POST CABINET REPORT For November 14, 2018

POST CABINET REPORT For November 14, 2018


Senator Ruel Reid- Information Minister

Advisory

Please see below activities of Cabinet since the last briefing.

Cabinet approved the following for tabling in Parliament:

  1. An Act to Amend the Protection of Plant Genetic Resources for Food and Agriculture Act 2018 
    1. This seeks to amend the original Act to provide for the integration of the functions of the Management Authority into the Ministry responsible for agriculture in keeping with the Government’s thrust to rationalise public bodies. The objectives and purpose of the Bill is to:
    2. Ensure the integration of activities under the Treaty on Plant Genetic Resources for Food and Agriculture into the Government’s relevant agricultural and development policies and programmes;
    3. Cooperate with relevant international organisations in establishing and or strengthening the capabilities of developing countries with respect to sustainable use of plant genetic resources and in promoting and exchanging of plant genetic materials
    4. Manage the Plant Resources Fund; and
    5. Establish and maintain a Register of Plant Genetic Resources.
  1. The Bank of Jamaica (Amendment) Act 2018:
    1. This bill seeks to modernise the Bank of Jamaica and strengthen its governance structure
    2. The amendments include provisions to allow for the adoption of full-fledged inflation targeting as a preferred framework for monetary policy-making with adequate governance arrangements to ensure accountability;
    3. Establish the independence of the Bank from undue external influence on its operational and policy decision making; and
    4. Establish a governance structure for the Bank with collective decision-making bodies and effective board oversight.
  1. The following Annual Reports
    1. Annual Report of the University Hospital of the West Indies 2014/15 & 2015/16
    2. Annual Report of the Sugar Industry Authority for Crop Year 2016/17
    3. Jamaica Business Development (JBDC) 2016/17
    4. Jamaica Urban Transit Company (JUTC)2016/17
    5. Anti-Doping and Subsidies Commission 2014/15
    6. Jamaica International Free Zones Development Ltd 2016/17

4: Award of Contracts

Cabinet gave approval for the award of the following contracts:

  • Replacement of the synthetic running track at Stadium East, National Stadium

This contract was awarded to BSW of Germany in the sum of seventy-one million five hundred thousand dollars ($71,500,000.00)

  • Marketing and Advertising Services for tourism

Beautiful Destinations has been approved for the award of a contract in the sum of three million eight hundred and fifty thousand US dollars (US$3,850,000.00) for a three year period: November 1, 2018 to October 2021, plus a monthly commission of 9.9% for media services paid monthly. This averages a sum of $15M per year for the three-year contract.

  • Four Pumper Trucks for the Jamaica Fire Brigade Services 

JR Wellington Import/Export Corporation has been approved for a contract in the sum of two hundred and seventy-six million, eight hundred and twenty-eight thousand, three hundred and sixty dollars

($276, 828,360.00) for the supply and delivery of four pumper trucks for the Jamaica Fire Brigade Services Multi-Parish Programme.

  • Civil Infrastructure Works, Friendship Housing Development Phase 1, St Elizabeth

HDB Construction Ltd has been approved for the award of a contract in the sum of one billion, three hundred and sixteen million, three hundred and twenty-three thousand, eight hundred and forty-eight dollars and seventy-seven cents ($1,316,323, 848.77) for the provision of civil infrastructure works for the Friendship Housing Development, an NHT project in St Elizabeth

  • Civil Engineer Lead Team of Consultants Friendship Housing Development Phase 2, St Elizabeth

Cabinet approved the award of contract in the sum of  seventy-five million four hundred and ninety-seven thousand,  nine hundred and fifty-one dollars and forty –two cents ($75,497,951.42) to JENTECH Consultants Ltd for the provision of a civil engineer lead team of consultant to design and monitor the construction of the Friendship Housing Development Phase 2 in St Elizabeth.

