Jamaica: Second Review Under the Extended Arrangement Under the Extended Fund Facility and Request for Modification of Performance Criteria

Publication Date: December 27, 2013
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Summary: EXECUTIVE SUMMARY Macroeconomic developments are broadly in line with program projections. There are signs of a gradual recovery from the effects of the global financial crisis and hurricane Sandy. Real GDP growth for 2013/14 is projected at just under 1 percent, supported by improved activity in the tourism, mining, and agricultural sectors. Inflation has increased due to the depreciation of the exchange rate as well as higher administered prices in the context of the recent fiscal package. International reserves are in line with program requirements, but remain low. The execution of the 2013/14 budget has remained broadly on track. Strong implementation of the program would lay the foundation for sustained economic growth. Program performance is on track, in spite of the difficult economic environment. Jamaica’s four-year, SDR 615 million (225 percent of quota) Extended Arrangement under the EFF was approved by the IMF Executive Board on May 1, 2013. All end-September quantitative performance criteria and structural benchmarks were met. The macroeconomic outlook and financing scenario remain broadly in line with earlier projections. The authorities are pressing ahead with the next round of reforms, including strengthening the fiscal policy framework, reforming the securities dealers sector, and enhancing public financial management. Program risks. Risk to the program remains high, including possible external shocks, weak confidence and anemic external demand that could hamper the growth recovery, shortfalls in budget financing and revenue collection, and policy slippages. Appraisal. Based on the performance to date and the authorities’ updated policy intentions and commitments, staff recommends completion of the second review under the EFF.
Series: Country Report No. 13/378
Subject(s): Extended Fund Facility | Fiscal policy | Fiscal reforms | Financial sector | Monetary policy | Economic indicators | Staff Reports | Press releases | Performance criteria modifications | Jamaica

Publication Date: December 27, 2013
ISBN/ISSN: 9781484336434/1934-7685 Format: Paper
Stock No: 1JAMEA2013003 Pages: 82
US$18.00 (Academic Rate:
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