Review Signals Start of IMF Negotiations

The Article IV review being undertaken by the visiting team from the International Monetary Fund (IMF), signals the start of negotiations for a new Fund programme.

The IMF mission, which has been in the island since March 7, is scheduled to complete its review on March 20.

In a recent statement to Parliament, Minister of Finance, Planning and the Public Service, Dr. the Hon. Peter Phillips, announced the beginning of the formal talks, and reiterated that, “any new agreement with the Fund will be based on the establishment of credible, predictable and achievable macro-economic targets that would inspire confidence among local and international investors, as well as stakeholders."

An ‘Article IV Consultation’ provides the IMF with an opportunity to assess a country’s economic health and is a critical element of negotiations for new agreements.

Addressing a recent public forum, the Finance Minister alluded to the tremendous challenges facing the Jamaican economy with respect to ongoing developments in the local macro-economic environment and spoke to the urgency of securing a new IMF deal.

“The government is moving with alacrity to get things going and the most immediate activity is to finalise a new agreement with the IMF,” he emphasised.

While recognising that difficult adjustments will have to be made, the Minister declared that the Government was “absolutely committed to the preservation of those social programmes necessary for the protection of the most vulnerable and disadvantaged groups in the society."

The current review was preceded by a visit to the island in January by a mission led by the International Monetary Fund (IMF) Mission Chief for Jamaica, Luis Breuer, at the request of the Government of Jamaica.

The meeting with the new Government provided the Fund with an opportunity to “learn about its priorities, and discuss modalities of future engagement."

During those preliminary meetings, the Fund team met with Dr. Phillips; Bank of Jamaica Governor, Brian Wynter; Financial Secretary, Dr. Wesley Hughes; Planning Institute of Jamaica (PIOJ) Director General, Dr. Gladstone Hutchinson; other senior officials, and representatives of the donor community and the private sector.

By Allan Brooks, JIS Senior Reporter