JIS News

Story Highlights

  • International Monetary Fund (IMF) Representative in Jamaica, Dr. Bert van Selm, says the country is positioned to achieve increased economic growth of up to three per cent over the medium term.
  • The IMF official said falling global oil prices will be a key factor in spurring growth.
  • The IMF in its latest World Economic Outlook forecast report, published on January 2015, is projecting that the world economy will expand by 3.5 per cent this year and 3.7 per cent next year, with the US expected to grow 3.6 per cent this year.

International Monetary Fund (IMF) Representative in Jamaica, Dr. Bert van Selm, says the country is positioned to achieve increased economic growth of up to three per cent over the medium term.

This, he said, is based on the Government’s timely implementation of the Economic Reform Programme (ERP), being supported by the IMF’s Extended Fund Facility (EFF).

“The bottom line, really, is that Jamaica is very well poised…for….higher economic growth in 2015, but also…over the medium term. So, for 2015, we project two per cent economic growth, which is….a (little) higher than Jamaica has seen over the last several years. For the medium term, we project growth…to be a little bit higher than that, in the range of 2.5, maybe three per cent,” Dr. van Selm said.

He was speaking at Sagicor Group Jamaica Limited’s pension investment seminar held on Tuesday (March 3), at the Jamaica Conference Centre, downtown Kingston.

Dr. van Selm, in his address, said that emerging economies, like Jamaica, should benefit significantly from growth in advanced economies, particularly in the United States (US).

The IMF in its latest World Economic Outlook forecast report, published on January 2015, is projecting that the world economy will expand by 3.5 per cent this year and 3.7 per cent next year, with the US expected to grow 3.6 per cent this year.

“We (anticipate) much stronger United States (US) growth in 2015, than over the last few years, and for a country like Jamaica, this is very helpful because…the US is where the bulk of the remittances (and) tourists are coming from…(and) this is critical for Jamaica’s economy,” Dr. van Selm said.

The IMF official said falling global oil prices will be a key factor in spurring growth.

“We have seen a very sharp decline in the price of oil recently, which… is very positive for the Jamaican economy… (in terms of global) competitiveness in electricity prices,” he said.

He argued that many of Jamaica’s competitors, such as Mexico and the Dominican Republic, have much lower electricity prices, because they do not depend on imported fuel to generate that electricity.

“With global oil prices coming down (and) electricity prices in Jamaica coming down, you are coming much closer to… your competitors’ (level), so this is also excellent news for Jamaica,” he contended.

Dr. van Selm said the lower global oil prices and domestic electricity costs should result in a further decline in inflation.

“Lower oil prices lead to lower (domestic) fuel and electricity prices…and that also feeds through to other prices, because electricity and fuel are used for producing other goods and services. So that (should be) welcome for everybody, (and makes more resources available to persons) and, therefore, increases (their) purchasing power,” he argued.

The annual Sagicor Group pension investment seminar was held under the theme: ‘Unlocking Investment Opportunities in Jamaica’.

Other speakers included: Chairman, Sagicor Group and Pension Investment Fund (PIF), R. Danny Williams; and President and Chief Executive Officer, Richard Byles.