Tue | May 30, 2017

IMF supports Jamaica taking excess US$500m in loans

Published:Wednesday | August 5, 2015 | 8:12 AM

The International Monetary Fund (IMF) says it supports Jamaica’s decision to borrow more funds than it needed recently from the international capital markets.

Last month, Jamaica raised about US$2 billion from two bonds it issued, which was $500 million more than it aimed for.

Most of the funds have been used to re-purchase the debt owed to Venezuela under PetroCaribe oil agreement.

Speaking on RJR’s Beyond the Headlines yesterday, the IMF’s Resident Representative here, Dr Bert van Selm, said the government made a good decision to take the extra funds.

He argued, among other things, that the excess money could be used to pay off other debts which become due this year.

 

IMF Resident Representative in Jamaica, Dr Bert van Selm

He also said the move sends a signal to creditors that the government is serious about repaying debts which could in turn boost confidence.

The Opposition has criticised the decision saying the excess money represents an additional burden on tax payers to service a larger debt.

Speaking on the same programme yesterday, the Opposition's Deputy Spokesperson on Finance, Fayval Williams, argued that the IMF was supporting the excess take up of funds despite the repayment cost.

 

Opposition Deputy Spokesperson on Finance, Fayval Williams

Williams said it will cost taxpayers about $12 billion to service the new debts.

Co-Chairman of the Economic Programme Oversight Committee, Richard Byles has suggested that the excess money be used to fund a job creation initiative.

However, the Private Sector Organisation says it is not in support of such a proposal.