  • Integrated Infrastructure Project, Canaan Heights Clarendon

Cabinet approved the award of contract to ALCAR Construction and Haulage Ltd for the execution of rehabilitative works under the Canaan Heights Integrated Infrastructure Project through the JSIF in the amount of one hundred and sixty million four hundred and fifty-one thousand seven hundred dollars and twenty-five cents, ($160, 451,700.25)

  • Chemical Supply and Services for Refinery Process and Utilities at Petrojam Ltd

Cabinet has approved the award of a contract to Suez Water Technologies & Solutions for the provision of chemical supplies and services for the refinery process and utilities at Petrojam Ltd for a three-year period. The contract is in the sum of one million, seven hundred and eighty-six thousand, three hundred and twelve US dollars (US$1,786,312.00), inclusive of GCT.

  • Supply of Medical Gases to Cornwall Regional Health Authority

Industrial Gases Ltd has been approved for award of contract in the sum of one hundred and twenty-one million, one hundred and three thousand, seven hundred and ninety-two United States dollars and fifty–two cents  (US$121,103,792.52) this to supply medical gases to the Western Regional Health Authority for a one year period.

  • Supply of Viral Load Tests Reagents and Supplies to the National Public Health Laboratory
    1. LASCO Distributors Ltd has been approved for the award of a contract to supply viral load tests reagents and supplies to the National Public Health Laboratory for one year. The amount approved for this contract is eight hundred and seventy-five thousand, seven-hundred and seven US dollars and twenty cents (US $875,707.20).
  • Firefighters Protective Clothing (Bunker Gear) & Self Contained Breathing Devices

Bell Safety Ltd has been approved for award of contract in the sum of one million. two hundred and seventy thousand two hundred and four United States Dollars and 11 cents ( US$ 1,270,204.11), to supply fire-fighters protective clothing and self-contained breathing apparatus to the Jamaica Fire Brigade (JBF); this includes the following:

  • 350 fire-fighters protective clothing in the amount of US 833,037.33; and
  • 99 self-contained breathing apparatus in the amount of US$ 437,165.78 
  • Deep Energy Retrofits for Three Government Hospitals

Cabinet has agreed for the award of a contract to design, supply, install,  commission and maintain energy efficiency and renewable energy interventions that could guarantee reductions in electricity consumption at the Kingston Public/Victoria Jubilee, Mandeville and Falmouth hospitals. This is further to the conduct of an energy audit to allow for a comparative review of the submissions.

Consequently, Power Services Company Ltd was approved for a contract in the sum of five million, three hundred and fifty-eight thousand, three hundred and eighty-two US dollars and ninety cents, (US$5,358,382.90) to undertake this project.

 

Contact:

Senator Ruel Reid

ruel.reid@moey.gov.jm

or

Colin Steer  

colin.steer@moey.gov.jm

 

Hon Fayval Williams – Minister of State, Ministry of Finance and the Public Service

Update on Employment

Since our last Post Cabinet press briefing, STATIN reported strong news on the employment front. Approximately 1,338,200 persons are employed resulting in an employment rate of 91.6% or conversely, an unemployment rate of 8.4%. 

This is excellent news and for those persons seeking jobs, and with unemployment at a 50-year low, it should be a lot less stressful.

  • The construction industry saw 9,400 additional jobs.
  • Real estate renting and business activities saw an increase of 6,800 jobs
  • Health and social work improved by 5,200 additional jobs

On the other hand, Private Households with Employed Persons saw 5,200 persons shifted into other areas of employment. This is not surprising. As new job opportunities are presented, persons who are employed as household help will also want to avail themselves of such job opportunities. I believe that is what we are seeing in the numbers.

IMF 4th Review

On November 5, 2018, the Executive Board of the International Monetary Fund (IMF) completed the fourth review of Jamaica’s performance under the programme supported by the Stand-By Arrangement (SBA).

