2016年-IMF国际货币组织全球_Jamaica_Thirteenth_Review_under_the_Arrangement_Under_the_Extended_Fund_Facility_69页_1mb

Summary of the Thirteenth Review Under the Extended Fund Facility (EFF) for Jamaica

Core Content

The International Monetary Fund (IMF) completed the Thirteenth Review under Jamaica's Extended Fund Facility (EFF) arrangement on September 16, 2016, and approved a US$39.6 million disbursement. The review was conducted via lapse-of-time procedures without a formal meeting, following discussions with Jamaican officials from August 9 to 19, 2016. The program has been implemented effectively, meeting all quantitative performance criteria and structural benchmarks for end-June 2016.

Main Views and Key Information

Economic Performance

• Growth Outlook: Real GDP growth for FY15/16 was 1%, slightly above expectations. Growth is projected to reach 1.7% in FY16/17, supported by agricultural recovery, strong tourism, and increased FDI.
• Inflation: Headline CPI inflation was 2.5% in June 2016, but is expected to rise to 5.2% by March 2017 due to rising oil prices.
• Unemployment: Remains high at 13.7% in April 2016, reflecting weak economic activity and increased labor force participation.
• Poverty Rate: Approximately 20% of the population is in poverty.
• Exchange Rate: The J$/US$ exchange rate depreciated by 5% in 2016, and the real effective exchange rate by 7%.
• Net International Reserves (NIR): Reached US$2.4 billion at end-July 2016, nearly US$500 million above the program target.

Program Implementation

• Quantitative Performance Criteria (QPCs): All QPCs were met, including primary balance, tax revenues, public sector balance, and social spending.
• Fiscal Targets:
  • Primary balance of the central government: Met (actual: J$26.8 billion, target: J$11.0 billion).
  • Tax revenues: Met (actual: J$108.3 billion, target: J$99.0 billion).
  • Social spending: Met (actual: J$7.6 billion, target: J$4.8 billion).
• Monetary Targets:
  • Net international reserves: Met (actual: +J$285.6 billion, target: -J$199.6 billion).
  • Net domestic assets: Met (actual: -J$20.9 billion, target: +J$28.7 billion).

Structural Reforms

• Tax Reforms:
  • A two-phase tax reform aims to shift from direct to indirect taxes, increasing PIT exemption thresholds and marginal tax rates.
  • Phase I was completed in July 2016, with Phase II to be finalized by end-2016.
  • Property tax reforms are underway, with new rates and bands to be submitted to Cabinet by end-December 2016.
• Public Sector Transformation:
  • The wage-to-GDP ratio is targeted to fall to 9% by end-FY18/19.
  • A new fiscal responsibility law has been introduced to guide wage management and enhance transparency and accountability.
  • A human resources software (HCMES) is being rolled out to 14 MDAs with IDB support.
• Social Safety Net:
  • PATH (Public Assistance to the Poor and Vulnerable) is the main social program, but coverage and benefit levels need improvement.
  • Only 58% of the bottom decile receives PATH benefits, and 10% of disabled individuals are covered.
  • The program should expand coverage and increase benefit levels to enhance social protection.

Monetary and Financial Sector Policies

• Monetary Policy: The BoJ lowered the policy rate by 25 bps in May 2016, with a cumulative reduction of 75 bps since April 2015.
• Interest Rate Pass-Through: Lending rates have not fully reflected the rate cuts due to high spreads and weak competition.
• Financial Sector Resilience:
  • Non-performing loans (NPLs) are declining, reaching 3.5% of total loans.
  • Dollarization trends continue, but efforts are underway to reverse this.
  • Prudential reforms for the retail repo industry are being strengthened, including capital requirements, stress tests, and liquidity ratios.
• FX Management:
  • The BoJ is working to introduce market-based FX auctions to reduce dollarization.
  • FX reserves are expected to reach 85% of the IMF's reserve adequacy metric by end-2016, still below the recommended range.

Risks and Challenges

• Growth and Job Creation: Continued growth dividends and job creation are essential to sustain social support for reforms.
• Zika Virus: Could negatively impact tourism.
• Crime and Violence: May deter investment and strain social fabric.
• Fiscal Sustainability: Uncertainty in tax reform revenues and insufficient wage bill control pose risks.
• Brexit Impact: May reduce UK tourist and remittance inflows, though impact is likely modest.
• Reform Fatigue: The fourth year of the program brings challenges in maintaining public support.

Conclusion

The IMF Executive Board concluded the thirteenth review with positive outcomes, recognizing Jamaica's strong program implementation and improving economic indicators. However, sustaining growth, enhancing social protection, and reducing dollarization remain critical priorities. The reforms in taxation, public sector efficiency, and financial inclusion are seen as key to long-term economic stability and growth.

Supporting Documents

• Letter of Intent and Memorandum of Economic and Financial Policies are included in the staff report.
• Technical Memorandum of Understanding outlines the program conditions and reforms.
• Boxes and Tables provide detailed analysis on inflation, FX trends, tax yields, and program performance.

Final Notes

• The IMF's transparency policy allows for the deletion of market-sensitive information.
• The price of the report is US$18.00 per printed copy.
• The report is available through the IMF Publication Services.