FINANCE MINISTER, Dr. Omar Davies, apologised unreservedly for the manner in which he spoke and the interpretation arising from the comments he made about the economy at the recent PNP Constituency Conference for North West St. Andrew.Dr. Davies said it was clear that his comment has caused concern among many well-thinking citizens, given the position that he holds as Minister of Finance.
In a statement issued yesterday, Dr. Davies refuted suggestions that, by his comments, he had disregarded the national interest, ignored budget prudence and hidden the facts from the country to ensure a PNP victory.
Dr. Davies said for the record, he would like to make it clear that as Minister of Finance he had and would always operate in a manner that places the interests of Jamaica first. This is why he said during the election campaign he had repeatedly stated that whichever party wins the elections there would be tough fiscal decisions to be made going forward.
On reflection, he said, the tone and manner in which he addressed the constituency conference was regrettable. He noted, however, that while the voice clip of his presentation had gained much exposure, the context of the statement was important because without the context the references to flood damage and projects would not seem to have a logical connection.
He said the comments were made in response to a three-part question by a participant.
* On how the fiscal accounts had deteriorated so much in a year;
* Whether anything could have been done before;
* And government's expenditure for the immediate future?
In his response Dr. Davies said he indicated that the past 12 months had been extremely unusual, involving massive damage caused by four major floods.
In terms of financing the reconstruction process, the options theoretically were to reallocate resources from on-going projects and concentrate on flood damage or to continue with the existing projects whilst attending to the flood damage.
As any Government would have done in the prevailing circumstances, the Government pursued the latter course.
Given that the additional expenditure had not been budgeted for, he said it had not contributed to the widening of the deficit, which had to be corrected because it was not sustainable.
In this regard Dr. Davies said it is important to note that none of the projects being pursued by the Government were new, and therefore created as part of any "election budget" as some have suggested.
In addition, he pointed out that stopping and trying to restart major projects financed partly from external sources could not be unilaterally done by the Government and would certainly raise serious questions of fiscal responsibility.
Noting arguments that the excerpts of his speech carried in the media gave the impression that the PNP Government had chosen to neglect the flood damage in order to concentrate on "election" projects, Dr. Davies said there had been no such neglect, as this would make no sense for a number of reasons. Chief among the reasons, he said, was the fact that if the administration simply continued implementing on-going projects, there would have been no additional fiscal impact.
"In the final analysis what confronts the Jamaican economy is not only the devastating financial and structural costs of the floods, compounded by the substantial fallout resulting from 9/11, but a very unstable world economic climate heavily weighed by increasing oil prices, and the imminent threat of war. That is the reality the country faces."
