Financial Analyst Says no Alternative to EFF

Financial analyst, Ralston Hyman, says  if the Government had not negotiated and implemented the existing International Monetary Fund (IMF) four-year Extended Fund Facility (EFF), the economy would have worsened.

Speaking on the Jamaica Information Service (JIS) Television ‘Issues and Answers’  programme,  on March 20, Mr. Hyman said no alternative to the EFF was available to reduce the national debt and spur economic growth. Against this background, he contends that “we just have to stick to the programme.”

“The more we stick to the programme and the more we meet the targets, is the more investor confidence builds and the more investments we will get, and the more we will be able to accelerate economic growth and create jobs which is, ultimately, what (the country needs),”  he added.

Mr. Hyman, who is also a member of the Government’s Economic Programme Oversight Committee (EPOC), noted that over the last 50 years, Jamaica has recorded cumulative economic growth totalling 40 per cent, which he attributed to “a number of factors.”

These, he indicated, include: high debt and fiscal indiscipline, and low productivity levels, developments which led to the country falling out of favour with multilateral funding agencies and investors, locally and globally. Hence the need for the government seeking the IMF’s intervention.

“The major function of the IMF is to provide balance of payment support (for accumulated debt). Therefore, the more we meet the IMF performance criteria, is the more we will build confidence. So, the money that we get from the IMF, that is not as important as the confidence which the IMF seal of approval provides for investors and suppliers,” he argued.

Mr. Hyman pointed out that with confidence comes potential investments, which will ultimately generate jobs, leading to economic recovery and growth. He noted that activities undertaken to this end, thus far, have borne fruit.

“We saw in the September quarter, that the recovery was 0.6 per cent, then we moved to 1.4 during the December quarter; we expect this to continue. Recovery is being driven by investments and expansion in outputs in many sectors of the economy, such as agriculture, mining, and real estate,” he pointed out.

Mr. Hyman said the measures being implemented under the EFF and Economic Reform Programme (ERP) “are not things that (the Government is) doing for doing sake…these are important to the stability of the economy, and everyone will benefit  from that stability.”