KINGSTON, Jamaica, CMC – The main opposition, the People’s National Party (PNP), has rejected a comment from Prime Minister Andrew Holness, who said that his administration did not inherit a growing economy.
In a statement on Monday, the opposition’s junior shadow minister on Finance, Cleveland Tomlinson, described the prime minister’s comments as baseless and “a clear act of political expediency, lacking in both truth and factual support.”
Meanwhile, Shadow Minister of Finance Julian Robinson recalled that in 2011, “the PNP inherited an economy teetering on the brink of collapse.”
“An economic meltdown seemed inevitable. Major policy missteps, coupled with the collapse of the IMF (International Monetary Fund) Stand-By Agreement in 2010 under the then Jamaica Labour Party (JLP) government, severely damaged international confidence in Jamaica’s economy and severed our access to critical financing that was desperately needed,” Robinson noted.
He added that when the PNP assumed office in 2011, Jamaica’s gross public debt had escalated to 147 percent of GDP from an estimated 115 percent in 2007, placing Jamaica among the most indebted nations globally.
“This increase of over J$650 billion in public debt was accrued during the JLP’s four-year tenure. Under the leadership of Former Prime Minister Portia Simpson Miller and former Finance Minister Dr. Peter Phillips, the PNP reduced the public debt to approximately 120 percent of GDP [gross domestic product] by 2016,” the statement said.
Robinson noted that the economy was declining at the end of 2011, with a growth rate of negative 0.6 percent.
“Notwithstanding substantial government spending cuts to manage the public debt and comply with the IMF Extended Fund Facility (EFF) terms, the PNP managed to turn this around to a growth rate of 1.4 percent by 2016. This growth occurred alongside a significant reduction in the inflation rate, from 7.56 percent inherited from the JLP to 3.68 percent by the end of our term. Upon taking office, the PNP also faced critically low gross foreign reserves of around US$0.9 billion, sufficient for only about six weeks of imports, far below the recommended 12 weeks,” he said.
He added that by the end of the party’s term in 2016, the reserves had significantly improved to nearly US$3 billion, covering a minimum of 20 weeks of imports and reflecting a significantly healthier economic state.
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