KINGSTON, Jamaica: The latest data showed that the economy grew by 2.1 per cent in the second quarter, Prime Minister Bruce Golding said in a statement Friday. This is well above the government’s projected 1.5 per cent.
Golding said the growth shows that the economic recovery is continuing.
The Prime Minister welcomed the growth and said the government had to ensure that the gains made in fiscal management continue to support Jamaica’s economic program as represented in the Standby Agreement with the International Monetary Fund (IMF).
“While the performance for this fiscal year is broadly on track, there are challenges that must be addressed in order to achieve our medium term targets through 2015/2016. Principal among these is the provision that must be made for payment of the seven per cent increase granted to public sector workers inclusive of the arrears covering the period 2009-2011,” Golding said.
He noted that certain tax policy initiatives are also crucial to the success of the program. These include tax reform aimed at widening the tax base and eliminating anomalies in the tax system. The tax reform program which his administration has undertaken is another essential component that the Prime Minister described as critical.
“An essential component of the tax reform program is the reduction of discretionary waivers which deprive the government of revenue vitally needed to contain and eliminate the fiscal deficit,” Golding said.
He added that the completion of the divestment of the government’s shares in Clarendon Alumina Production is another significant requirement of the program and disclosed that negotiations are in their final stage and the negotiating team is expected to return to Jamaica this weekend with a draft agreement.
Golding also explained that other challenges to be addressed include making provisions for legacy payments resulting from arbitration or judicial awards relating to Cricket World Cup, construction of the North Coast Highway and the revocation of the Jamaica Urban Transit Company bus franchise.