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Ja's structural reforms must cut across political party lines
Friday, November 11, 2011
With the IMF Standby Arrangement seemingly unraveling, poverty and unemployment on the rise, necessary pension and tax reforms yet to take place, a debt mountain of J$1.5 trillion and a debt to GDP ratio rising to above 130 per cent it is imperative that the necessary structural reforms must be implemented expeditiously regardless of which political party wins the next general election in Jamaica.
Speaking with Caribbean Business Report earlier this week from JMMB's headquarters on Haughton Avenue, Kingston, Group CEO Keith Duncan said: "The IMF medium term plan requires that we come up with a credible plan which involves the implementation of tax reform, public sector rationalization and pension reform. These reforms have been outstanding for decades and over the years we have had many papers and Committees put forward solutions. The Matalon Report, the Orane Report and the list goes on. But successful political regimes have not been able to implement them due to lack of political will, organised resistance by the opposition to these reforms and losing sight of what is important choosing instead to score political points. It is very clear that we have not used the window of opportunity to implement these necessary structural reforms.
"One can speculate that these reforms have been long outstanding because we lack the political will as they would be hard to swallow in the short term but in the medium and long term would stimulate growth in the economy. We shouldn't have to wait for the IMF to give us an ultimatum,we should do what's right."
Duncan notes that as the implementation and execution of the required reforms lagged so has Jamaica's fiscal worries become even more challenging and its economy become less competitive. Even more disturbing is Jamaica's marginal growth over the last 25 years which has seen many other Caribbean countries outperform what ought to be one of the leading lights in the region.
"The reason we find ourselves in this present predicament is because we are not taking the hard decisions and executing what needs to happen to position us for growth. Whether the PNP or the JLP gets in power, tax reform, pension reform and public rationalization needs to happen. If they don't happen then our debt dynamic situation will get worse so to will our primary ratio surplus and our debt to GDP ratio. We are at a point where we cannot afford to allow this to happen.
If we do allow such a situation to happen what will occur is declining confidence in Jamaica's financial markets similar to what happened in Greece. Also we will see an increase in financing the widening debt," said JMMB's CEO.
Read more: http://www.jamaicaobserver.com/busin...#ixzz1dXBXYGAk
Friday, November 11, 2011
With the IMF Standby Arrangement seemingly unraveling, poverty and unemployment on the rise, necessary pension and tax reforms yet to take place, a debt mountain of J$1.5 trillion and a debt to GDP ratio rising to above 130 per cent it is imperative that the necessary structural reforms must be implemented expeditiously regardless of which political party wins the next general election in Jamaica.
Speaking with Caribbean Business Report earlier this week from JMMB's headquarters on Haughton Avenue, Kingston, Group CEO Keith Duncan said: "The IMF medium term plan requires that we come up with a credible plan which involves the implementation of tax reform, public sector rationalization and pension reform. These reforms have been outstanding for decades and over the years we have had many papers and Committees put forward solutions. The Matalon Report, the Orane Report and the list goes on. But successful political regimes have not been able to implement them due to lack of political will, organised resistance by the opposition to these reforms and losing sight of what is important choosing instead to score political points. It is very clear that we have not used the window of opportunity to implement these necessary structural reforms.
"One can speculate that these reforms have been long outstanding because we lack the political will as they would be hard to swallow in the short term but in the medium and long term would stimulate growth in the economy. We shouldn't have to wait for the IMF to give us an ultimatum,we should do what's right."
Duncan notes that as the implementation and execution of the required reforms lagged so has Jamaica's fiscal worries become even more challenging and its economy become less competitive. Even more disturbing is Jamaica's marginal growth over the last 25 years which has seen many other Caribbean countries outperform what ought to be one of the leading lights in the region.
"The reason we find ourselves in this present predicament is because we are not taking the hard decisions and executing what needs to happen to position us for growth. Whether the PNP or the JLP gets in power, tax reform, pension reform and public rationalization needs to happen. If they don't happen then our debt dynamic situation will get worse so to will our primary ratio surplus and our debt to GDP ratio. We are at a point where we cannot afford to allow this to happen.
If we do allow such a situation to happen what will occur is declining confidence in Jamaica's financial markets similar to what happened in Greece. Also we will see an increase in financing the widening debt," said JMMB's CEO.
Read more: http://www.jamaicaobserver.com/busin...#ixzz1dXBXYGAk
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