Press Release No. 13/374

Press Release: IMF Completes First Review under Extended Fund Facility Arrangement for Jamaica and Approves US$30.6 Million Disbursement

September 30, 2013

The Executive Board of the International Monetary Fund (IMF) today completed the first review of Jamaica’s performance under an economic program supported by a four-year, SDR 615.38 million (about US$944 million, the equivalent of 225 percent of Jamaica’s quota in the IMF) Extended Fund Facility (EFF) arrangement. The completion of this review enables the disbursement of SDR 19.97 million (about US$30.6 million), which would bring total disbursements under the arrangement to SDR 156.72 million (about US$240.4 million).

Following the Executive Board’s discussion, Mr. Nayouki Shinohara Deputy Managing Director and Acting Chair of the Board, stated:

“Overall program implementation under the Extended Fund Facility (EFF) has been strong, despite the weak economic environment. The authorities’ continued committment to the program objectives of strengthening Jamaica’s fiscal position and creating the conditions for sustained economic growth will be critical to a revival of investor confidence and domestic demand in the period ahead.

“The program for the remainder of fiscal year 2013/14 focuses on structural reforms to strengthen the fiscal framework. Priorities include the enactment of an effective fiscal rule to lock in the gains from the fiscal adjustment thus far, and a comprehensive tax reform to broaden the tax base and reduce distortions. An expected short delay in submission to parliament of a new law on tax incentives should not postpone its enactment.

“Achieving broad-based growth and enhancing social protection are central pillars of the authorities’ economic program. The growth agenda should be bolstered by further actions to enhance the business environment and support well-targeted public investments, in close collaboration with development partners.

“Close monitoring of the financial system remains essential to forestall the emergence of vulnerabilities following February’s restructuring of the public debt. A comprehensive reform of the securities dealers sector would also be important for safeguarding financial stability.”