IMF Test Number 7 Out of the Way
Jamaica is in line to draw down SDR28.32 million (special drawing rights) or US$40 million following the just-concluded seventh quarterly review of the country's performance under the extended fund facility (EFF).
The news comes as an International Monetary Fund (IMF) team reviewing Jamaica's performance concluded its work, which lasted from February 16-25.
Finance and Planning Minister Dr Peter Phillips made the announcement during a media briefing at his Heroes Circle offices in Kingston yesterday.
Phillips said that on the basis of the review, he expected that a letter of intent and a modified memorandum of economic and financial policies will be settled for the IMF board to consider in March.
Approval will trigger Jamaica's SDR entitlement. The finance minister is reporting that the IMF team took the opportunity to review the just-tabled $641.6-billion Budget.
He said both the Government and IMF team agreed that the Budget, as presented, was in line with the overall objectives of the programme under the EFF.
Phillips said the recent reversal in Jamaica's economic performance were cause for concern but that there are positive indicators coming out of recent statistics.
"This concern as to how we secure and sustain the anticipated growth benefits of the reform programme generally continues to be a major [watchword] of the Government of Jamaica. We believe that the growth momentum has been revived in the current quarter, and going forward, we look to that momentum being strengthened," Phillips said.
Jamaica received a ringing endorsement from the IMF team.
PROGRAMME ON TRACK
Mission Chief Dr Jan Kees Martjin said the programme under the four-year EFF has seen Jamaica meeting all targets, although revenue inflows were below par.
"The programme is on track and policy implementation remains strong. All quantitative performance targets through to the end of December were met, although the indicative target on tax revenues was narrowly missed," Martjin said, as he reported on the IMF Staff Review.
He said the IMF team reached a preliminary understanding on the way forward in terms of policy changes that would be necessary to chart a growth path for Jamaica as it gets the full benefit from the economic-reform programme.
"The Fund mission reached preliminary understandings with the authorities on economic policies. [It is understood] that they'll accelerate the pace of reforms so as to further unlock growth and bolster stability," the IMF mission chief said.
The IMF review comes at a time when macroeconomic numbers are improving. Inflation is running below the projected 7-9 per cent, about 6.4 per cent for the end of December (STATIN further reported 5.3 per cent point-to-point as at January 31). The finance minister said he expected inflation to fall to about five per cent by the end of the fiscal year on March 31. Unemployment for October 2014 was down 0.7 per cent to 14.2 per cent, with 14,000 more persons in the employed labour force.