JIS News

Minister of Finance and the Public Service, Hon. Audley Shaw, says the fiscal and legislative achievements Jamaica recorded in 2010, have presented opportunities to overcome the global economic crisis.

Speaking at the first Mayberry Investments Limited's monthly Investors Forum for 2011, at the Knutsford Court Hotel, New Kingston, on Wednesday (January 19), the Minister described 2010 as a "make or break year".

He commented that the year "saw us on the edge, away from the precipice", adding that "we had to move to achieve macro-economic stability".    

Mr. Shaw said notable among the achievements was the $41 billion in gross savings to the Government, which implementation of the Jamaica Debt Exchange (JDX) initiative yielded by reducing interest rates on $700 billion of domestic debt from an average 17 per cent to 12 per cent. 

"We could not have done that without the voluntary participation of 99.2 per cent of all of our stakeholders. It has now become a model that the International Monetary Fund (IMF) is using and making references to, globally," he pointed out.

Mr. Shaw said the country has been enjoying an appreciation of and stability in the exchange rate, since January 2010. He pointed out that this has been influenced, in part, by the Government’s “aggressive” re-engagement” with multilateral institutions, including the World Bank, Inter-American Development Bank (IDB), and Caribbean Development Bank (CDB), as well as projected inflows of US$1.27 billion from the IMF’s standby agreement.

This has resulted in the Net International Reserves (NIR) continuing to be healthy, he said. He added that, currently, the NIR stands at over US$2 billion, representing approximately 14 weeks of imports, and gross reserves at the Bank of Jamaica amount to US$2.9 billion, the largest in Jamaica’s history. 

Mr. Shaw said the administration managed to keep a rein on the inflation rate, despite a spike in December, partly occasioned by an increase in domestic food crop prices. He was optimistic that the figure can be kept in the range of eight per cent for the remainder of the fiscal year.

He stated that the administration reduced Treasury Bills rates to an all time low, with auction rates at eight per cent, the lowest in 33 years, with the interest rate on the BOJ’s open market operations currently at 7.4 per cent.  

In light of these developments, Mr. Shaw urged the nation to commit to making 2011 a "comeback" year, as the country moves to recover from the global economic implosion, as well as challenges associated with extreme weather conditions

"We are cautiously optimistic already that, in the fourth quarter of the fiscal year, we will, possibly, begin to see some growth in the economy," he declared.

"There is already some evidence of that, but we are cautiously optimistic. We have to build on the fiscal and legislative achievements of 2010, and the private sector needs to seize the opportunities that are arising from a stable environment,” Mr. Shaw asserted.