The International Monetary Fund’s mission team to Jamaica has agreed to loosen the purse strings, relaxing Jamaica’s primary surplus target under the current extended fund facility. This, according to Minister of Finance Peter Phillips, will give the government an additional $4 billion to spend this year and $8 billion next year. And, on Tuesday the government received $2.3 billion from the European Union to support debt reduction and growth enhancement.
But, amid anticipation for an early general election this year, Jamaica Labor Party (JLP) official and former Minister of Finance Audley Shaw argued that these recent decision from international groups “could be interpreted as political interference…as it could free up the government to embark on an election spending spree.”
The original IMF restrictions had forced the government to hold back spending on several social projects to generate faster economic growth – which also would be a boon for the ruling People’s National Party (PNP) going into election season.
Jamaican economist Derwent Lindsay said one of the more profound benefits the government could accrue from the new IMF and EU deals is the immediate launching of “projects with the potential to create more jobs, and ease chronic unemployment, especially among the youth.”
Besides Shaw, other JLP supporters have expressed cynicism with the timing of both international bodies. However, speaking at a PNP public rally in Portmore, St. Catherine on Sunday night, Prime Minister Portia Simpson Miller emphatically denied the allegations. She said the PNP had adequate campaign funding and emphasized that funding available to the government by the IMF’s decision “would be spent wisely.”
“We don’t need to get the IMF money to buy elections… it must be spent on the people of this country,” Simpson Miller said.
Meanwhile, the IMF team will be conducting its tenth review with Jamaica under the funding facility program next month. Barring unforeseen circumstances, Jamaica is expected to receive a successful review, which would grant the government an additional US$39 million.