JAMAICA | PNP Calls on Government to be Creative In the fight against Inflation

KINGSTON, Jamaica. January 5, 2024: Opposition Spokesperson on Industry, Investment & Global Logistics, Anthony Hylton, MP is calling on the Government to be proactive in the fight against inflation, projected to remain elevated due to a range of factors affecting international trade and global logistics. 

Mr. Hylton in pointing to geopolitical tensions in the Middle East, low vessel capacity at the Panama Canal, forecast for a very active hurricane season and the effects of recent drought in domestic agriculture, is concerned that the fight to keep inflation within the range set by the Bank of Jamaica (BOJ) will be lost using only monetary policy tools.

The Opposition Spokesperson said, “The government has, from the outset, adopted a very restrictive approach in dealing with the COVID-induced price rises with mainly exchange rate and interest rate tools, which it has maintained without a complementary strategy to protect vulnerable consumers and the MSME sector.” 

Mr. Hylton explained that “there has been no announced measures, excluding monetary tools, which have been proposed by the administration. The bus fare reduction is likely to have limited effect on inflation, and is not a substitute for a holistic approach to fighting what has been a supply-driven increase in prices.” He added that further disruption in supply chains is set to continue affecting the markets.

Given the negative fallout on consumer mortgages, construction, business expansion and investments in the small business sector and on the vulnerable population, any further increase in the policy rate by the BOJ in response to the headwinds on the horizon would be punitive, cautioned Hylton. 

Speaking to some possible solutions, Mr. Hylton said, “The Consumer Affairs Commission and the Fair Trading Commission should be more active and visible at this time to ensure that price increases are minimized and businesses are more efficient in their operations, so that consumers, particularly pensioners, the unemployed, and small businesses are not further burdened. 

The Opposition Spokesperson said, "the government has the fiscal space to act creatively and decisively in inducing the adoption of technology and innovation in addressing longstanding constraints to our economy of energy, customs reform, supply chain & logistics, among others".

Mr. Hylton warned that “in this matter, delay is danger!.”

-30-