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published: Sunday | September 16, 2007
Keith Collister, Sunday Gleaner Writer
Myers
Business leaders want the newly installed Jamaica Labour Party (JLP) government to take urgent steps to ease the country's debt burden, as well as to reduce the perennial gap between revenue and expenditure.
Arguing that the country needs to break out of its "decades-old vicious circle of debt and deficits", Mark Myers, president of the Jamaica Chamber of Commerce, is urging the Bruce Golding-led administration to sell between US$200 million and US$ 400 million of state assets, then use the proceeds to pay down the debt. According to the Ministry of Finance, at the end of June, total debt stood at $920 billion.
Progress eroded
Private sector leaders had initially proposed this approach to addressing the nation's burgeoning debt during talks with the previous administration to establish a social partnership, dubbed 'Partnership for Progress'. But Myers, expressing concern over the recent disclosure of further deterioration in the fiscal situation, indicates that all the initial progress made on the fiscal front during the first couple of years of the Partnership for Progress initiative has been reversed.
Despite the official Ministry of Finance numbers for April to July suggesting that the budget deficit was $16.62 billion, recent disclosures have suggested that the true deficit is at least $15.4 billion higher. This comprises $12.4 billion in recurrent expenditure, reflecting mainly expenditure on additional wages, pension and other social spending, such as health, that were apparently not budgeted for in April; and $3 billion in capital expenditure, of which less than $600 million appears to be related to Hurricane Dean.
The one bright spot appears to be that tax revenues are slightly above target, suggesting that it is expenditure that is feeding the yawning fiscal deficit.
Industry leaders believe with the global economy approaching a difficult period, the new administration must act quickly if the country, weaned on successive years of anaemic growth, is to achieve robust economic performance.
Government procurement
In this regard, president of the Private Sector Organisation of Jamaica (PSOJ), Chris Zacca, says the new Government's first task should be to come up with measures to help stimulate the economy.
He stresses that Jamaica needs "a partnership approach", adding that the "private sector is strongly committed to supporting the new Government to take the country forward".
Jamaica Manufacturers' Association (JMA) President, Omar Azan, wants the new government to remove customs user fees as a matter of priority, as well as implement a preferential policy on government procurement.
With Government being the largest procurer in Jamaica, the JMA proposes that a local company should be able to bid up to 10 per cent above a foreign competitor and still win a Government contract.
Keith Collister, Sunday Gleaner Writer
Myers
Business leaders want the newly installed Jamaica Labour Party (JLP) government to take urgent steps to ease the country's debt burden, as well as to reduce the perennial gap between revenue and expenditure.
Arguing that the country needs to break out of its "decades-old vicious circle of debt and deficits", Mark Myers, president of the Jamaica Chamber of Commerce, is urging the Bruce Golding-led administration to sell between US$200 million and US$ 400 million of state assets, then use the proceeds to pay down the debt. According to the Ministry of Finance, at the end of June, total debt stood at $920 billion.
Progress eroded
Private sector leaders had initially proposed this approach to addressing the nation's burgeoning debt during talks with the previous administration to establish a social partnership, dubbed 'Partnership for Progress'. But Myers, expressing concern over the recent disclosure of further deterioration in the fiscal situation, indicates that all the initial progress made on the fiscal front during the first couple of years of the Partnership for Progress initiative has been reversed.
Despite the official Ministry of Finance numbers for April to July suggesting that the budget deficit was $16.62 billion, recent disclosures have suggested that the true deficit is at least $15.4 billion higher. This comprises $12.4 billion in recurrent expenditure, reflecting mainly expenditure on additional wages, pension and other social spending, such as health, that were apparently not budgeted for in April; and $3 billion in capital expenditure, of which less than $600 million appears to be related to Hurricane Dean.
The one bright spot appears to be that tax revenues are slightly above target, suggesting that it is expenditure that is feeding the yawning fiscal deficit.
Industry leaders believe with the global economy approaching a difficult period, the new administration must act quickly if the country, weaned on successive years of anaemic growth, is to achieve robust economic performance.
Government procurement
In this regard, president of the Private Sector Organisation of Jamaica (PSOJ), Chris Zacca, says the new Government's first task should be to come up with measures to help stimulate the economy.
He stresses that Jamaica needs "a partnership approach", adding that the "private sector is strongly committed to supporting the new Government to take the country forward".
Jamaica Manufacturers' Association (JMA) President, Omar Azan, wants the new government to remove customs user fees as a matter of priority, as well as implement a preferential policy on government procurement.
With Government being the largest procurer in Jamaica, the JMA proposes that a local company should be able to bid up to 10 per cent above a foreign competitor and still win a Government contract.
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