Mi tell unnu long time that the

[Don1]

No worries...mi nuh fraid ah book

Is yuh Loose Association of Friendly People mi ah penni... dem nuh know book...but dem know Chain Saw, Croc an Carbine... dont?

Wi tek yuh pickcha langlang time yute

Poseur or Co-conspirator...dat is di $64K question..... hmmmmm

[ReggaeMike]

Mi know unnu nuh like facts, unnu like propoganda but

http://jamaica-gleaner.com/gleaner/2...us/focus3.html

Well I've read it and I noticed this bit:

In the 2009-2010 Budget, the Government introduced a cess on fuel of $8.75 per litre, which, it said, would be put into the RMF for infrastructural work on roads. The Government then switched into a $340-million loan arrangement with the China EXIM Bank, and told the country that instead of using the allocation from the cess directly to rehabilitate roads, it would be used to pay down the Chinese loan.

The commitment was that in 2009-2010, 20 per cent of the increase from the cess would go to the RMF, 35 per cent last fiscal year, and 50 per cent this year. The Government has dishonestly failed to honour this very public commitment

Only 20 per cent was paid over to the RMF last financial year instead of the projected 35 per cent, a Cabinet decision which the auditor general says is a violation. The technocrats managing the RMF have expressed concern that the fund will be unable to service the loan after this April if the Government does not pay over the income as was promised at 35 per cent in year two and 50 per cent in year three. So much for 'fiscal responsibility' on this one.

[ReggaeMike]

Well I've read it and I noticed this bit:

So let's work out the numbers then shall we?

They have a $340 million loan from China's EXIM bank.

Based on this article: http://www.opm.gov.jm/news_and_publi...vement_project

The interest rate is 3% and there is a moratorium of 5 years and repayment is due in 15 years (presumably after the 5 year moratorium):

Regarding the road network infrastructure work, Mr. Vaz advised that China has provided US$340 million of the US$400 million it will cost to execute same, with the government to put up the remainder of the funding. The interest rate is three per cent, with a moratorium of five years and a repayment period of 15 years.

So with 3% annual interest we would be looking at over $420 million in repayment and maybe $490 million in repayment (that is only with simple interest and depends on if the simple interest applies entirely to the original sum or the outstanding sum - if it was compound interest you can expect a repayment total well in excess of $500 million).

So let's be generous and assume the total repayment is $420 million.

[ReggaeMike]

So let's work out the numbers then shall we?

They have a $340 million loan from China's EXIM bank.......

So let's be generous and assume the total repayment is $420 million.

The loan is supposed to be repaid with an extra tax on fuel. Fuel in Jamaica is entirely imported. According to various sources Jamaica imports between 77,000 bbls (barrels) of oil per day (http://www.economywatch.com/economic...il_Production/ ) to 90,520 bbls a day (http://www.indexmundi.com/jamaica/oil_imports.html). Let's go with 90,520 barrels.

1 barrel of oil = 158.987295 litres

Therefore Jamaica imports 14,391,529.9434 litres of oil a day. We can round it up to 14,391,530 litres a day. That gives 5,252,908,450 litres a year. So in the space of 20 years (the longest possible time for the repayment of the loan if the information given means a 5 year moratorium followed by a 15 year repayment schedule) Jamaica would import 105,058,169,000 litres of oil and charge $8.75 on each litre. In that time the tax on the oil would garner: J$919,258,978,750. That should be more than enough to repay the $420 million (which is in US$ it seems and would be J$36.120 billion), except most of the tax isn't going to repay the loan (that's the odd thing). According to the article linked by Sass, it would be 20% of the tax in the first year going towards repayment, 35% in the second year and 50% in the third year (and presumably all years after). So in the first year it would be (($8.75 x 0.20) x 5252908450 =) J$9,192,589,787.5 and in the second year it would be J$16,087,032,128.125 and in the third year it should be J$22,981,474,468.75 for a total of J$48,261,096,384.375 out of a total of J$137,888,846,812.5 collected on the tax.


I've always wondered why Jamaican governments are in a habit of borrowing when they could apparently get the money they need without it and pay less as a result over the long term. That J$48 billion would be budgeted for repayment suggest that the interest is probably compound and not simple interest. However as the original cost of the project was J$36 billion it is curious that they didn't just institute the $8.75/litre tax in 2009-10 (or do it from 2008) and put 100% of it towards road repairs. In one year they should have theoretically collected J$45 billion from the tax. In fact they could have instituted a tax of $7 for just 1 year and collected a bit over the $36 billion required. Afterwards they could have then easily dropped the tax entirely.

I wonder where the other J$89 billion of tax money from the extra gas tax went though?

[ReggaeMike]

You are the one skipping... what's to stop the PNP from having some cost recovery mechanism fi fi dem JEEP?? Or perhaps that's exclusive to the JLP??

Well there is apparently J$89 billion from the gas tax that was supposed to repay the loan (more in theory since the amount budgeted did not correspond to the what was planned) which I haven't seen accounted for. Maybe it's just sitting around somewhere...

