Prime Minister Bruce Golding has ended his visit to the US Capital, Washington D.C, with a commitment from the Inter-American Development Bank (IDB) to provide a US$50-million infrastructure and rehabilitation loan.
The funds will enable the government to undertake critical repairs following the damage caused by Tropical Storm Gustav. The loan agreement is expected to be signed in Washington within the next few weeks, by Finance Minister Audley Shaw.
The IDB loan agreement was reached when Prime Minister Golding met Monday (Sept 29) with the President of the IDB, Luis Alberto Moreno at the IDB Headquarters downtown Washington DC.
Mr. Golding said the IDB has given an explicit commitment to working towards a positive net flow of resources to Jamaica. To achieve this objective, the IDB will seek lending approvals ranging between US$100 to US$200 million per year over the next three years. This will be aligned with the pace at which Jamaica implements it own set of policy reforms in the areas of taxation, public sector, and private sector development.
On Tuesday afternoon, (Sept 30) Mr Golding also held extensive high level discussions with the President of the World Bank, Robert Zoellick, at the Bank’s headquarters.
The talks with both banks focused on Jamaica’s portfolios and general relationships. Discussions covered the current turmoil in the global financial market, the dramatic increases in oil and commodity prices and their effect on the Jamaican economy.
Mr. Golding sought assurances on the role the Banks could play in helping the country during this difficult period. He noted that the decision of the new administration to engage the Multilateral Institutions more intensely during the last year, had been timely given the present fall out in the financial markets and the difficulty that Jamaica might encounter in accessing the global market.
The Banks assured the Prime Minister of their willingness to increase their support for Jamaica along three broad paths: expanding social, welfare and anti-poverty programmes, expanding the supply side of the economy by focusing on infrastructure, energy and agriculture and providing greater access to liquidity by expanding budgetary support via policy based loans.
Both the World Bank and the IDB have given firm commitments to expanding Jamaica’s portfolio of projects in critical development areas and very importantly to provide technical support to iron out any implementation difficulties.
The IDB and World Bank discussions also focused on some specific development challenges faced by Jamaica. These include crime, the impact of climate change and the limitations posed by the country’s high debt stock. The World Bank undertook to work with the Jamaican authorities in addressing these issues.
Discussions were also held on the frequency of weather related disasters and the inadequacies of the Catastrophic Risk Insurance Scheme. The World Bank has already commenced an evaluation of these arrangements with a view to offering more accessible insurance coverage.
The Prime Minister is scheduled to return to the island on Thursday, October 2.(JIS)
