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<TABLE cellSpacing=0 cellPadding=0 width="90%" border=0><TBODY><TR><TD class=news_postinfo><DIV>Wed Sep 13, 2006</DIV></TD></TR><TR><TD class=news_byline>IMF says govt may have to ditch sugar industry and Air J</TD></TR><TR><TD style="HEIGHT: 9px"></TD></TR><TR><TD class=news_para1><TABLE cellPadding=0><TBODY><TR><TD>
</TD></TR><TR><TD class=news_imagecaption></TD></TR><TR><TD class=news_summary>The International Monetary Fund (IMF) says the government might have to make tough decisions regarding the future of the ailing sugar industry and the cash-strapped national airline Air Jamaica. </TD></TR></TBODY></TABLE></TD></TR><TR><TD style="HEIGHT: 9px"></TD></TR><TR><TD class=news_body>In its interim staff report on Jamaica, released Tuesday, the IMF says the time has come for the authorities to act decisively to deal with the soaring losses from the sugar industry and might have to give up Air Jamaica if there is no turn around in its financial performance.
The government has been in control of Air Jamaica since December 2004 when it reclaimed it from the Butch Stewart-led Air Jamaica Acquisition Group.
But with no clear sign of what will become of the airline, the IMF is worried that it will remain a long-term financial burden on the government.
The IMF says it is concerned that Air Jamaica continues to rack up losses despite the implementation of a restructuring plan.
As a result, it says if the airline's restructuring plan fails to steadily improve its financial state the authorities might have to reconsider the merits of maintaining the entity.
Turning to sugar, the IMF says plans to diversify the industry into cane-based products such as ethanol and power co-generation might not be a good idea.
The Fund believes such a move will not be cost-effective.
However, it acknowledged that the issue was complicated because of the need to protect the large number of persons dependent on the sugar industry.
It says there is significant potential for rural areas to help supply the rapidly growing hotel sector with local produce and the focus should therefore be on helping cane farmers make the transition to other activities.
</TD></TR></TBODY></TABLE>
</TD></TR><TR><TD class=news_imagecaption></TD></TR><TR><TD class=news_summary>The International Monetary Fund (IMF) says the government might have to make tough decisions regarding the future of the ailing sugar industry and the cash-strapped national airline Air Jamaica. </TD></TR></TBODY></TABLE></TD></TR><TR><TD style="HEIGHT: 9px"></TD></TR><TR><TD class=news_body>In its interim staff report on Jamaica, released Tuesday, the IMF says the time has come for the authorities to act decisively to deal with the soaring losses from the sugar industry and might have to give up Air Jamaica if there is no turn around in its financial performance.The government has been in control of Air Jamaica since December 2004 when it reclaimed it from the Butch Stewart-led Air Jamaica Acquisition Group.
But with no clear sign of what will become of the airline, the IMF is worried that it will remain a long-term financial burden on the government.
The IMF says it is concerned that Air Jamaica continues to rack up losses despite the implementation of a restructuring plan.
As a result, it says if the airline's restructuring plan fails to steadily improve its financial state the authorities might have to reconsider the merits of maintaining the entity.
Turning to sugar, the IMF says plans to diversify the industry into cane-based products such as ethanol and power co-generation might not be a good idea.
The Fund believes such a move will not be cost-effective.
However, it acknowledged that the issue was complicated because of the need to protect the large number of persons dependent on the sugar industry.
It says there is significant potential for rural areas to help supply the rapidly growing hotel sector with local produce and the focus should therefore be on helping cane farmers make the transition to other activities.
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