Tue | Jun 6, 2023

Audley the Man ... Shaw will be Finance Minister in next JLP administration

Published:Wednesday | January 20, 2016 | 12:00 AMDaraine Luton
Audley Shaw, opposition spokesman on finance (right), speaks at the Gleaner-Mona School of Business and Management roundtable leadership forum at the Spanish Court Hotel in New Kingston. Opposition Leader Andrew Holness is with him.
Andrew Holness (right), leader of the opposition, Professor Densil Williams (centre), executive director of Mona School of Business and Management and Dr Horace Chang, opposition spokesman on water and housing, at the forum yesterday.
Andrew Holness, leader of the opposition.

Jamaica Labour Party (JLP) Leader Andrew Holness yesterday insisted that Audley Shaw would be the finance minister if the party is elected to form the Government in the upcoming general election.

Holness, the leader of the opposition, gave a robust defence of the North East Manchester member of parliament's stewardship as finance minister from 2007 to 2011 when the JLP held state power.

"Under a Jamaica Labour Party government, which I lead, Mr Shaw will be our minister of finance," Holness said.

Shaw, who unsuccessfully challenged Andrew Holness for the leadership of the party in 2013, was given the assurance by the party leader that he would be in charge of the Treasury, while speaking at a joint Gleaner-Mona School of Business and Management Leadership Roundtable Forum at the Spanish Court Hotel yesterday.

Shaw presided over a collapsed economic programme backed by the International Monetary Fund (IMF) in 2011 and has targeted sharp criticisms at the multilateral for what he deemed to be preferential treatment being given to the current Government.

Yesterday, Holness said that while the JLP had "an excellent relationship with the IMF", as a government, its foremost obligation was to the people of Jamaica.

"That is the ultimate display of sovereignty," Holness said.

He said, however, that the JLP should be credited for significant efforts to reduce the debt, lowering interest rates, and bringing fiscal stability to the market. Those feathers, he said, belonged in Shaw's cap and not that of Dr Peter Phillips, the current finance minister.

Phillips was on Tuesday conferred with the Gleaner Honour Award for Public Service for "his role in managing the country's challenging financial portfolio through the current IMF-impacted programme and the creation of the Economic Programme Oversight Committee to monitor the country's performance during this period".

Holness said yesterday that "good fiscal management did not start with Peter Phillips".

"We put that in place," he added.

Holness said that prior to the arrival of Shaw in the finance ministry, "the orthodox thinking was high interest rate", saying that the acceptable economic thinking was no other way.

"Someone, the people who shape public opinion, forgot that the massive debt which now exists didn't just emerge under the Jamaica Labour Party; that the appetite that now exists started under the PNP (People's National Party) Government; and that there was actually something called FINSAC, which moved the debt in recent times past the 100 per cent mark.

"Were it not for the bravery of the Jamaica Labour Party Government - Bruce Golding and Audley Shaw - deciding to do a debt exchange, there would have been no real fundamental change in the debt," Holness said.

He said, too, that the divestment of the sugar assets and Air Jamaica contributed greatly to debt reduction.

Jamaica's current debt, as a percentage of GDP, is estimated to be 126.3.

Debt to GDP stood at 115.2 per cent in 2007-2008 when the JLP took state power and moved to 126.7 per cent in 2008-2009.

The debt further increased to 142.5 per cent in 2010-2011 and then decreased slightly to 140.1 per cent in 2011-2012. During the period that Shaw was finance minister, the debt grew by $713.35 billion or 68 per cent.

The economy contracted in the three years from 2008 to 2010 by more than five per cent, with growth in GDP recorded at negative 0.8 per cent in 2008, negative 3.1 per cent in 2009 and negative 1.4 per cent in 2010. However, in the JLP's last year, the economy grew by 1.7 per cent.

"What is undeniable is that the growth that we were able to achieve under Audley Shaw, as small as it was, in the midst of a depression, with oil prices passing US$100 [per barrel], this minister of finance, with oil prices at US$20, and no global recession, in fact recovery, has not managed to attain it," Holness said.

The economy grew by 1.5 per cent in the last quarter. From 2011 to 2014, the economy grew at an average 0.4 per cent.

The JLP, in its last stint at the crease, came during what has been described as the worst global economic recession in 80 years, left US$2 billion in the net international reserves and US$2.8 billion in gross reserves. Mortgage rates also fell from 18 per cent to 9.5 per cent and the exchange rate stood at 86:1.