The Jamaica Manufacturers' Association (JMA) wants the Government to implement policies to stimulate investment and create employment now that the country appears all set to pass the first test under the International Monetary Fund (IMF) Extended Fund Facility.
The association lauded the Government and the independent oversight committee co-chaired by president and chief executive officer of Sagicor Life Jamaica, Richard Byles, and Bank of Jamaica governor, Brian Wynter "for ensuring that Jamaica is on the right track".
The JMA said it was appeased that Jamaica's fiscal performance exceeded projections and urged the Government to continue on the path to ensuring that the pillars of the IMF agreement are met.
"However, while the Government has achieved this mark, the JMA is calling for the implementation of policies that will stimulate investment, create well-needed employment and put Jamaica on a path for growth, as this is the real measure of success," the association said in a media release.
Deputy President of the JMA, Metry Seaga, told Wednesday Business that there are five policies the organisation would like the Government to address, namely tax reform; getting the high-energy costs under control; crime and justice; red tape and the procurement policy. "We feel that the Government as the largest purchaser needs to start buying locally wherever possible," he said.
Among the main pillars of the IMF loan agreement are structural reforms to boost growth and employment.
adverse economic conditions
In the memorandum of economic and financial policies filed with the IMF in support of its arguments for a loan agreement, the Jamaican Government said that since the mid-1990s, real gross domestic product growth averaged less than one per cent a year, which has contributed to sustained high unemployment rates and large-scale emigration of labour.
"The Government is well aware that adverse economic conditions are generating drastic socio-economic changes in Jamaica. The contraction in activity has led to a significant increase in layoffs, exacerbating the already high unemployment rate," it said.
The Planning Institute of Jamaica reported last week that the unemployment rate for April 2013 was 16.3 per cent, the highest quarterly rate recorded since April 1997, making it a 16-year high.
As part of the growth agenda in the IMF agreement, the Government has committed to implement a strategy that integrates time-bound fiscal consolidation with structural reforms for reducing impediments to growth and facilitating strategic investments.
It said that other than the high public debt, key impediments to growth include low factor productivity and weak competitiveness; high energy costs; bureaucratic business processes; high crime, and inadequate legal enforcement.
The programme of structural reforms, which seeks to address those limiting factors, is wide-ranging, sequenced to promote institutional and capacity building over the programme period, and will be supported by a close collaboration between the IMF, the World Bank and the Inter-American Development Bank.