KINGSTON — Minister of Finance, Hon. Audley Shaw, says his Ministry is having discussions with the Inter-American Development Bank (IDB), on structural benchmarks identified by the Government to strengthen the economy and increase its competitiveness.
Speaking at the launch of Jamaica’s National Aid for Trade Strategy on Thursday (October 27), Mr. Shaw said these areas include tax, pension and public sector wage reforms, as well as the establishment of a framework for a credible and transparent system of dealing with the public sector in the medium term.
Pointing out that he had met with IDB Country Representative in Jamaica, Ancile Brewster, and Senior Vice President for Countries, Roberto Valletini, earlier this week to discuss the matters, Mr. Shaw said they are key elements to building competitiveness, particularly within the productive sector.
The Finance Minister stressed that it was his Ministry’s and, by extension, the Government’s prerogative, to ensure a stable macro-economic framework in which private sector led initiatives can “flourish”.
“One of my first acts as Finance Minister was to journey to Washington to meet with the International Monetary Fund (IMF). (I also) met with President Luis Alberto Moreno of the Inter-American Development Bank (IDB), who was the first one out of the block, in supporting Jamaica, and supporting our plan that, first of all, once we were prepared to stick to fiscal prudence and fiscal discipline, we would get access to multilateral funding,” he stated.
Mr. Shaw reiterated that, in exchange for multilateral assistance, the Government has implemented several undertakings including the Jamaica Debt Exchange (JDX) which, added to other performance matrices entered into with multilateral partners, has led to a significant lowering of interest rates.
“We are not short of foreign exchange, (as) gross foreign exchange reserves are at record levels,” he noted.
Mr. Shaw also pointed out that, for the first time in 13 consecutive quarters, the economy recorded growth of 1.4 per cent in March, and the June quarter recorded 2.1 per cent growth, surpassing the 1.5 per cent projection.
“We fully expect growth in September, as well, and we want to continue on this growth trajectory,” he commented
Jamaica’s National Aid for Trade Strategy, developed by the Government in partnership with the IDB, and the United Kingdom’s Department for International Development (DFID), articulates the country’s trade related priorities and is designed to attract and ensure access to investment and aid resources.
In welcoming the Strategy’s launch, Mr. Shaw noted that it comes at a time when the administration is challenged to find fiscal space “in the traditional sense”.
“For too long, we have relied upon public expenditure as a direct charge upon the budgetary process, to spur economic development. And the truth is that, no genuine market economy can proceed and grow in significant increments on the basis of finding fiscal space in the national budget. It just can’t happen,” he emphasized.
“The only way to reduce debt, as a percentage of GDP, is to earn our way to reducing that debt, as a percentage of GDP. My challenge and my mission is to ensure macro-economic stability. We want to keep the stability going. But, ultimately, the long term basis of stability is runaway investment, job creation, and growth,” he concluded.
By Douglas Mcintosh, JIS Reporter