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The Private Sector Organisation of Jamaica (PSOJ) has given qualified support to the National Debt Exchange Offer, announced on Monday night by the government.
While highlighting the negative impact on holders of Government instruments Christopher Zacca, PSOJ president, said the majority of the banks were cognizant of the need for the debt programme.
“…And in favour of volunteering to once again step up to the plate and help the country by doing a second debt exchange in three years - must commend them for that. It is not going to be easy; it affects pensions, etc., but I think we all realise we have to come together at this time and put together a programme that will rescue Jamaica’s economy and get our debt down over time,” said Mr. Zacca.
The PSOJ head said the banks are hoping for a turnaround in the economy which will help them to recoup their losses.
“By ensuring that the government sticks to what it says it is going to do, and therefore there will be less risk perceived; and maybe upgrading of the Jamaican economy and therefore they could recoup some of these losses by a better performing economy.”
Audley Shaw, Opposition Spokesman on Finance said there could be positive spin-offs from the National Debt Exchange.
However, Mr. Shaw said this will be dependent on the programme’s successful implementation.
“I think that if it is successful then it would result in lower interest rate which will not only help the national budget, but also could contribute to keeping the interest rates in the commercial banking sector - either keeping them where they are or hopefully getting them lower than where they are now.”
He, however, gave a lukewarm response to Monday night's joint address. Mr. Shaw said it lacked specifics on the progress in the negotiations for a new IMF deal.
Omar Azan, past president of the Jamaica Manufacturers' Association (JMA) argued that despite the pending IMF agreement, local businesses will still face a harsh reality
While highlighting the negative impact on holders of Government instruments Christopher Zacca, PSOJ president, said the majority of the banks were cognizant of the need for the debt programme.
“…And in favour of volunteering to once again step up to the plate and help the country by doing a second debt exchange in three years - must commend them for that. It is not going to be easy; it affects pensions, etc., but I think we all realise we have to come together at this time and put together a programme that will rescue Jamaica’s economy and get our debt down over time,” said Mr. Zacca.
The PSOJ head said the banks are hoping for a turnaround in the economy which will help them to recoup their losses.
“By ensuring that the government sticks to what it says it is going to do, and therefore there will be less risk perceived; and maybe upgrading of the Jamaican economy and therefore they could recoup some of these losses by a better performing economy.”
Audley Shaw, Opposition Spokesman on Finance said there could be positive spin-offs from the National Debt Exchange.
However, Mr. Shaw said this will be dependent on the programme’s successful implementation.
“I think that if it is successful then it would result in lower interest rate which will not only help the national budget, but also could contribute to keeping the interest rates in the commercial banking sector - either keeping them where they are or hopefully getting them lower than where they are now.”
He, however, gave a lukewarm response to Monday night's joint address. Mr. Shaw said it lacked specifics on the progress in the negotiations for a new IMF deal.
Omar Azan, past president of the Jamaica Manufacturers' Association (JMA) argued that despite the pending IMF agreement, local businesses will still face a harsh reality