Beggin, beggin you

Photo by Heloise Bottomley.

Prime Minister Golding is putting his loving hand out to the International Monetary Fund for a loan to help Jamaica’s struggling economy.

It’s with a clear sense of desperation that he’s doing this; he’s reported as saying the factors that are leading down this path are :  the markets are not lending any money, downturn in bauxite and tourism, reduction in remittances.

The last time Jamaica got help from the IMF was not a great thing.  The list of conditions and strings attached, crippled the local economy through cuts in public spending which hurt the poor.  Throughout the 1970’s and 80’s, the loans mounted up and growth stayed low.

Will this time be any different really?  It’s supposed to be thinking differently - the IMF I mean, and they have outlined a whole new set of rules based around its’ loans.  But the Director of the IMF, Strauss Kahn says that they are “helping” Jamaica with its’ new tax initiatives.   Should Jamaica trust the IMF?

Trillion Dollar Debt

Photo by PhoeniX252

Jamaica has had some welcome relief from its huge, crippling debt.  It comes from the island’s old colonial masters, the UK.   £5 mill  that’s  $645  million Jamaican dollars has been written off.

It’s reported that the British government say this should help Jamaica concentrate on spending more on its’ public services.

It would indeed be a wonderful thing if Jamaica did improve its’ health services – anyone who has been inside Kingston Public Hospital would I think whole heartedly agree with that.

But with the calls from trade unions and wage demands coming from all sides, whether the savings can be made and re-directed into areas that can benefit the people of Jamaica and improve the economy in some way, I’m afraid I am feeling sceptical about whether this can be achieved.  Here’s a useful background article.

And this looks like a useful film to go see.

The last budget is reported to show fifty per cent of every single dollar earned in Jamaica is going towards debt repayment.   It’s debt to GDP ratio is ranked the world’s 4th highest at 132 per cent.  

It seems like Jamaica owes people from everywhere – including the football association.

The fact that Jamaica is relying on countries and other bodies to suspend debt repayments signals to me that finances have never been properly looked after, can they ever break this habit of a lifetime ?

G20 – what number is Jamaica?

Probably very low down on the list of priorities (if indeed it is on the list at all) when it comes to the discussions between the 20 richest nations leaders, going on in London, is poor Jamaica.

It hasn’t stopped Jamaica’s Finance Minister Audley Shaw from trying. 

He’s been going cap in hand with his weak voice, asking for help from the inter American Development Bank. 

He has been saying that Jamaica needs more money “urgently” for investment in infrastructure and to replace all the jobs that have been lost recently in the bauxite industry and elsewhere.

He said it was essential “to put in place economic stimulus packages for small, heavily indebted, and highly vulnerable economies like Jamaica  “

I’ve been trying to blog about the vulnerability of JA’s economy here for some time, and this is the first time I’ve heard that a senior govt voice has spelled it out clearly like this.

Asking for loans on top of the debt already crippling Jamaica is probably the only thing that can be done right now.  So good luck to Mr Audley Shaw, but according to this article, he doesn’t instil much sense of hope.