IMF Review Press Conference
Prime Minister Andrew Holness
IMF Second Review Press Conference
September 14, 2017
We’re pleased that the second review was concluded successfully and we express thanks to Dr Ramakrishnan and her team for their tremendous work in preparing for the review and diligently conducting the review. The IMF Review Team holds extensive consultations with ministries, departments and agencies and engages in detailed data analysis and bench marking. We’re grateful to them and to their colleagues in Washington for the work that they have done and their continued support.
On behalf of the Government of Jamaica I express appreciation to the team at the Ministry of Finance led by Minister Shaw and to the Bank of Jamaica led by of course the Governor of the Bank of Jamaica Brian Wynter.
It’s a little bit tricky for me to thank myself but the team at the Office of the Prime Minister also played a part and I want to thank the team; that team led by Ambassador Clarke.
I want to talk a little bit about ownership. Passing of these reviews cannot be taken for granted. Under the precautionary Standby arrangement reviews are conducted every six months rather than every three months under the previous EFF. In some ways this represents a graduation for Jamaica but I’m reluctantly saying this because it doesn’t mean that it is any easier. In fact it is much more difficult than before.
The lower frequency of reviews means greater responsibility for Jamaica. It means that the government of Jamaica has to take ownership for the successful performance to targets so that we have passed them is a sign that the government is slowly but surely taking greater ownership of the policy goals and objective and with the passage of time the government of Jamaica will eventually without the help of the IMF have to take ownership and responsibility for the good institutional management of its affairs.
Ownership means implementing policies because those policies are right and not because we have a review to pass or because we’re in need of a draw down or because we are in need of an expression of international support. Ownership means making the difficult choices by ourselves, without external cajoling or covers. If we as a country aspire for greatness then we must do the great things, we must do the right things because they are right.
As the IMF chief has mentioned though this review, the second of six semi-annual reviews has been successfully completed; Jamaica is not yet out of the woods. The inheritance of our generation is a Jamaica with an outstanding reputation in the world with vigorous and robust democratic tradition and with a champion national spirit and for this we’re all grateful as Jamaicans, however another aspect of our inheritance is a Jamaica that has not yet achieved economic independence.
A Jamaica dependent on outside assistance as we’re currently structured, debt service obligations and public sector emoluments approximate 90% of tax revenues leaving precious little for spending on hospitals, schools, parks, roads, courthouses and national security. Though this state of affairs defines our inheritance, it falls to us to ensure that we bequeathed a future to generations to come that can stand on their own in a world that is growing and that we are also growing. This is voyage on which we’re now embarked.
Such an economic transformation will require the active participation of all stakeholders and the government I lead is therefore built on partnership. They have invited the unions, civil society and the private sector to participate in this process through various public/ private bodies such as the Partnership for Prosperous Jamaica, The Economic Growth Council, EPOC (Economic Programme Oversight Committee) and PSTOC (Public Sector Transformation Oversight Committee).
The words spoken by Dr Ramakrishnan on the need to accelerate the reforms required for fiscal sustainability and independence are not new. Indeed some of these reforms should have been done years ago as such we no longer have the luxury of delay. Over the medium term Jamaica will need to invest more in security, growth inducing activities and in poverty alleviation. The fiscal room that will make this possible will come from a re-balancing away from a budget consumed by interest and emoluments.
The good news is that job growth is proceeding at a pace higher than we have experienced in a very long time. In fact there are more Jamaicans employed today than ever before in the course of our entire history. Much of that job growth is occurring in small and medium sized businesses which are the bedrock of our economy.
Reform of our public sector will be geared towards making it easier for our small and medium sized businesses to start grow and flourish. Reform of our public sector will make it easier for our SME’s to procure licenses and permits and to comply with regulations and most importantly to pay your taxes.
Reform of our public sector will provide rewarding career options for Jamaica’s brightest minds. While big businesses may be able to absorb or even pass on the cost imposed by length and efficient processes, these retard our small/ medium sized enterprises greatly which in turn effect a lower level of growth and employment.
Emerging from the spiral will require us to confront what we have avoided for so long – comprehensive reform of our public sector. In concluding with the support of the IMF and other multilateral partners, Jamaica has demonstrated incredible and unbroken resolve in its economic reform agenda. We have many successes of which we can be proud of however much remains to be done. Now is the time to recommit ourselves to the task at hand; the task of ensuring that we secure for future generations a Jamaica that is economically independent and can one day be net contributor to the international community.