JIS News

Inter-American Development Bank (IDB) representative in Jamaica, Mr. Gerard Johnson, has said that the agency’s US$650 million loan agreement negotiated with the Government, represents the largest sum ever to be disbursed to a country as a percentage of gross domestic product (GDP), in the institution’s history.
Speaking at the Private Sector Organisation of Jamaica’s (PSOJ) Chairman’s Club Forum breakfast, held at the Jamaica Pegasus Hotel, New Kingston, on March 23, Mr. Johnson pointed out that the IDB’s unprecedented input surpasses the US$400 million in loans to Jamaica in 2008 and 2009.
He informed that most of the money, which represents 20 per cent of GDP, would be disbursed during the first 12 months of the 27-month International Monetary Fund (IMF) agreement that was penned recently.
The sum will assist the country with its balance of payments and other obligations, which have been impacted by the global economic recession that has significantly affected revenue inflows from traditional sources, such as bauxite.
The IDB has already disbursed some US$200 million. The provision of additional funding is contingent on the administration meeting specific targets, inclusive of a reduction of the fiscal deficit and effecting a reform agenda.
“You are in a recession and you have no fiscal stimulus, that’s a very bad combination. Now, we could have chosen to sit on the wall, as others have done and say, well, ‘talk to us next year’.but we are about development,” Mr. Johnson said.
“Our analysis is that it would be better for us to help you to make your target rather than wait for you to make it,” he added.
The US$200 million already made available by the IDB carries an interest rate of 1.23 per cent, a five-year grace period and 25 years amortization.

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