The summary was that implementation of the Government’s policy programme remains strong. All quantitative performance criteria (QPCs) at end-June were met.  The central government’s primary surplus exceeded the target by J$13 billion or 0.7 percent of GDP, due to buoyant tax revenues such as trade taxes, domestic SCT, and taxes on interest. Capital expenditure was about 13 per cent above budget in June – an unusual occurrence in Jamaica where capital expenditure has typically been under-executed. This higher infrastructure spending will help fill the wide infrastructure gap. 

Non-borrowed reserves at the BOJ exceeded the Government’s target by US$400 million, supported by robust tourism receipts.

The IMF noted as well that:

  • GDP growth has been supported by robust mining and construction.
  • The Government’s crime reduction efforts are paying off.
  • Living standards are improving due to strong employment.
  • Inflation has been persistently low.

Disaster Risk Financing

A new measure in the Government-agreed SBA programme with the IMF is to develop and submit to Parliament a National Natural Disaster Risk Financing Policy for Jamaica by end of June 2019.  I am pleased to report that the work has started in earnest.  A Cabinet submission was approved by Cabinet on November 5 for the establishment of a Policy Steering Committee to oversee the development of the policy.  A public forum on the fiscal risk of natural disasters was held on November 7, which was well attended. Jamaicans have a significant part to play in building resilience in our physical infrastructure (roads, drain network, telecommunication, utility network, and buildings), taking steps to mitigate natural disasters as well as putting in place a National Natural Disaster Risk Financing Policy for Jamaica so that in the aftermath of natural disasters, we can recover faster and build back better. We can only ensure all of this if we have a plan and we have contingency in our budgets, insurance to offload some of the risks and financial products such as lines of credit and catastrophe- financing in our portfolio of disaster risk financial products. Of note, the Prime Minister and Minister of Finance will present on the progress in establishing a comprehensive financing plan for natural disasters at an international conference to be convened at the IMF in Washington, USA, on Nov 26, 2018.

Additionally, I know the press and Jamaicans are aware that at a recent high-level meeting of 20 heads of government on September 27, 2018, for the 73rd Session of the United General Assembly (UNGA) in New York at the UN Headquarters, the Secretary-General of the United Nations, Mr. Antonio Guterres, invited Prime Minister, Andrew Holness and President of France, Emmanuel Macron, to lead a political initiative to mobilize US$100 billion climate financing to support the implementation of the Paris Agreement.

The reality is Jamaica has no choice but to be at the forefront to provide leadership on issues of climate change. Jamaica, by virtue of its geographic location in the Caribbean, is very exposed to natural disasters. Research findings from the International Monetary Fund (IMF) show that since 1950, more than 12,000 natural disasters have been registered globally. During that same period, the Caribbean has been hit by 324 natural disasters. The economic impact of these 324 natural disasters in the Caribbean has been substantial, exceeding US$22 billion in cost over the period 1950 to 2016, representing about 38 per cent of the global damage from natural disasters.

The worst climate change impacts include rising sea level, severe flooding, threatening of coastal environments and destruction of agriculture, putting small island states at severe risk of loss of life and infrastructure. Jamaica has no choice but to be at the forefront to provide leadership on issues of climate change.

 

Looking ahead:

  • The PIOJ is expected to hold its press conference Wednesday, November 21, 2018 to give an update on GDP for the September quarter.
  • STATIN will release inflation figures for the month of October on Thursday, November 22, 2018.

Hon Fayval Williams

Minister of State, Ministry of Finance and the Public Service

 

Update on Employment

Since our last Post Cabinet press briefing, STATIN reported strong news on the employment front. Approximately 1,338,200 persons are employed resulting in an employment rate of 91.6% or conversely, an unemployment rate of 8.4%.

This is excellent news and for those persons seeking jobs, and with unemployment at a 50-year low, it should be a lot less stressful.

