Byles: Ja­maica will need con­tin­ued IMF sup­port

Jamaica Gleaner - - INTERNATIONAL NEWS -

CO-CHAIR­MAN OF the Eco­nomic Pro­gramme Over­sight Com­mit­tee (EPOC), Richard Byles, says Ja­maica will, for a very long time, need the sup­port of the In­ter­na­tional Mon­e­tary Fund (IMF) if the coun­try is to achieve debt and fi­nan­cial sus­tain­abil­ity.

Byles, in mak­ing his pre­sen­ta­tion at a re­cent sym­po­sium hosted by the Depart­ment of Eco­nom­ics at the Univer­sity of the West, Mona Cam­pus, said he was pleased that the Gov­ern­ment has sig­nalled its in­tent to re­main with the IMF by way of a new staff-level agree­ment which it an­nounced re­cently.

He said that his pref­er­ence of Ja­maica re­main­ing with the IMF is not be­cause he felt that the coun­try’s fi­nan­cial tech­ni­cians are in­com­pe­tent, but be­cause “they need the [sup­port] of the In­ter­na­tional Mon­e­tary Fund to make sure that we do what we know we are sup­posed to do”.

In fur­ther de­fend­ing his stance, Byles said politi­cians from both ma­jor po­lit­i­cal par­ties were sus­cep­ti­ble to po­lit­i­cal pres­sure and could back down from mak­ing the tough de­ci­sions needed to ad­vance the cause of the coun­try.

“Of­ten times when you look back in our his­tory of de­ci­sion mak­ing, we have taken the wrong road. Had we taken the right road back then, life would be eas­ier. So we need to have an in­sti­tu­tion like the IMF that can — whether it is for them to be blamed, or for them to de­ter­mine what we have to do — [help Ja­maica] to do the right thing,” Byles said.

OB­JEC­TIVE VIEW

The Sagi­cor boss told his au­di­ence of univer­sity stu­dents, lec­tur­ers and fi­nan­cial prac­ti­tion­ers that IMF would negate the pres­sures that are brought on by pol­i­cy­mak­ers to de­fend spe­cial in­ter­ests, as the in­sti­tu­tion brings an ob­jec­tive view.

“The spe­cial in­ter­ests in the past, have pre­vailed and pre­vented us from do­ing the right thing, for ex­am­ple in tax­a­tion. The tax sys­tem we have has dis­tor­tions that are born of spe­cial in­ter­est and it takes an in­ter­na­tional in­sti­tu­tion to say, ‘you [have] to fix this or that’,” Byles ar­gued.

He em­pha­sised the point that though Ja­maica has made sig­nif­i­cant strides in bring­ing down its debt-to-GDP ra­tio to 120 per cent, the coun­try is still at the edge of a fi­nan­cial precipice.

“The econ­omy is still so frag­ile, still so small and open, a sin­gle weather event can throw us off track.

“A sin­gle world fi­nan­cial event will throw us off track. Ris­ing oil prices will throw us off track.”

De­clared Byles: “We need a very strict pro­gramme!”

In the mean­time, Byles is of the view that pay­ing down the debt should not be an ex­cuse for not find­ing a cre­ative project to drive eco­nomic growth.

“We can­not see debt as some­thing that we can put aside and con­tinue to build our wealth,” he said.

The EPOC co-chair­man ar­gued that re­duc­ing the coun­try’s debt and using ini­tia­tives to grow the econ­omy are par­al­lel ac­tiv­i­ties which are crit­i­cal to achiev­ing fi­nan­cial pros­per­ity for the coun­try. “I be­lieve that this is what the cur­rent ad­min­is­tra­tion is ar­tic­u­lat­ing that it wants to do—put a lit­tle more em­pha­sis on the growth side, but they are pay­ing down the debt and we have no al­ter­na­tive to that,” Byles said.

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Richard Byles

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