Chang PRESIDENT OF the Jamaica Chamber of Commerce (JCC), Anthony Chang said that though the JCC is pleased with the recent positive assessment of the Jamaican economy given by the International Monetary Fund (IMF), under the Staff Monitored Programme(SMP), there was a need to publish the report as quickly as possible.
Speaking at the JCC's monthly board meeting last week, Mr. Chang called for the expeditious publication of the IMF report so that the local business community can conduct a critical assessment of the data.
At the board meeting Mr. Chang said: "A higher level of transparency on economic matters is evident, in keeping with the public disclosure of the SMP last year, this is a step in the right direction and the Ministry of Finance should be applauded on this move."
In its preliminary message, the IMF notes that it is satisfied with the general direction of the Jamaican economy, although it appears that the Government will miss its self-imposed interest rates targets.
Nevertheless, Mr. Chang sees this as no reason why the fiscal targets cannot be met at year end.
"The missing of the interest rate target will result in an increase in the government's interest expense over what it would have been if the rates were lower as planned. April to December total tax revenues were also below what was budgeted for," added Mr. Chang.
He cautioned the Government against imposing any significant new taxes as a means of financing the budget for the 2001-2002 financial year.
He reminded the board meeting that under the SMP, the Government will have to start paying cash on Financial Sector Adjustment Company (FINSAC) debts. He noted that this was not a bad idea as it will add liquidity to the system but it will require additional re-sources.
Mr. Chang pointed out that the implications of the imposition of a significant tax increase may well have an adverse impact on the economy.
Addressing the monthly board meeting he said: "A hefty tax package may drive more people into the informal sector and Government may collect less, rather than more revenue from these sources.
"The administration should therefore place emphasis on: efficient utilisation of funds, examination of re-scheduling or converting some of its debt, selling more assets, increased compliance or applying a combination of all these options to finance the next budget."
