JIS News

The government will be amending the Petroleum Corporation of Jamaica Act to make provisions for the formal establishment and operation of the PetroCaribe Fund.
Finance and Planning Minister, Dr. Omar Davies, who made the disclosure in Parliament on March 8, said that the process by which the fund would be managed had already been taken to Cabinet.
He informed that a board of directors would also be appointed to oversee the facility, which is financed through savings from the PetroCaribe oil deal with Venezuela.
Dr. Davies was responding to questions raised by Opposition Spokesman on Finance, Audley Shaw, regarding the use of Fund.
Mr. Shaw expressed concern, that while money had been expended from the Fund for a road project, this was done without Parliament’s approval.
“This cannot be allowed; it must come before Parliament for approval,” Mr. Shaw argued, stating that the money should be brought into the Consolidated Fund and approved by Parliament, or legislation enacted to establish a special fund. He urged that no further expenditure be made until the necessary provisions were made, “to ensure that the funds are spent in ways, which are beneficial to the country”.
Mr. Shaw also requested that Parliament be provided with information about expenditure under the $1.1 billion Universal Access Fund, which is financed from the levy on telecommunications companies for incoming calls.
The fund is intended to provide financing for the e-learning project, which will be implemented in 150 high schools island wide over the next several years.Dr. Davies assured the House that Education, Youth and Culture Minister, Maxine Henry Wilson, would bring a Ministry Paper to Parliament soon, stating how the facility would be utilized.
In the meantime, the Finance and Planning Minister said that despite the economic challenges of last year, the country managed to maintain credibility in the capital markets, evidenced by the successful issuing of a 30-year bond at an interest rate of 8.5 per cent.
Turning to the $877 million reduction in the 2005/06 budget, as contained in the First Supplementary Estimates tabled in the House on March 7, Dr. Davies said that the adjustment was considered necessary “as it was common knowledge that revenue inflows had been adversely impacted by the set of unusual circumstances, which has characterized the country and the region during the last fiscal year, in terms of natural disasters.”
He noted however, that the government would be keeping expenditure levels as close as possible to original projections.
Dr. Davies indicated, that because the administration would be faced with significant additional expenditure for reconstruction in the coming fiscal year, there were no plans to put forward a balanced budget for the 2006/07 period.
On the issue of growth, he said estimates show a growth of over four per cent for the third quarter of 2005/06, and indicated that the trend should continue into the first quarter of 2006 and the final quarter of the current fiscal period.
He said one clear sign of the improvement in the economy was reflected in the construction sector, driven mainly by investments in hotel construction and the continued improvement of the airports as well as Highway 2000.