WHAT A contrast in reports from the International Monetary Fund (IMF) as they relate to two of the Caribbean Community’s major economies — Jamaica and Guyana. In the case of Jamaica, both the IMF and that country’s Central Bank have found it necessary to revise their assessments of the performance of the national economy, with sections of the local media reporting on “grim days” ahead with expected “negative growth.”
By comparison, the IMF mission to Guyana has underscored “robust growth” in its report on this nation’s economy.
In drawing attention to the contrasting economic situations, there is no cause for gloating, given the vagaries of economic fortunes for small and medium economies in our Community that remain vulnerable to external factors and natural disasters.
Both Jamaica and Guyana have been affected, at different periods, by external shocks and varying natural disasters. The World Bank and IMF have had cause previously to allude to such occurrences in their respective reports.
Nevertheless, it must be encouraging for the administration of President Bharrat Jagdeo, the private sector, civil society organisations and, of course the Guyanese people as a whole, to learn from the IMF of Guyana’s “robust growth” performance.
As reported in our yesterday’s edition, in projecting overall economic growth at just under four per cent for this year, the IMF has noted that despite external and domestic economic shocks in 2010, the national economy has succeeded in recording a fifth consecutive year of “robust growth.”
On the other hand, Jamaica, which had good reason earlier to rejoice in arriving last January at an agreement with the IMF for a US$1.02 Billion loan, was to learn of a downgrading of the country’s anticipated economic growth of 0.5 per cent to 0.1 per cent. Basically, negative growth.
The original expectation of 0.5 per cent, as indicated by the Bank of Jamaica, was prior to the battering unleashed by tropical storm ‘Nicole’. But in its own assessment, the IMF included not only the negative effects of ‘Nicole’, but also pointed to “lower than expected growth” in some of the country’s major (external) trading partners, and civil unrest.
Ironically, Jamaica’s downgrading to negative growth has followed Prime Minister Bruce Golding government’s encouraging success in meeting all of the IMF’s stated end-of-September “performance targets.”
One of the very worrying aspects of Jamaica’s socio-economic problems is the lingering high level of poverty, which increased from almost ten per cent in 2007 to over sixteen per cent (16.05%) last year, amid fears of a further hike by year end.
It is incumbent upon CARICOM member states to constantly keep under review how best they should cooperate among themselves to maximise economic gains to stimulate growth, and strengthen the process of regional integration to benefit citizens of our Community.