Obama attracted to Jamaica's credibility
Jamaica's restoration of credibility in the international marketplace has been cited as the reason United States President Barack Obama is to visit the country next month.
Closing the 2015-2016 Budget Debate in the House of Representatives yesterday, Finance Minister Dr Peter Phillips said the country's performance under the programme has led to a reestablishment of credibility in the international market place.
"That is why we can raise finances in the international capital markets at the lowest rates ever; that is why the managing director of the International Monetary Fund feels able to visit; that is why the president of the IDB visited Jamaica, and that is why we are on the itinerary of President Barack Obama," Phillips said.
Prime Minister Portia Simpson Miller announced recently that Obama will pay a state visit to Jamaica on April 9 and will hold bilateral discussions on a range of issues of mutual interest.
During the visit, Jamaica will host a meeting between Obama and the heads of government of the Caribbean Community (CARICOM) for discussions on issues on the CARICOM-USA agenda, including security and trade.
It is the second time that a sitting United States president is visiting Jamaica, a country which Colin Bullock, director general of the Planning Institute of Jamaica (PIOJ), once said was seen as a pariah by the country's international development partners.
Christine Lagarde, managing director of the International Monetary Fund (IMF), visited Jamaica last June, and IDB President Luis Alberto Moreno, last December, both to demonstrate their support of Jamaica's efforts under the economic reform programme.
Yesterday, Phillips said Jamaica's reputation was badly damaged by the previous administration. He said this caused onerous burdens to be borne by Jamaicans under the current four-year extended fund facility agreed with the IMF in 2013.
He noted that under the standby agreement, during the tenure of the previous Government, there were three programme reviews completed by the IMF Board in August 2010, December 2010 and February 2011. By April 2011, the programme had already begun to go off track.
"... No effective or meaningful discussion regarding the programme took place between the IMF and the then Government after that visit of mid-2011," Phillips said.
He said that in January 2012, when the new Government took power, it found that the primary surplus for fiscal year 2011-2012 was approximately three per cent of GDP as compared with the target that had been lowered by the IMF to 6.8 per cent.
"In effect, Jamaica, under the previous administration, simply took the money and ran," Phillips said.
The minister said that an assessment in early January 2012 showed that all borrowing had dried up and no drawdown was available from the IMF or the World Bank. He also said that the European Union suspended grant funding and, despite a loan with the IDB having been signed in late 2011, no funds were transmitted.