On 30 September 2013, the Executive Board of the IMF approved the completion of Jamaica’s 1st review under the IMF’s four-year Extended Arrangement which was agreed to on 01 May 2013, paving the way for a second draw-down under the programme (SDR 19.97 mn). This approval also paves the way for the receipt of support from other multilateral development partners, including the IADB and World Bank, towards the end of this year. Despite major challenges, the GOJ comfortably met all the quantitative conditions for the 1st review and the structural benchmarks (as well as the associated indicative commitments) were implemented in a timely manner.
The major challenges in the first quarter of the programme stemmed from a weaker than anticipated global and domestic economic environment. Notwithstanding, the IMF Staff in its appraisal concluded that “overall policy implementation under the programme has been strong and structural reforms are progressing”. Of note, the primary balance and tax revenue targets were attained. At the same time the GOJ was able to meet its programmed commitments with respect to social protection expenditure. This overall performance followed our successful completion of our own programme targets in March, and significantly follows the implementation of stringent prior actions earlier in the year.
Jamaica’s creditable economic performance was also underscored by the recent upgrade by Standard & Poor’s, which noted that the Jamaican economy has stabilized and expressed their expectation that the country’s ambitious fiscal targets for this year will be met.
The Fund Staff in their Report to the Board on Jamaica’s economic performance, acknowledged the GOJ’s “financial discipline” and “steadfast implementation of the initial reforms”. The Government of Jamaica remains fully committed to the specific targets set out in the April 2013 Memorandum of Economic and Financial Policies (MEFP). Unlike the aborted Stand-By Arrangement, this programme involves major front-loaded adjustments and reforms which are designed to restore growth and place debt on a firm downward path. Accordingly, and in line with normal practice, the GOJ on 13 September 2013 submitted to the Fund a second Letter of Intent and a Supplementary MEFP, in which we outlined an appreciably strengthened policy framework. These recent agreements reached with the Fund are outlined in documents which have been laid today on the Table of the House, in the form of a Ministry Paper No. 116/13 entitled FIRST QUARTERLY REVIEW OF THE EXTENDED FUND FACILITY WITH THE INTERNATIONAL MONETARY FUND. This is in keeping with our commitment to transparency with respect to the programme…READ MORE