely to be our next and quickest way out [of the crisis] and a viable means of providing the foundation on which [Jamaica’s] economic recovery can thrive,” he added.
Emphasising the importance of maintaining the prospects for growth, Dr. Clarke contended that “as long as we remain focused and we approach the crisis with a degree of discipline, economic recovery will be right around the corner”.