Kingston, Jamaica, July 22, 2017 - Following their monthly meeting on July 17, the Economic Programme Oversight Committee (EPOC) reports that Jamaica has met all structural benchmarks under the Precautionary Standby Arrangement with the International Monetary Fund (IMF) as of the end of June, 2017.
EPOC notes that an IMF team will be on the island by September 2017 to conduct its semi-annual review, based on the June performance criteria. EPOC expects this review to reflect a positive outcome for Jamaica, based on the performance of selected fiscal and monetary criteria up to May 2017 and the successful completion of structural benchmarks through June 2017.
EPOC reports that the Government of Jamaica (GOJ) has met the eight (8) structural benchmarks for public sector transformation, public bodies and public service reform through the end of June. These include the benchmark for public bodies to submit all legislative changes to Parliament by June 15, 2017, directing all earmarked revenues from the Civil Aviation Authority, the Tourism Enhancement Fund and the CHASE Fund to the Consolidated Fund.
Upcoming benchmarks to be submitted to Cabinet are a proposal for the crisis resolution framework by July 31, 2017, as well as a proposal to revise the Bank of Jamaica Act in line with IMF recommendations by August 31, 2017.
Revenue performance remains encouraging, the report notes, with tax revenue intakes of J$68.6 billion in April and May equaling the budgeted target. An 8.1 per cent over performance of Revenue and Grants (which totalled J$76.2 billion) was driven primarily by a one-off public distribution of J$3.1 billion. As a result of this performance, the Committee expresses its confidence in sustainability throughout the fiscal year.
EPOC’s July Communiqué notes Recurrent Expenditure for the first two months of the fiscal year falling below budget by J$1.1 billion. Capital expenditure fell by J$800 million – 27.7 per cent below budget.
“We encourage the GOJ to keep capital expenses in line with budget for the rest of the fiscal year, given its importance as one of the main drivers of economic growth,” the Committee states in its July report.
Strong Primary Surplus
As a result of the Revenues and Expenditure reports, EPOC points to a Primary Balance of J$15.5 billion, exceeding the budget target of J$8.2 billion for April and May.
“We are encouraged by the performance of this significant fiscal metric, signalling continued fiscal discipline by the GOJ," the Committee comments in its July report.