Dionne Rose, Staff Reporter
Finance and Planning Minister Dr. Omar Davies speaks during the close of the 2006/2007 Budget Debate in Gordon House yesterday. In background is Dr. Donald Rhodd, Minister of State in the Ministry of National Security. - RUDOLPH BROWN/CHIEF PHOTOGRAPHER
MINISTER OF Finance and Planning, Dr. Omar Davies, yesterday rejected the majority of the proposals put forward in the 2006/2007 Budget Debate by Opposition Spokesman on Finance, Audley Shaw, on how to address the nation's debt problems.
Dr. Davies said, while closing the Budget Debate in Parliament, that the Opposition Finance Spokesman's plan to pay off expensive debt with funds borrowed under the PetroCaribe Initiative could not be done.
Mr. Shaw had proposed to use the multi-billion dollar PetroCaribe Fund to retire expensive debt with longer-term low cost debt. However, Dr. Davies said that under the PetroCaribe Agreement the fund could not be used for external debts.
OTHER PLANS
The Finance Minister said the Government had other plans for the use of the funds, which are more in line with the agreement. Among those plans, he said, were the reconstruction of the country's hurricane-ravaged infrastructure, access to funding for energy projects and for projects aimed at stimulating economic expansion.
On Mr. Shaw's proposal to borrow against Govern-ment of Jamaica (GoJ) inflows, denominated or linked to foreign currency, the Finance Minister said it could not be done.
"There is nothing wrong with this proposal, but it is not new. The fact is the only major inflows over which the Government has control are those related to bauxite/alumina and these have been used to securitise loans to facilitate the Government's ownership in that sector," he said.
On a third proposal made by Mr. Shaw, to borrow a block of funds from a consortium of multinational institutions, including the Inter-American Development Bank and Caribbean Development Bank, he again said the plan was unrealistic.
Dr. Davies also dismissed claims by Mr. Shaw that the country's total debt by the end of the fiscal year would reach $1 trillion.
