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The International Monetary Fund (IMF) has welcomed the progress made by Jamaica in the implementation of prior actions, for an Extended Fund Facility (EFF) agreement with the Fund.

“Since the conclusion of a staff-level agreement with the Jamaican authorities in February on an economic programme that can be supported by the Fund, the authorities have submitted documentation to the IMF to confirm that all prior actions have been met,” the IMF said in a statement on April 8.

“In addition, the Fund has engaged with the authorities and its development partners on the financing for the programme, including through important contributions from the Inter-American Development Bank and the World Bank,” the IMF added.

The prior actions include: settling a wage restraint agreement with unions representing over 80 per cent of the public sector workforce for the 2013 to 2015 period; introduction and approval, through Cabinet, of a new policy governing discretionary waivers; passage of legislation governing the management of public debt, which was effected in November 2012; and execution of a national debt exchange programme to provide at least 8.5 per cent of the gross domestic product (GDP), which was successfully completed on March 22.

These actions formed the basis of a staff level agreement reached between the government and IMF representatives in Kingston on February 15.

“The success of this programme crucially depends on full and timely policy implementation by Jamaica of a co-ordinated set of reforms, to strengthen the public finances, restore debt sustainability, enhance growth, and bolster the resilience of the financial sector. Recognizing the sacrifice involved for the Jamaican people, the strategy also aims to minimize the impact on the poorest and most vulnerable,” the IMF statement said.

The Fund management will submit to its Executive Board, a 48-month arrangement under the Extended Fund Facility in the amount of SDR 615 million (about $958 million, or 225 per cent of quota), with the recommendation that it be approved. It is expected that the Board meeting will take place by the end of April.

By Latonya Linton, JIS Reporter