[Don1]

Assasin, Lazie & Co are not concerned with such analysis...whatever (positive) or self serving statement made by their hero politicians to spin a web of deceit is what they concentrate on.

The fact is that once JLPNP politicians identify a project which is essential to their political survival... they will find a way to fund it... obviously because that's their main goal... political survival

That makes the funding issue entirely secondary...what will happen is that they announce something on funding which appears plausible...then over time as other political exigencies appear on their radar they switch to that...and the funding is diverted elsewhere.

Anyone who believes that US$400m loan will be paid up in the specified time, using the specified mechanism is a fool... and that cap fits whether this was a JLP or PNP promulgated project... we will undoubtedly be paying for that 2 generations from now...or the lender will write it down

In the matter of political survival strategies both tribes are identical

Selah

[Don1]

Well there is apparently J$89 billion from the gas tax that was supposed to repay the loan (more in theory since the amount budgeted did not correspond to the what was planned) which I haven't seen accounted for. Maybe it's just sitting around somewhere...

Don't aks me..aks di JLP

[Muadib]

yuh have time...

[Don1]

The loan is supposed to be repaid with an extra tax on fuel. Fuel in Jamaica is entirely imported. According to various sources Jamaica imports between 77,000 bbls (barrels) of oil per day (http://www.economywatch.com/economic...il_Production/ ) to 90,520 bbls a day (http://www.indexmundi.com/jamaica/oil_imports.html). Let's go with 90,520 barrels.

1 barrel of oil = 158.987295 litres

Therefore Jamaica imports 14,391,529.9434 litres of oil a day. We can round it up to 14,391,530 litres a day. That gives 5,252,908,450 litres a year. So in the space of 20 years (the longest possible time for the repayment of the loan if the information given means a 5 year moratorium followed by a 15 year repayment schedule) Jamaica would import 105,058,169,000 litres of oil and charge $8.75 on each litre. In that time the tax on the oil would garner: J$919,258,978,750. That should be more than enough to repay the $420 million (which is in US$ it seems and would be J$36.120 billion), except most of the tax isn't going to repay the loan (that's the odd thing). According to the article linked by Sass, it would be 20% of the tax in the first year going towards repayment, 35% in the second year and 50% in the third year (and presumably all years after). So in the first year it would be (($8.75 x 0.20) x 5252908450 =) J$9,192,589,787.5 and in the second year it would be J$16,087,032,128.125 and in the third year it should be J$22,981,474,468.75 for a total of J$48,261,096,384.375 out of a total of J$137,888,846,812.5 collected on the tax.


I've always wondered why Jamaican governments are in a habit of borrowing when they could apparently get the money they need without it and pay less as a result over the long term. That J$48 billion would be budgeted for repayment suggest that the interest is probably compound and not simple interest. However as the original cost of the project was J$36 billion it is curious that they didn't just institute the $8.75/litre tax in 2009-10 (or do it from 2008) and put 100% of it towards road repairs. In one year they should have theoretically collected J$45 billion from the tax. In fact they could have instituted a tax of $7 for just 1 year and collected a bit over the $36 billion required. Afterwards they could have then easily dropped the tax entirely.

I wonder where the other J$89 billion of tax money from the extra gas tax went though?

RMike...the flaw here is that only a % of Jamaica's oil imports is used to power vehicles...if memory serves it is <30%

Most imported oil is used for electric power generation...

So there is probably no missing billions

[Assasin]

So why did you ask about the time frame then?

No wonder 500 years seems realistic to you.

You don't think the Chinese want back them money?

Is a good thing we have the IMF to take care of all of that, them say no more slush fund without revenue.

You can call who you want fool but we know a who a di fool claiming they have no knowledge and not interested in it but have the most talk.

[Don1]

yuh come back wid dis silly argument? mi did call yuh fool? If yuh waan hug up dat tikle mi nah tap yuh if yuh feel yuh qualify

yes...mi nuh ave much intress inna JEEP fi fine out nuff detail... suh wha?

Mi nah tap yuh wid fi yuh intress dem... suh grant mi dat favor said speed

Doan tes mi...mi ah try hole it dung tudeh afta mi haffi ruff up yuh political companero wheyday...suh doan draw mi tung yute

[Karl]

...and that is what Governments do.
They either introduce a transparent 'tax'...or institute funding = tax hidden 'deep' in some other 'program/proposal' that hogs the limelight and thus that 'funding/tax' is not easily seen by the common man.

Every government loan taken carries with it its servicing costs = its tax. The details of "JEEP"....funding will be found as Sista P says. Is it more 'fluff' or just an election tool than good policy? That we shall know in time.

Nuh suh dem haul spin di new great/big sinting dat a guh mek wi tek off? ...as mi seh wi still poised fi tek off...

Sista P mi put fi mi faith innah.
Hwenny which way yuh luk pan hit haul di man dem fail wi.
So the more realistic Sista P a weh mi put mi hat.