Progress here has been remarkable within several dimensions. Looking back, Jamaica was on the verge of an economic meltdown 4–5 years ago: net international reserves dropped to below USD1 billion; there was an overwhelming public debt burden nearing 150% of GDP, resulting in the government spending more than 8% of GDP on interest payments; and inflation and current account deficits were in double digits. These massive macroeconomic imbalances required both an internal and external adjustment. On the internal front, this is the fifth consecutive fiscal year that the government will achieve a primary surplus equal or in excess of 7% of GDP. As a result, public debt is projected to fall below 110% of GDP, an amazing reduction by international standards. There is also an ongoing effort to reshuffle expenditure toward growth-enhancing spending, including public investment and social spending, to support the most vulnerable in society. Our net international reserves have more than tripled, to more than USD3 billion today.
May. 16, 2018
Constant Lonkeng Ngouana
Resident Representative, Jamaica, IMF
Managing Director, Development Bank of Jamaica
Our main role is to facilitate economic growth and development that is inclusive. We promote the latter in a number of ways, such as by financing programs for the productive sectors. The major focus here is on micro, small, and medium–sized enterprises (MSME), as they are the true engines of most economies' growth. We provide concessionary financing for SMEs and capacity development through technical assistance to these enterprises and provide them with access to financing from with a number of loan products and financial institutions. From the perspective of our financing program, we are focused on ensuring that MSMEs are able to grow, develop, and be part of the growth trajectory for the economy. Jamaica needs economic growth and development, and we have been through a period of significant fiscal constraints under the IMF program that have been extremely successful. The economy has stabilized and the country has reduced the debt; now the focus must be on growth and job creation.
Country Manager, World Bank
We have a long and strong partnership with Jamaica. Our current country partnership strategy was developed in 2013 together with the IMF and IDB and prepared a comprehensive package of support for Jamaica's stabilization and growth program. The strategy focuses on three main areas: building the foundations for competitiveness and growth; public-sector transformation; and addressing vulnerability and building resilience, which is related to both natural disasters and social vulnerability. We have provided over USD510 million over the years, with more than half in budget support, and the rest in project financing and a strong program of advisory services and technical assistance. We did a performance and learning review in 2016 that assessed the implementation and validity of the strategy. The conclusion was that those three areas continue to be critical for Jamaica's development. The second part of the assessment was on how well we have done in contributing to the reform agenda and development of Jamaica—a great deal.
General Manager, Country Department Caribbean Group, Inter-American Development Bank
The Jamaican economy has not grown substantially for 30 years. It is heavily indebted because of a combination of domestic and external burdens. Jamaica's financial crisis in 1997 had a massive impact on the financial landscape and economy at large, costing it 45% of GDP. There are a lot of residual effects associated with that crisis, mostly on the level of public debt. In recent years, notably since 2013, the debt has been on a declining trajectory, and the macroeconomic management of the country is much improved. This, however, does not mean that Jamaica is out of the woods, as debt to GDP is still over 100%. Nevertheless, the country is on the right track. Where there is room to improve quickly is on the growth side. Jamaica's private sector is dominated by a few family-owned companies, of which some are listed on the stock exchange. Our research shows that while some small pockets of innovation exist, there needs to be more.