Deal was sealed today for $US 932m. First draw down for $207m due in days
http://www.imf.org/external/pubs/ft/survey/so/2013/car050113a.htm
http://www.imf.org/external/np/sec/pr/2013/pr13150.htm
In an unprecedented move the IMF has allocated US$90M for budgetary support. This is an indication that the government is broke and the IMF has sought to offer the GOJ some help in this regard.
This all but confirms my assertion made last week that the GOJ is broke, which was the reason public sector wages were late and some teachers not getting paid until this week.
Warren's Blog 
Had the IMF deal fell apart (not approved), I’m sure your Headline would have been…”PNP Could Not Seal the Deal” or something along that line. Now that the deal has been secured, you conveniently elected not to include the words PNP in your headline. So negative headlines always include the word PNP and positive outcomes, the three letters are omitted.
To add insult to injury, your minimalist write-up quickly morphed into the fact that the GOJ is “broke”, since US$90M of the IMF funds will be used for “budget support”. No celebration of the hard work that our fellow Jamaicans have put into the endeavor for well over a year to get to this point. Right off the bat, you chose to take the negative approach (as usual) and start the “tearing down” process. You are so predictable. My guess is you are very disappointed that the “Pain-N-Poor” was able deliver, something you Labourites labored at for well over 2+ years and could not make any headway…..right? .
Knowing you, you will not provide a cogent response, instead you will make some silly remarks to the effect….”What is your position on Azan ??? ………Waiting…waiting…waiting….Will it ever come …… ” 😀
Test I have presented the facts, what is your problem young man. The fact is we got a deal, that was reported.
Fact – we have been given $90m in budgetary support , which is unprecedented !
What you want, is it that you want these facts ignored and we continue to jump and dance that the IMF deal is now going to save Jamaica.
I am not into that and you are confusing factual information with negative reporting.
Tell me what in this post in not true ?
I await your response 🙂
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IMF budget support…….unprecedented yes: http://www.ghanabusinessnews.com/2010/06/10/ghana-gets-469m-budgetary-support-from-imf-world-bank/
Definitely unprecedented. Never even considered before. Nope, not at all: http://www.jis.gov.jm/news/archive/21234-officePM-imf-may-give-jamaica-budget-support
So this would be the second such case in the history of the IMF.
I therefore stand corrected
At LEAST the second case. 2010 to 2013 is a long time in terms of loan history. I found the Ghana case within just 5 minutes of googling. I’m sure a more intrepid researcher could uncover more examples if they put in the effort.
And in an IMF paper from 2010 (http://www.imf.org/external/np/pp/eng/2010/032310.pdf) it is claimed that
“3. Both direct budget support (channeling of Fund purchases to the member via the Treasury) and indirect budget support (channeling of Fund purchases to the member via the central bank to finance the budget) have been widely used in past Fund arrangements, and are not temporary features of the current crisis. However, the incidence of direct budget support has increased in recent years, as (i) the global financial crisis and the required flexible fiscal response, and (ii) institutional changes in member countries, especially the move to greater central bank independence, have both called for lending to members to be channeled through Treasuries rather than central banks.”
Very good work Jon, I like this discussion.
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This is what I talk about when I mention laziness, they don’t bother to do any research. Great jog Jon.
This isn’t an “unprecedented” move at all really. According to Golding the IMF gave consideration to the suggestion by the GOJ under his leadership for budget support in 2009 (i.e. Golding’s IMF team asked for budget support in 2009) – whether or not one chooses to believe what Mr. Golding said (and is on record as saying in the JIS archive) is up to the individual. However it is interesting to note that Golding described the prospect in 2009 as potentially being able to “greatly assist” the country.
And the IMF (and World Bank) have provided budget support to at least one other country in the past (Ghana) to the tune of sums that make $90 look like pocket money. Sri Lanka also very recently sought out US$ 1 billion (that’s right, billion with a “b”) in budget support from the IMF in 2013 (that sum proved way to large for the IMF to swallow though).
Meanwhile around the same time the IMF pushed for international donors to release pledged budget support for Malawi in 2010 (Malawi being no stranger to such support having received budget support from Norway in 2002/03).
Antigua and Barbuda (which jay now uses to compare with Jamaica in terms of IMF/external lending programmes) in February 2013 sought budget support from the World Bank (through development policy loans) similar to the budget support policy loans provided by the CDB in the past.
