The comment follows the IMF's completion of the fourth review of Jamaica’s performance under the 36 month Stand-By Arrangement (SBA)which was approved by the IMF’s Executive Board on November 11, 2016 .
Under the programme, the government has access to a total of SDR 1,195.3 million (about US$ 1.646 billion), equivalent to 312 percent of Jamaica’s quota in the IMF and which the administration continues to see as a precautionary, measure against unforeseen economic shocks that could lead to a balance of payments need.
Deputy Managing Director and Acting Chair of the Board of the IMF, Mr. Tao Zhang in a statement following the Board meeting, said “The authorities continue their impressive track record under the Stand-By Arrangement.
"While macroeconomic stability is entrenched, with reduced public debt and improving social and unemployment indicators, growth remains subdued. Against this backdrop, supply-side reforms to facilitate private sector investment are needed to achieve higher, sustained growth and job creation.
“The Bank of Jamaica (BOJ) remains committed to maintaining inflation within the 4-6 percent target range over the medium term. The recent tabling in Parliament of legislation to upgrade the BOJ Act is an important step toward the eventual shift toward full-fledged inflation targeting. is necessary to support an inflation targeting framework. The authorities are also planning to accelerate FX market development and the building of technical capacity in monetary operations.
The IMF's Deputy Managing Director said “The public-sector wage bill needs to be placed on a sustained downward path. Reduced wage outlays will allow the government to reprioritize public spending toward security, social assistance, and growth-enhancing capital expenditure. Achieving such a wage bill reduction will require a broad overhaul of the public compensation and allowance system and a reduction in the size of the government workforce.
He said “The financial sector should be further strengthened in line with the recommendations from the accompanying Financial Sector Stability Assessment.
The IMF said "Priority should be placed on enhancing coordination, data collection, monitoring, and strengthening technical capacity of the financial regulators. Improving consolidated and risk-based supervision are important reform areas. Addressing impediments that constrain access to finance would help support private-sector investment."
- Countries: Jamaica