Press Release No. 15/147

Press Release: IMF Executive Board Completes Seventh Review Under the IMF's Extended Fund Facility for Jamaica and Approves US$39 Million Disbursement

March 30, 2015

The Executive Board of the International Monetary Fund (IMF) today completed the seventh review of Jamaica’s economic performance under the program supported by a four-year, SDR 615.38 million (about US$932 million at the time of approval) arrangement under the Extended Fund Facility (EFF).

The completion of the review enables an immediate purchase of an amount equivalent to SDR 28.32 million (about US$39 million). The EFF arrangement was approved on May 1, 2013 (see Press Release 13/150).

Following the Board discussion of the review, Mr. Mitsuhiro Furusawa, Deputy Managing Director and Acting Chair, made the following statement:

“The authorities’ commitment to the program under the Extended Fund Facility remains strong. Program performance is on track and all quantitative performance targets for end-December were met. Structural reforms have progressed broadly on schedule.

“Macroeconomic performance continues to be good and economic confidence has reached a two-year peak. The decline in oil prices should help lower inflation expectations and boost demand. Still, stepping up the pace of reforms is essential to boost growth and employment. Bold efforts are needed to reform the energy sector, improve the business climate, and advance investment in critical infrastructure.

“The budget for 2015/16 demonstrates Jamaica’s continued fiscal discipline and will help keep public debt on a sustainable path. Maintaining the momentum for fiscal consolidation over the medium term requires boosting revenue and improving public sector efficiency. This involves strengthening customs and tax administration and further broadening the tax base. It is also essential to improve public financial management, accelerate the reform of the public sector, and contain public sector wage costs.

“Buttressing the financial sector hinges on meeting the key milestones for reforming the retail repo sector. Completing the transition of the retail repo businesses to a trust-based framework requires careful management. Implementing the Banking Services Act will be a necessary step to improve financial sector stability further.”