And this is not the first time Jamaica has received budget support from external lenders. Jamaica received budget support from the World Bank to the tune of US$100 million in January 2009 and US$200 million in February 2010 and I believe US$100 million in September 2011.
The only reason this might be unprecedented in the specific case of Jamaica and the IMF (though certainly not in the case of the IMF from at least 2010) is that previously the IMF’s mission precluded it from providing loans for budget support even if it wanted to. To that end the IMF and World Bank acted in complementary roles with the IMF providing loans for (usually external) balance of payments support while the World Bank could provide loans for budget support. It seems though the IMF has changed its modus operandi and can now provide loans for budget support.
(actually it seems the IMF rejected the Sri Lanka request due to the timing of the request and not the amount).
I guess for you now that we have a deal approved its all good, right.
Continue to live in denial vs facing the cold hard reality,
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Jay, i expected Peter to get the job with the imf done. What has not been mentioned is that the funds that we are expecting and those from other multi-laterals will significantly increase our debt. What i am not convinced about are the plans to “grow” the economy. Minister of Announcements Paulwell, is not convincing, Roger Clark even less and these have to be two of the main drivers?
Roger Clarke is a “dud” and need to disappear. He has nothing in terms of plans and/or new ideas to add to this sector.
We cannot continue to treat agriculture as a “small man thing”, its big business. Most of us see it as d likkle man inna I’m water boot and straw hat and that is the reason its not considered to be a “sexy” industry.
As it relates to the energy sector, Paulwell had better start acting (not hollywood style) and stop speaking as much as he has been doing. Case in point, he announced that come next mth (June) we will have low sulphur diesel.
Today Petrojam says its now trying to source low or ultra low sulphur diesel. So Paulwell has jump ahead and announced an implementation date, yet we have not even done the basic work yet ie identify a source, have an agreement on a consistent supply of the product.
Yet when I speak about these things you hear some apologist say I am negative.
Well if highlighting these inconsistencies is being negative then yes I am and will continue to be negative.
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Look for my “negative” post. Now the the IMF deal has bee approved, the hard work begins in earnest.
Opps I guess I cannot write that as Test may just get upset . 😦
I should let the news of the approved deal and the thumping of the desk soak in for a while longer.
I might have to soften the tone of my comments in the future to avoid your mischaracterization of me as being upset. I’m just trying my best to keep you honest Jay, a very difficult task I must say, but one that must be done at all cost. I don’t think we want your unfettered imagination to go wild and unchecked. Go ahead with your usual treatise, but rest assured, I will be lurking in the background, ready to pounce on short notice.
Test come on, keeping me honest , is that a joke ?
Just keep reading on man. A few errors will be made from time to time and when that occurs the blog is always quick to note and stand corrected.
You views on this subject was not one where you sought to correct anything but a disagreement in how the post was written my the author vs how you would have written.
So don’t talk about keeping me honest, that is a misrepresentation of your actual comments.
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Are you getting upset? I was speaking in general terms and not specific to the topic at hand. Maybe I should have said “keep you on your toes” instead of honest? Weh yuh seh?
I’ve for some reason suddenly lost motivation to think about/discuss Jamaica’s economic situation or prospects. Still cautiously optimistic and hoping for the best but I’m not energized right now. Hmm…
Jamaica is a waste of time. We do not need a committee to ensure that the government performs. The politicians must have enough integrity and commitment
I have some amount of hope that we will make some headway with this deal and this is my reason.
“I am a serious business person. I am not there to do anybody’s bidding, and everybody that I have heard named to the committee, they are serious people too,” Byles told The Gleaner yesterday.
Byles, president and CEO of Sagicor Life, will co-chair the committee with Bank of Jamaica Governor Brian Wynter. The other members of the committee are Financial Secretary Devon Rowe; head of the coordinating and implementation unit in the Ministry of Finance, Dr Carol Nelson, who is serving in an interim capacity; and private-sector representatives Keith Duncan, Bruce Bowen, Patrick Hylton and Chris Zacca.
http://jamaica-gleaner.com/gleaner/20130502/lead/lead2.html
We CANNOT afford to fail and more and more the people who are “serious” about this little rock are willing to ensure that we dont fail.
Jay, Peter Phillips is one of the most competent politicians out there and one that I think is committed to Jamaica.If we are gonna save this sinking ship,he will have to be on the ball. The economy,(tangible real benefits) is what will determine whether the trajectory changes with the rampant criminality in our society or not.