Stay the course, IMF again advises government
McPherse Thompson, Assistant Editor - Business
WASHINGTON, DC: The International Monetary Fund (IMF) is adamant that Jamaica continue on the current economic reform trajectory despite sections of the population's impatience with observing tangible benefits becoming manifest in the form of jobs and other economic benefits.
"Our advice has been to stay the course," IMF mission chief to Jamaica, Dr Jan Kees Martijn reiterated in the wake of public opinion polls that the economic programme being pursued by the Simpson Miller administration has failed to win appeal among a majority of Jamaicans.
In an interview on the margins of the IMF and World Bank annual meetings in Washington last Thursday, Martijn declined to comment directly on the waning support of the administration and what that meant to the continuation of the programme.
"Our focus is really on helping the Government through this programme to be as effective as it can be and helping them to implement it financially and with technical assistance," Martijn said.
His advice to stay the course - a phrase used by IMF Managing Director Christine Lagarde in the context of the agreement when she visited Jamaica in June this year - was made in response to the question as to what advice he would give to the government at this juncture of the programme.
"We think this programme provides the basis for sustainable growth. We realised that it was not going to be quick or easy. It isn't," Martijn said. "There's a lot that remains to be done. There are many areas that we haven't touched on yet. And so it does take time to see the fruit of this reform process. We are here for the entire duration of the programme. We are here as long as the Government is committed and wants us to be involved."
As to his assessment of the ability of the Government to achieve the targets going forward, the IMF mission chief said: "I can see that from the past five reviews; they have demonstrated a very strong commitment and the ability to deliver. We will certainly do what we can to continue that and I hear from the authorities that they will, too. So we very much look forward to 10 more reviews, and most importantly we look forward to seeing the results of that on the ground and also a further pick-up in growth, a reduction in debt, reduction in unemployment, the reserves increasing further and retaining that sustainable growth path."
Reflecting on Jamaica's economic environment before the IMF inked the four-year Extended Fund Facility in May 2013, Martijn said it is difficult to think about what would have happened if the programme had not existed.
He noted that a year and a half ago, reserves were depleting fast and Jamaica was running out of financing.
"I don't think there was a simple alternative that would have magically resulted in fast growth, more room for the Government or a stable exchange rate, because without reserves, the exchange rate is going to move." said the mission chief.
"So sometimes, thinking about that scenario that did not materialise may help put in perspective where we are today."
He said that while the Government has made a very good start to the programme, with results on several fronts, a lot remains to be done.
Martijn said the hardest parts of the programme involved getting from the fiscal position Jamaica faced before the IMF agreement, and making adjustments such as tax and other reforms, to support the fiscal adjustment.