IMF cannot fix Jamaica’s problems !

We want to live champagne lifestyle on a beer salary and that is not sustainable .

The IMF Chief just left and she indicated she was pleased with the “progress” that Jamaica has made under the program, but what does all this means in real terms.

Well for one it means we are now in a better position to pay the IMF and the those that IMF has agreed with to lend money to Jamaica. The dollar is at an all time low but IMF is suggesting it still has a long way to go, to get Jamaicans to reduce spending hard earn forex on overseas purchase, but this will never work given our voracious appetite for foreign goods..

Jamaican manager love for expensive SUV to adorn their carparks,  while running 1960’s equipment is yet another part of our problem, which requires a mindset to change if we intend to move forward

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12 Responses

  1. Apparently the article below is causing your negative outlook to shift with the winds. Is Christine Lagarde a Comrade? Again, is it the demand for US dollars that is causing the devaluation of the Jamaican currency or not? You seem to be supporting that theory indirectly:

    …..to get Jamaicans to reduce spending hard earn forex on overseas purchase,…..

    ……Jamaican manager love for expensive SUV to adorn their carparks, while running 1960′s equipment…..

    Leadership For The Times – IMF Boss Salutes Portia, Peter For Putting Jamaica Back On Track

    Prime Minister Portia Simpson Miller and Finance Minister Dr Peter Phillips have received the endorsement of head of the International Monetary Fund (IMF), Christine Lagarde, who has expressed satisfaction with their leadership in implementing the Fund-supported economic reform programme.

    “I wanted to pay tribute to Minister Phillips and to his colleagues, under the leadership of the Most Honourable Prime Minister, for what has been a clear change of course, not only in the relationship between Jamaica and the IMF, but a change of course in deciding to tackle the issues head-on and to make the hard choices and successfully complete four reviews,” said Lagarde, who left the island yesterday after a two-day working visit.

    Jamaica inked a four-year extended fund facility with the IMF on May 1, 2013, nearly two years after the collapse of a standby agreement which was inked by the Bruce Golding-led Government in 2010.

    “The story of Jamaica with the IMF has been bumpy, to say the least. Programmes started, pro-grammes suspended, programmes renewed, programmes resuspended, and what I am saying here to the authorities, to the private sector, civil-society representatives, it is important that you stay the course, and it is important that you don’t waste the outstanding results that you have already put under your belt in the last 15 months,” said the IMF boss.

    ‘SUPERB WORK’

    Lagarde described Phillips’ management of the economy programme as “astonishing”, saying the results thus far reflect “superb work”.

    She also described as “thorough” a discussion she had last Friday morning with Simpson Miller about what additional structural reform needs to be implemented.

    “To be greeted by a woman of that calibre is a rare privilege,” said Lagarde in reference to the prime minister.

    So far, the Government has had to implement a wage freeze for public-sector workers, a debt exchange, and new taxes, as well as structural reforms such as the passage of fiscal rules to curtail spending, and the depreciation of the currency, which the IMF said was overvalued.

    “The track record of Jamaica, let’s face it, was not really the best that you could think of,” said Lagarde.

    Lagarde quoted an African proverb which she says describes Phillips’ approach to economic management.

    “There is no favourable wind for a sailor who knows where he is going,” she said in tribute to Phillips. “You know where you want to go and there will be externalities. God forbid that there is a hurricane in the next few weeks because the season is coming; God forbid that the US economy goes south rather than north, … but you know where you want to go, and I hope you will achieve that journey for the people of Jamaica.”

    Meanwhile, Lagarde said Simpson Miller is the “best possible advocate” that the most vulnerable Jamaicans could have. She said that owing to the nature of the adjustments required under the IMF programme, the process will be painful and, therefore, the most vulnerable must be protected.

    “If anybody can be the best advocate of this requirement, it is the Most Honourable Prime Minister, who is extremely focused on it,” she said.

    Phillips later told The Sunday Gleaner that the recognition of the IMF and the international markets is an endorsement of Jamaica’s ability to undertake corrective action as far as its own economic institutions and prospects are concerned.

    “We have to grasp that the essential requirement for any independent country is this ability to manage our affairs with our own resources and to take a place alongside other nations that are doing the same thing,” said Phillips.

    http://jamaica-gleaner.com/gleaner/20140629/news/news1.html

    • Coming from minus to zero is really not as big achievement.

      I will start praising when I see results in reality and not on paper.

  2. The IMF CHIEF sounds like a comrade, using PSM to ride the back of poor Jamaicans into thinking that they really care.

    Give me a break !

    • Do not waste your time on people like him. There is a big difference between fiscal reform and structural reform, despite the IMF programme it became harder to do business in Jamaica, we moved from 90 to 94 and waste is still rampant in the public sector. Portia and and Peter are depending on the IMf to solve the country’s problem, they have no vision for themselves.