  • The construction industry saw 9,400 additional jobs.
  • Real estate renting and business activities saw an increase of 6,800 jobs
  • Health and social work improved by 5,200 additional jobs

On the other hand, Private Households with Employed Persons saw 5,200 persons shifted into other areas of employment. This is not surprising. As new job opportunities are presented, persons who are employed as household help will also want to avail themselves of such job opportunities. I believe that is what we are seeing in the numbers.

IMF 4th Review

On November 5, 2018, the Executive Board of the International Monetary Fund (IMF) completed the fourth review of Jamaica’s performance under the programme supported by the Stand-By Arrangement (SBA). The summary was that implementation of the Government’s policy programme remains strong. All quantitative performance criteria (QPCs) at end-June were met.  The central government’s primary surplus exceeded the target by J$13 billion or 0.7 percent of GDP, due to buoyant tax revenues such as trade taxes, domestic SCT, and taxes on interest. Capital expenditure was about 13 per cent above budget in June – an unusual occurrence in Jamaica where capital expenditure has typically been under-executed. This higher infrastructure spending will help fill the wide infrastructure gap. Non-borrowed reserves at the BOJ exceeded the Government’s target by US$400 million, supported by robust tourism receipts.

The IMF noted as well that:

  • GDP growth has been supported by robust mining and construction.
  • The Government’s crime reduction efforts are paying off.
  • Living standards are improving due to strong employment.
  • Inflation has been persistently low.

Disaster Risk Financing

A new measure in the Government-agreed SBA programme with the IMF is to develop and submit to Parliament a National Natural Disaster Risk Financing Policy for Jamaica by end of June 2019.  I am pleased to report that the work has started in earnest.  A Cabinet submission was approved by Cabinet on November 5 for the establishment of a Policy Steering Committee to oversee the development of the policy.  A public forum on the fiscal risk of natural disasters was held on November 7, which was well attended. Jamaicans have a significant part to play in building resilience in our physical infrastructure (roads, drain network, telecommunication, utility network, and buildings), taking steps to mitigate natural disasters as well as putting in place a National Natural Disaster Risk Financing Policy for Jamaica so that in the aftermath of natural disasters, we can recover faster and build back better. We can only ensure all of this if we have a plan and we have contingency in our budgets, insurance to offload some of the risks and financial products such as lines of credit and catastrophe- financing in our portfolio of disaster risk financial products.  Of note, the Prime Minister and Minister of Finance will present on the progress in establishing a comprehensive financing plan for natural disasters at an international conference to be convened at the IMF in Washington, USA, on Nov 26, 2018.

Additionally, I know the press and Jamaicans are aware that at a recent high-level meeting of 20 heads of government on September 27, 2018, for the 73rd Session of the United General Assembly (UNGA) in New York at the UN Headquarters, the Secretary-General of the United Nations, Mr. Antonio Guterres, invited Prime Minister, Andrew Holness and President of France, Emmanuel Macron, to lead a political initiative to mobilize US$100 billion climate financing to support the implementation of the Paris Agreement.

The reality is Jamaica has no choice but to be at the forefront to provide leadership on issues of climate change. Jamaica, by virtue of its geographic location in the Caribbean, is very exposed to natural disasters. Research findings from the International Monetary Fund (IMF) show that since 1950, more than 12,000 natural disasters have been registered globally. During that same period, the Caribbean has been hit by 324 natural disasters. The economic impact of these 324 natural disasters in the Caribbean has been substantial, exceeding US$22 billion in cost over the period 1950 to 2016, representing about 38 per cent of the global damage from natural disasters.

The worst climate change impacts include rising sea level, severe flooding, threatening of coastal environments and destruction of agriculture, putting small island states at severe risk of loss of life and infrastructure.

Jamaica has no choice but to be at the forefront to provide leadership on issues of climate change.

Looking ahead:

  • The PIOJ is expected to hold its press conference Wednesday, November 21, 2018 to give an update on GDP for the September quarter.

 

STATIN will release inflation figures for the month of October on Thursday, November 22, 2018.