PM and Finance Minister to Discuss IMF Funding Arrangement with Social Partnership Group

Prime Minister the Hon. Bruce Golding and Minister of Finance and the Public Service, Hon. Audley Shaw, will meet with the social partnership group on June 25 to discuss the terms under which the country should enter into a funding arrangement with the International Monetary Fund (IMF).
This follows a directive from Cabinet for Government to explore the IMF stand-by facility in order to keep the country’s medium-term economic programme on track. This decision arose from a technical report submitted by Mr. Shaw on the possible need for additional financing through the IMF. The social partnership group comprises representatives from the private sector, trade unions and the opposition.
Minister without Portfolio in the Office of the Prime Minister with responsibility for Information and Telecommunications, Hon. Daryl Vaz addressing the Wednesday (June 24) post-Cabinet press briefing at Jamaica House, said that a team from the Ministry of Finance would be going to Washington during the first week of July, following which, an IMF team would visit the island. All discussions emanating from these deliberations will be reviewed by Cabinet toward the end of July.
“What (Cabinet) mandated the (Finance) Ministry to do is to continue the exploratory discussions with the IMF. Whether or not we go back to the IMF is all dependent on what comes out in relation to these discussions, in relation to the specific terms, which is what has to be nailed down, so that the Government clearly understands what it would mean to the Government and the people of Jamaica for a return to the IMF,” Mr. Vaz outlined.
In his budget presentation last month, Prime Minister Golding said that while the Government was not in a hurry to borrow from the IMF, it must lay the groundwork to cushion the economy.
“I am approaching it reluctantly, but if the circumstances require that we do it, we would have to. The reasons why we might have to go back there has to do with our balance of payment…remember that we have lost more than two thirds of our bauxite earnings, and bauxite accounted for 60 per cent of our total earning, that’s a major blow,” he told the House.
Mr. Golding, at the time, pointed out that the Net International Reserves (NIR) have been under pressure, and that the Government wanted to be in a position where, if funds from the NIR were being drawn down to the point where a market confidence crisis might occur, a funding facility would be in place.