Davies praised by IMF boss

Davies

FIRST DEPUTY Managing Director of the International Monetary Fund (IMF) Stanley Fischer in a farewell dinner after seven years of service in that position named Jamaica's Minister of Finance & Planning Dr. Omar Davies as one of the best Finance Ministers he had encountered during his tenure.

This praise comes for a Minister who has had to deal with the rehabilitation of a finance sector that collapsed precipitating the creation of the Financial Sector Adjustment Company (FINSAC), continued successful forays on the world's capital markets, a gas riot that threaten to destabilise the country, seeing the bauxite and alumina industry having to redefine itself after the departure of Alpart after forty years in Jamaica, constantly having to do a Houdini act in balancing the budget and ensuring that the country doesn't become overwhelmed by a mountain of debt that sees 64 cents in every dollar earmarked for paring down the national debt.

World-renowned economist Milton Keynes once said that the true test of any Finance Minister was not when the economy was performing well but what he does when dealt a bad hand." This epithet may well apply to Dr. Davies.

Addressing guest at the formal dinner Mr. Fisher said: "One of the questions I'm asked most often is how the real world of policy-making differs from the textbooks. I usually reply along the following lines. Much of what one learns in academic life is essential in dealing with the technical problems that come up in the IMF. But a key difference from the textbooks is figuring on how to deal in complicated situations with live human beings: what is driving them, what matters to them, which incentives they will respond to, and how.

"We are sometimes accused of being too soft on borrowing member countries. Perhaps- but this is a co-operative institution, whose members have a right to request assistance. In responding to those requests, I often quote the Ronald Reagan maxim, "Trust but verify", which in the case of the Fund should be "Trust, but use conditionally." Nonetheless, sometimes we need to walk away, because the government we are dealing with is incapable of delivering on the needed policies, sometimes because even if the government may be able to deliver, corruption and governance problems are too severe.

"It is an abiding strength of the IMF that we stand for a particular set of policies, for macroeconomic stability, for integration into the global economy, especially in trade, and for market-oriented domestic policies. Those policies do not just happen. Often we do our job by reinforcing people struggling under enormous pressures to do the right thing. I am deeply aware that it is a lot easier to say what should be done from the safety of Washington than for those who have to implement the policies, deal with the political realities in their countries, and bear the consequences if they make a mistake.

"Who are those people, trying -- on the whole -- to do the right thing for their country? Some of them are here tonight. Let me mention, a very few of the others I have met and dealt with: in Mexico, Guillermo Ortiz; in Brazil, Pedro Malan; in Thailand, former Finance Minister Tarrin; in Indonesia, the legendary Widjojo, who has had more lives than a cat; in Russia, Yegor Gaidar and Antoly Chubais, who understood from the beginning the stakes in the battles they were fighting and who made choices I am glad I have never had to confront; in South Africa, Trevor Manuel; in Hungary, Gyorgy Suranyi and in Jamaica Omar Davies.

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