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Insisting that Jamaica, in its current circumstances, has no option but to maintain a borrowing arrangement with the International Monetary Fund (IMF), the People's National Party (PNP) indicated yesterday that concluding a three-year facility with the fund would be among its priorities if it forms the government after the December 29 general election.
But Dr Peter Phillips, the party's shadow finance spokesman, also made it clear that it was the party's position that the recovery of the Jamaican economy rested not only on contraction - a fault he identified with the Government's stalled agreement with the International Monetary Fund - but on generating economic growth.
"Let me say this, too, there is not a great window available to you ... to come to an agreement," Phillips told journalists yesterday in the first coherent, even if broad, outlines of the party's economic policies.
Phillips also, like the Government, committed the Opposition party to tax reform to bring more people into the net, a restructuring of the public sector, as well as a reform of the pension system for government employees to contribute to their pensions.
The PNP's unequivocal commitment to a borrowing agreement with the IMF was perhaps the most significant undertaking, coming in the face of the Government's suspended standby agreement with the fund and Finance Minister Audley Shaw's equivocation in a CVM-TV interview Wednesday night on what the Jamaica Labour Party (JLP) administration, if re-elected, would do.
End of agreement
The existing 27-month agreement, on which programmed quarterly tests have not taken place for a year, comes to an end in March, and Shaw was asked what would follow.
Said the minister: "It is something I am now taking advice on. The governor (of the Bank of Jamaica) is now having discussions with the IMF as to which is the most appropriate. It can be a normal Article IV surveillance, or it can be an intensified surveillance." Under (an) Article IV consultation, IMF staff undertake annual surveillance and analysis of economic developments and policies of member countries for discussion by the executive board.
Although Shaw insisted notwithstanding that even with the stalling of the IMF programme, the Government had maintained fiscal prudence, analysts and political critics argued that the finance minister's remarks could spook lenders and unnerve rating agencies, which have already put the country on watch for a downgrade deeper into junk bond territory.
Mark Golding, who shadows commerce for the PNP, said that until it was able to put itself in a position to creditably return to the capital markets, Jamaica would continue to need the "protection of the IMF".
Phillips stressed the PNP's acceptance of the need to contain public-sector spending, eliminate waste and enhance transparency.
Nonetheless, a PNP administration would negotiate an agreement "with greater emphasis on growth and development" as the core of its programme to manage the country's debt, which now stands at over 130 per cent of annual output.
"This agreement will be based on the establishment of credible, predictable and achievable macroeconomic targets that would inspire confidence among local and international investors, as well as stakeholders," Phillips said.
Among the PNP's initiatives to drive growth would be a renegotiation of the light and power company Jamaica Public Service's (JPS) monopoly right over the transmission and distribution of electricity.
At over US 40 cents per kilowatt hour, the cost of electricity in Jamaica is among the highest in the Caribbean and is considered to be a significant drag on business. But the feasibility of breaking the JPS's transmission and distribution monopoly in a small economy has been a contentious issue.
But according to Phillip Paulwell, the party's spokesman on energy, it can be achieved by electricity generators paying an interconnection fee for use of the JPS's grid, as well as contribute to a universal access fund to prevent the "cherry picking" of customers and the denial of service to areas that are more difficult to serve. The Government would, subject to environmental oversight, remove itself from determining the petrol used by power generators, leaving that to the market.
A PNP government, according to Phillips, would also urgently revive a dormant plan for a US$1-billion upgrade and expansion of the 30,000-barrels-a-day Petrojam oil refinery on the basis of a partnership with Venezuela, which owns 49 per cent of the refinery, "and private-sector investors".
Paulwell argued that an upgraded refinery could produce enough petcoke to generate 100 megawatts, at costs cheaper than other fuels, except nuclear.
business@gleanerjm.com
http://jamaica-gleaner.com/gleaner/2...business1.html
But Dr Peter Phillips, the party's shadow finance spokesman, also made it clear that it was the party's position that the recovery of the Jamaican economy rested not only on contraction - a fault he identified with the Government's stalled agreement with the International Monetary Fund - but on generating economic growth.
"Let me say this, too, there is not a great window available to you ... to come to an agreement," Phillips told journalists yesterday in the first coherent, even if broad, outlines of the party's economic policies.
Phillips also, like the Government, committed the Opposition party to tax reform to bring more people into the net, a restructuring of the public sector, as well as a reform of the pension system for government employees to contribute to their pensions.
The PNP's unequivocal commitment to a borrowing agreement with the IMF was perhaps the most significant undertaking, coming in the face of the Government's suspended standby agreement with the fund and Finance Minister Audley Shaw's equivocation in a CVM-TV interview Wednesday night on what the Jamaica Labour Party (JLP) administration, if re-elected, would do.
End of agreement
The existing 27-month agreement, on which programmed quarterly tests have not taken place for a year, comes to an end in March, and Shaw was asked what would follow.
Said the minister: "It is something I am now taking advice on. The governor (of the Bank of Jamaica) is now having discussions with the IMF as to which is the most appropriate. It can be a normal Article IV surveillance, or it can be an intensified surveillance." Under (an) Article IV consultation, IMF staff undertake annual surveillance and analysis of economic developments and policies of member countries for discussion by the executive board.
Although Shaw insisted notwithstanding that even with the stalling of the IMF programme, the Government had maintained fiscal prudence, analysts and political critics argued that the finance minister's remarks could spook lenders and unnerve rating agencies, which have already put the country on watch for a downgrade deeper into junk bond territory.
Mark Golding, who shadows commerce for the PNP, said that until it was able to put itself in a position to creditably return to the capital markets, Jamaica would continue to need the "protection of the IMF".
Phillips stressed the PNP's acceptance of the need to contain public-sector spending, eliminate waste and enhance transparency.
Nonetheless, a PNP administration would negotiate an agreement "with greater emphasis on growth and development" as the core of its programme to manage the country's debt, which now stands at over 130 per cent of annual output.
"This agreement will be based on the establishment of credible, predictable and achievable macroeconomic targets that would inspire confidence among local and international investors, as well as stakeholders," Phillips said.
Among the PNP's initiatives to drive growth would be a renegotiation of the light and power company Jamaica Public Service's (JPS) monopoly right over the transmission and distribution of electricity.
At over US 40 cents per kilowatt hour, the cost of electricity in Jamaica is among the highest in the Caribbean and is considered to be a significant drag on business. But the feasibility of breaking the JPS's transmission and distribution monopoly in a small economy has been a contentious issue.
But according to Phillip Paulwell, the party's spokesman on energy, it can be achieved by electricity generators paying an interconnection fee for use of the JPS's grid, as well as contribute to a universal access fund to prevent the "cherry picking" of customers and the denial of service to areas that are more difficult to serve. The Government would, subject to environmental oversight, remove itself from determining the petrol used by power generators, leaving that to the market.
A PNP government, according to Phillips, would also urgently revive a dormant plan for a US$1-billion upgrade and expansion of the 30,000-barrels-a-day Petrojam oil refinery on the basis of a partnership with Venezuela, which owns 49 per cent of the refinery, "and private-sector investors".
Paulwell argued that an upgraded refinery could produce enough petcoke to generate 100 megawatts, at costs cheaper than other fuels, except nuclear.
business@gleanerjm.com
http://jamaica-gleaner.com/gleaner/2...business1.html
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