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The Jamaican Government has been asked to lead a CARICOM initiative to several multilateral agencies, with the aim of accessing cheaper financing to address the growing indebtedness among middle income countries is the region.
Finance and Public Service Minister, Audley Shaw, speaking at the weekly post-Cabinet press briefing held on Monday (Nov. 5) at Jamaica House, said the request came out of a recent meeting with Commonwealth Finance Minister’s in Guyana, as well as high level talks with representatives of the International Monetary Fund (IMF) and the World Bank in Washington D.C.
“At the (Commonwealth) luncheon where some nine Caribbean countries were present, we met with senior members of the World Bank and there were three Caribbean Prime Ministers there, who are also Ministers of Finance. The Ministers present asked me to lead the initiative to the multilaterals because quite a number of our sister CARICOM countries are in a similar position where they are ranked as middle income but they are heavily indebted and so they have asked me to lead an initiative,” Mr. Shaw informed.
He said that a meeting will be convened shortly with the Commonwealth Finance Ministers to discuss the best way forward in reducing the region’s debt problem. “We are confident that we are going to come up with a formula that will lead overtime to reducing our debt burden, and will lead overtime to reducing the cost of servicing our debt as a percentage of our budget,” he stated.
In the meantime, he said the discussions in Washington D.C were successful, and the multilateral agencies are now seriously considering Jamaica’s position that cheaper money must be accessed to address the indebtedness of middle-income countries like Jamaica.
“At the bi-lateral level, between myself and the principals of the World Bank and the International Development Bank (IDB), they have accepted in principle the persuasive arguments that we have put on the table and in the case of the World Bank, they have said to us that they recognize the need, in their own words, to look at creative financial tools in working more closely with Jamaica and other countries that are in a similar position,” Minister Shaw told journalists.
Adding that the same sentiments were expressed by the President of the IDB, Mr. Shaw said he was confident that “much of this will relate to the quality of follow-up initiatives that will have to be undertaken by my Ministry in how we go forward”.
In the meantime, Mr. Shaw said that he has requested the World Bank to undertake a diagnostic study on corruption in Jamaica. “We recognize that as a new government we have to have a benchmark on how best to govern the country and it is within that context that we have now formally made that request and the World Bank will be undertaking that study”, Mr. Shaw added The study is expected to cost the World Bank approximately $17.5 million (US $250,000).