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Prime Minister, Bruce Golding, has declared that the Government will not be going to the International Monetary Fund (IMF) for financial assistance as the country does not have a balance of payment problem.
“You seek IMF intervention when you have a balance of payment problem. We have not had a balance of payment problem for a long time,” the Prime Minister stated, as he addressed the post Cabinet press briefing held on Wednesday (April 8) at Jamaica House.
He noted however that the consequences of the global financial crisis, including the downturn in the bauxite industry and the reduction in remittances, could create some challenges. “We are watching that situation very closely with the fallout of bauxite and alumina, which accounts for 60 per cent of our merchandise export, and if we are only able to keep the JAMALCO plant going for this year, we are talking about possibly only about 30 per cent to 35 per cent of your traditional export capacity that would still be on line,” he pointed out.
He added further: “we know what is happening to remittances, it is still coming in, but the levels have fallen significantly. We have done well in terms of keeping the tourism numbers up, but the tourism spending is down. When you look at that, you have to contemplate the possibility that you could end up with a balance of payment challenge.”
Mr. Golding stated that Jamaica has constantly been engaged with the IMF as “they do their Article 4 assessment here” and indicated that Minister without Portfolio in the Ministry of Finance and the Public Service, Senator Don Wehby, and the Governor of the Bank of Jamaica, Derrick Latibeaudiere, “will be going to Washington to have a meeting with them shortly and that really again is exploratory.”
He informed that the Group of 20 (G20) leaders had provided additional resources to the IMF and had issued certain guidelines in terms of how those funds should be applied and “we have to learn more.”
“We want to make sure that whatever facilities we could possibly require at anytime in the future, we want to make sure that those facilities are available, but as of now we do not have that challenge, but we are in uncharted waters. Jamaica has never been through this before so we are looking at that in the event that this becomes necessary that we would be able to have discussions with the IMF,” Mr. Golding said.
The G20 leaders, at their recent Summit in Europe, committed an additional US$500 billion (

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