By Vernon Daley, Staff Reporter
Davies and Whiteman
LOSSES SUFFERED by the Central Bank increased significantly in 2002 when compared to the previous year.
It emerged in the Senate last Friday that the Bank of Jamaica losses moved from $1.30 billion for the 2001 calendar year to a projected $1.38 billion last year.
Senate majority leader, Burchell Whiteman, disclosed the figures in his responses to questions posed recently by Jamaica Labour Party (JLP) Senator Bruce Golding. In his responses, the Minister also noted that the Ministry of Finance had made no cash disbursements to assist the BoJ with losses for the last two years.
Mr. Whiteman disclosed that the net value of foreign currency sold to the market by the Central Bank in 2002 was US$187.9 million. This was a substantial jump from the US$92.1 million sold to the market for the previous year.
Since the start of the year, the Central Bank has intervened in the foreign exchange market on a regular basis to protect the local currency, which has been coming under increased pressure.
To help control the slide, the BoJ last Monday introduced a 150-day paper instrument at 30 per cent interest. Finance and Planning Minister, Dr. Omar Davies backed the move in an statement to the House of Representatives last week, noting that the measure would remain in place as long as necessary.
However, by the end of last week the BoJ had withdrawn the instrument. The Jamaican dollar was being sold for a as high as $54.30 when the instrument was introduced. However, at the end of trading on Friday, the BoJ's average selling rate was $51.97.
Meanwhile, Senator Whiteman disclosed on Friday that the country's foreign currency denominated debt, which falls due in 2003/2004, is US$628.34 million. This represents principal of about US$286.33 million and interest of some US$342.01 million. Of this amount, US$182.09 million represents bond issue.
Last week, Dr. Davies revealed that the government had launched a new Eurobond issue aimed at raising money in the international market to plug the hole in the current budget as well as pay down the debt on a 200 million Eurobond issue which becomes due on February 24.
