JIS News

Prime Minister the Hon. Bruce Golding says that Jamaica will only contemplate resuming a borrowing relationship with the International Monetary Fund (IMF), if the country faces significant deterioration in its balance of payment.
But Mr. Golding, speaking in the Budget Debate at Gordon House today (May 5), assured Parliament that the Government was prepared to engage the Opposition in looking at options, should the need arise.
“I have instructed the Minister of Finance, the Governor of the Bank of Jamaica and all the Government’s technical officers to make themselves available for such discussions,” he told the House of Representatives.
“I suggest, respectfully, that it is not in the country’s interest to make this a political cause celebre. With the freezing of the capital markets, the significant fallout in bauxite/alumina which accounts for almost 60% of our total export earnings, the decline in remittances and capital flows, we could find ourselves having to draw down on the reserves beyond the margin of safety. We are prepared to discuss all these issues with the Opposition. The country’s interests are at stake,” he added.
Mr. Golding also welcomed the support of the business sector, stating that partnership with the private sector was vital, if the country is to improve its business environment.
“We have established a consultative body, the Partnership for Transformation, which has identified a range of key issues and the policy actions required to address them. We have achieved some of the targets. Some others and their timelines have been affected by the impact of the global crisis, but our vision remains clear and our commitment is strong,” he said.
He recalled that the Government has engaged the private sector, trade unions and the Opposition in consultations toward a Social Partnership, recognising the critical role that each has to play in moving the country forward and in building a consensus around strategic objectives.
“That consensus is needed now more than ever before. None of us can make it on our own. We can’t go forward without you. You won’t reach anywhere without us. We have to make the journey together,” the Prime Minister said.
“There are differences that must be ironed out and trust that must be built. It is a call to leadership. We must surround the wagon; we must get it fixed so that we can set out on our journey,” he noted.
He said that the Government will be undertaking a “careful” review of the existing range of incentives, to determine their effectiveness.
Many of them were instituted more than 40 years ago in a completely different era and environment, Mr. Golding said.
“For example, the distinction between export and domestic industries may have been appropriate at a time when we were a closed economy, domestic industries had a captive market and it was exporters who had to contend with competition in overseas markets. In a liberalised economy, that distinction virtually disappears since domestic industries are faced with foreign competition in the domestic market,” he explained.
“A dollar earned is as valuable as a dollar saved. Domestic industries may not earn foreign exchange but, if they don’t produce what they produce, we would have to find the foreign exchange to import it,” he pointed out.
Mr. Golding said that the Minister of Finance, along with the Ministers of Industry, Investment and Commerce, Tourism and Agriculture will lead that review and engage all the stakeholders in consultations.