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JAMAICA - Finance Minister wants support for economic reforms

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Finance and Planning Minister, Dr. Peter Phillips, is again urging national support for Jamaica’s Economic Reform Programme (ERP), which aims to reduce the country’s debt, and set a platform for growth.

Speaking at the Manchester Chamber of Commerce’s Biz Clinic 2013 Forum at the Mandeville Hotel, on July 25, Dr. Phillips, while acknowledging that the programme’s implementation was a pre-requisite for concluding the new US$932.3 million four-year International Monetary Fund (IMF) Extended Fund Facility (EFF), emphasized that it is also a “requirement for us to put our economy on a firm footing to achieve sustained levels of growth.”

The programme, components of which have either been implemented or are currently being embarked on, aims to reduce Jamaica’s debt from the current 145 per cent of gross domestic product (GDP), to 96 per cent by 2020. 

These components include: attainment of a 7.5 per cent primary budgetary surplus target; implementation of a National Debt Exchange (NDX) programme; tax reform; and  public sector reform, restructuring of salaries to reduce ratio to GDP from 10.6 per cent, as at March 31, 2013, to nine per cent by 2015/16. 

Noting that there is “a tendency on the part of commentators” to associate the programme solely with the EFF, the Minister stressed that whether or not there was an agreement, “we need these economic reforms, primarily, because we have an unsustainable level of public debt.”

“It is true that the pain generally comes before the gain, and we are in a period now where the stresses are being felt. But, it is also the case that we can see the prospects of the growth, which is the focus of the entire programme,” he said.

Dr. Phillips pointed out that inflation outturn for the April to June quarter was 1.2 per cent, which fell below the two to three per cent forecast.  Additionally, he said the Net International Reserves  (NIR) stood at just over US$1 billion, representing approximately 13 weeks of goods and services imports. 

This figure, he indicated, was US$119 million  higher than the outturn at the end of  the January to March quarter. 

“The turnaround will not come instantaneously. But, I think it is important to recognize that there are important opportunities for us to even exceed what, admittedly, are moderate growth targets for the first phase of our programme,” the Minister said.

“We can…complain about all the things that could be different, or we can become part of the change. I want to urge all of you to inform yourselves and be evangelists for economic reform in the country,” Dr. Phillips added.