Tue | Aug 4, 2015

IMF deal equals more frustration?

Published:Saturday | January 19, 2013

THE EDITOR, Sir:

Jamaica has been locked in a single-minded, laser-focused process of negotiating 'the agreement' to open all avenues and unleashed Jamaica's development for over two years.

The Jamaica Labour Party and the People's National Party have had an equal go at it. The private sector - 'the engine of growth' - economic analysts and the intellectual leadership of the society have all held their collective breaths. Urging haste in bringing home the Holy Grail.

Following a three-day retreat by Cabinet, Prime Minister Portia Simpson Miller on Tuesday, January 15, 2013, stated emphatically that the IMF is not the solution to Jamaica's development challenge but that we have to put our shoulders to the wheel.

Chris Zacca, head of the Private Sector Organisation of Jamaica, has agreed that the prime minister has got it right. This statement came after three weeks of the most forceful campaign and mobilisation during which Mr Zacca implored Peter Phillips, minister of finance and leader of the negotiations with the IMF, to conclude the agreement or tell the nation the sticking points so that Jamaica, presumably, could go about applying its own fix.

NO ASSURANCE

Minister Phillips is sending his team back to Washington. Have any lessons been learnt? What are the new instructions to the team? Public-sector workers have said that they will not accept a two-year wage freeze without, I presume, assurances that there will be wage increases at the end of the period. But, in this global environment and with Jamaica's endemic low investment, reinvestment and productivity, who will give such assurances?

Audley Shaw, who failed in well over one year to move the IMF to any form of understanding, has pronounced that the tax component of the package will fail. There are many areas, other than economic growth, where prophecies are easily made self-fulfilling.

Drastic reduction in expenditure on the public sector, significant increase in fiscal revenues and steep reductions in the ratio of our debt (consumption) to our total production (GDP) are parameters for the IMF.

Have we just set the Jamaican people up for more frustration?

I would respectfully urge readers to revisit my articles in the Gleaner editions of August 21, 2011 and January 15, 2012, respectively ('IMF stalemate' and 'Taming Jamaica's debt').

BYRON BLAKE

Former CARICOM Assistant Secretary General