  3. Some years from now people will look back on this and wonder what the hell were we thinking. This is the IMF deal in a nutshell:

    Freeze wages
    Withhold payments for goods and services
    Heap more taxes on the persons/entities already paying taxes
    Devalue the dollar

    Where is the growth to come from? What is being done about the public sector? What of the Public Sector Transformation Unit? What are the areas of emphasis for export?

    Given the track record of these people in government I have no confidence in them getting the country back on track.

    Do people realise that devaluation has increase the external debt. How does that reconcile with the programme to reduce the debt to gdp ratio?

    • Calsonic the people are being tricked, the debt to gdp ratio has been reduced but the debt has grown it is now over 1.94 trillion

      • In case you forget, the JLP was responsible for nearly doubling the debt in a 4-year span, while Audley Shaw was thumping is chest about the amount of the “low interest” loan debt debt he was able to secure. What Shaw failed to inform the gullible population was that the low rate he was quoting was the “introductory” rate, which was only “low” for a short period as six months or so and after that, raise to the levels of the high interest rate loans he was seeking to replace (I think he label the interest rates of these loans as junk bond rate). Keep drinking that tainted Kool-aid Lipton. Your party is destined for another 20 years in the wilderness, as the PNP pulled a master card, having the head of the IMF heaping praise on the PSM lead team. Jay, Calsonic and Lipton heads are hurting badly just about now. BTW, she will be back just about election time to say how great the PNP is for Jamaica. You guys should organize a million-man march on halfway tree to protest the pain that the PNP is causing. Oops, the JLP doesn’t even have support for 25K…..hahahaha……….aaaaaaaaaaa

        • IMF Chief heaping praises on a worthless bunch, BTW the IMF chief is not too squeaky clean either.

          IMF chief Christine Lagarde dodged disaster on Friday as French prosecutors decided not to place the ex-finance minister under formal investigation over her role in a 285 million euro government payout to a controversial businessman in 2008.

          Somehow the PNP always seems to be able associated with dodgy characters.

        • Wayne, I have no political party. However, the statements of Lagarde have resonated with no one, maybe sensible people like me and Jay should create a lobby group to challenge the nonsense of this administration.

        • Lipton: Finish law School and then we can talk about your future. I will wager by that time you will be a Comrade and we can plan a path to “Comradeship”. You will definitely have more sense too, a necessity to be part of a great fraternity. Jay on the other hand is loss cause, since he switched allegiance and went from a Comrade to a Labourite. There is no way we will have him back. 🙂

  4. I will never be a comrade, I am a firm believer in the free market and neither party understands the complexity of the free market economy, so maybe I will just start my own party.

  5. Published in gleaner

    Private sector must embrace finance smes- start ups

    It is widely acknowledged that globally competitive small businesses will rescue Jamaica from its present economic malaise. Small and medium-size enterprises are major providers of employment, accounting for 60 to 70 per cent of jobs in most developed countries.

    Although the country’s economic fortunes are hinged on the prosperity of SME start-ups, it must be noted that the road to success will be arduous.

    According to a 1996 study conducted by the OECD, fewer than half of SME start-ups survive for five years, with a small number of surviving SMEs transforming into high-growth firms. A more recent report compiled by Harvard researchers asserts that about three-quarters of venture-backed firms in America don’t return investors’ capital and ultimately fail.

    It is not the intention of anyone to discourage prospective entrepreneurs from starting a business because of the possibility of failure, but this is the reality of entrepreneurship. It’s a risk and if you are averse to risks, maybe you shouldn’t be an entrepreneur.

    This point was reinforced by entrepreneur Paul Saffo, when quizzed by the British media about the success of Silicon Valley. “Failure is what makes Silicon Valley’s success to hard to replicate. Would-be competitors only see, and try to copy, the Valley’s success. But to succeed, you need an ecology of fearless players, from venture capitalists to banks, suppliers and myriad other supporting businesses unafraid to risk all by helping with often flaky and unpredictable start-ups.

    “So if you want to be the next Silicon Valley, don’t copy our success. Learn to support and encourage novel and ultimately successful failure,” he said.

    Venture-capital financing for small businesses has also become a popular topic. Some are even clamouring for government-supported schemes, but such an activity is the forté of the private sector. A growing number of young Jamaicans are creating start-ups, therefore, the local private sector must embrace the challenge by providing these initiatives with financing.

    FAILURE IS ESSENTIAL

    This administration may be dithering on business reforms, but the private sector can no longer continue to put off investments because of a fear of failure, because failure is an essential ingredient to success. Furthermore, private entrepreneurs should not give the impression that bureaucrats are to blame for everything, because some things are not in their control.

    Nothing is stopping the Private Sector Organisation of Jamaica from starting a venture capital network similar to organisations in developed countries, or a wealthy investor from creating a venture-capital firm. Our wealthy businessmen must not allow their fear of failure to prevent them from engaging in venture-capital schemes; if they do not take the lead in this scenario, cynics will propagate the view that private entrepreneurs are lazy and it will be very hard to restore their credibility

    Lipton Matthews

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