Jamaica is on track to meet the December 2017 quantitative and indicative targets under the Precautionary Standby Arrangement (PSBA) with the International Monetary Fund (IMF), the Economic Programme Oversight Committee (EPOC) has informed.
Tax Revenues & Grant
Fiscal year-to-date tax revenues at end-October 2017 were at $271.9 billion which exceeded the budgeted target of $260.3B billion
The Ministry of Finance and the Public Service (MOFPS), notes, however, that for the month of October 2017, Revenues and Grants were behind budget by $2.9 billion. This significant shortfall relates to expected flows programmed in the budget that were to come in from the three public entities which were incorporated into the budget. These flows are expected to come into the Consolidated Fund at a later date.
Expenditure for the first seven months of the fiscal year (April-October) was $7.2 billion below the GOJ budget (-2.2%). Of this amount, recurrent expenditure was $7.0B below budget while capital expenditure was $0.2B below budget (-0.7%).
As a result of the Revenue and Grants performance and the under-expenditure for the first seven months of the fiscal year, the Primary Balance of $65.5 billion exceeded the $48.7B budget target for April-October 2017.
The Non-Borrowed International Reserves at the end of October was US$2.38B against the programme target of US$1.78B for end December 2017. The Bank of Jamaica anticipates that this positive performance will continue through the end of December 2017.
The fiscal year to date inflation was recorded at 4.7 percent, within the Bank of Jamaica’s target of 4.0% to 6.0% percent.
The 2017/2018 First Supplementary budget was tabled on December 5, 2017 and shows a total Revised Estimates of $805.5 billion, compared with the Original Approved Estimates of $715.6 billion. The Revised Expenditures were calibrated within the fiscal space afforded by the Revised Estimates for Revenues and Grants which generates a Primary Balance of $132.3 billion. Accordingly, the Primary Balance requirement of seven per cent of GDP is satisfied by this revised profile for the fiscal operations.
Jamaica continues to meet its macro fiscal targets. Inflation at 4.7% is stable and within the targeted range. Interest rates are trending downwards and Non-borrowed reserves of US$2,377 million remain strong and will exceed the December programme target. Tax revenues continue to be buoyant which has given the GOJ the opportunity to table a supplemental budget increasing spending in the key areas such as national security, infrastructure and tourism. The PIOJ projects growth to be in the range of 1.5%-2.5% for the October to December quarter.
The Call For a New Style EPOC
There have been calls from Leaders in Civil Society and from the Media for a stronger independent body to be put in place and possibly entrenched in legislation to provide oversight over Jamaica’s Programme for Economic and Social Affairs. EPOC believes this discussion is an important one to have as Jamaica builds to protect the gains that all have sacrificed for and to ensure the continuity of oversight as we all work for a stronger and resilient economy.
EPOC is committed to continue in its role of monitoring the macro fiscal programme of the GOJ ensuring independent reporting on the progress in these areas.
It was also noted that there are ongoing efforts to establish the autonomy of the Bank of Jamaica and to strengthen the capacity of Parliament for fiscal and budgetary analysis. This Institutional framework will provide even greater independence and critical review of important monetary and fiscal targets. EPOC will continue to monitor developments in these areas.
EPOC will continue to utilize all existing channels implemented for sharing of information such as: monthly report submissions in the print media, quarterly press briefings and interviews, digital engagement via our social media channels and through community engagement sessions.
Source/Loop News Jamaica