Changes to IMF Programme Now Possible

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The IMF’s resident representative to Jamaica, Dr. Bert Van Selm, says the Petrocaribe debt buyback is so significant, that it may spark changes to the country’s economic management programme.

An IMF team is due to arrive in the island next week to undertake its ninth review of the programme.

Dr. Van Selm has hinted that the IMF will consider revising some of the strict conditions under the ongoing programme.

And that’s just what the government would want.

Finance Minister Dr. Peter Phillips stated as much when he endorsed the letter from the US Congressional leaders to President Barack Obama, asking him to lobby the IMF to relax the terms for Jamaica.

One of the toughest conditions of the programme has been the high primary surplus target of 7.5 percent of GDP.

The Opposition’s Deputy Spokesperson on Finance, Fayval Williams, recently questioned whether the target would have to be raised, due to the higher interest payments on the double-bond, used to finance the buy back of the Petrocaribe debt.

But Dr. Van Selm says the deal will likely have the opposite effect.

Dr. Van Selm says while the IMF review team will recommend that the Jamaican government stay the course, the programme is by no means rigid.