PIOJ Growth-Inducement Strategy - Planning Institute of Jamaica
PIOJ Growth-Inducement Strategy - Planning Institute of Jamaica
PIOJ Growth-Inducement Strategy - Planning Institute of Jamaica
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Chapter 6<br />
________________<br />
Assessment <strong>of</strong> and Recommendations for<br />
the Current Fiscal/Financial Programme 29<br />
Summary<br />
While the Country’s over-performance in meeting the financial targets under the<br />
February 2010 IMF Fiscal Consolidation SBA deserves the high praise it has been<br />
getting, <strong>PIOJ</strong> analysis compels bringing immediate attention to the corresponding<br />
significant negative out-turns in the real and social sectors, and in influential leading<br />
economic indicators.<br />
Below and attached are data and analysis in support <strong>of</strong> the <strong>PIOJ</strong>’s assessment which<br />
concludes the following:<br />
1. The current recession, where <strong>Jamaica</strong> is producing below its potential, is being<br />
worsened by the pro-cyclical nature <strong>of</strong> the IMF programme.<br />
2. Without immediate adjustment, the economic programme will achieve neither<br />
financial or fiscal stability and sustainability, nor sustainable job-creating<br />
economic growth, in the medium-term.<br />
3. Near-term political economy will pose a critical challenge to the sustainability,<br />
and hence credibility <strong>of</strong> the current economic programme and policy stance.<br />
Specifically there has been:<br />
rising levels <strong>of</strong> unemployment and poverty<br />
rise in real interest rate and fall in demand for loans<br />
rise in bad debts<br />
fall in consumer confidence in line with a decline in purchasing power and fears<br />
<strong>of</strong> future job losses.<br />
29 In consultation with the Economic <strong>Planning</strong> and Research Division, <strong>PIOJ</strong>. Data and analysis in this<br />
chapter first presented on September 16, 2010.<br />
82