THE OFFER OF A $2.7 BILLION aid package from the United Kingdom to be spread over three years has raised some concerns from the Minister of Finance and Planning, Dr. Omar Davies. He has objected to the fact that the aid package is to be tied to economic performance which is his responsibility. It is his job to ensure that Jamaica meets the targets which he himself sets as the markers of good financial management.
The minister is obviously concerned that the main condition of the aid is that the country should achieve its macro-economic targets which it has not consistently done. At the formal launching ceremony last week he said there needed to be greater consistency between government departments of donor countries linked to the provision of foreign assistance.
The problem, he finds, is that the failure to attain targets by a recipient country can result in the failure to provide the aid. Proposed programmes to boost community safety and battle HIV/AIDS would be stalled.
But the British have been influenced by a new doctrine in providing overseas assistance. They want to reward good economic management with development assistance. The old concept of throwing money at poor countries has not worked. Most poor countries have stayed poor when foreign donors supported specific projects in countries without taking into consideration the often poverty engendering ways of host countries. No longer. Bureaucrats from the United Kingdom Foreign Office are showing us both a substantial carrot and an equally imposing stick with the goal of urging us onto the path of fiscal rectitude.
In addressing Dr. Davies' concern that Jamaica would not get the money if he did not achieve his goals, the head of their Department for International Development, Sandra Pepera, said that her organisation, which coordinates the funding, was both coherent and consistent in its policy approaches to individual countries.
Of concern to the average Jamaican in this interchange is that fiscal failure would result in Jamaica getting only a fraction of that $2.7 billion it so desperately needs now. But we believe there are bigger concerns at stake.
One of the reasons Jamaica desperately needs that cash now is that the Government needs to improve its revenue collection system as well as the management of its spending. With general elections due within two years, the three-year British aid package would serve as a useful mechanism for encouraging fiscal stability.
Ultimately, we think the British conditionality should spur the resolve to attain the key macroeconomic targets that are crucial to meeting the targets so urgently needed at this time.
THE OPINIONS ON THIS PAGE, EXCEPT FOR THE ABOVE, DO NOT NECESSARILY REFLECT THE VIEWS OF THE GLEANER.
