|An Analysis of the International Monetary Fund in Jamaica |
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The IMF fund conduct its regular multilateral and bilateral surveillance and to provide policy advice and technical assistance to members ex Jamaica, also the Fund can draw on extra resources through standing borrowing arrangements in the event that the crisis continues to spread. Signing the new agreement with the International Monetary Fund (IMF) will affect the country socially and …show more content…
According to the Jamaica gleaner, $325 billion of a total of $561 billion goes for debt servicing. In order to try and solve Jamaica’s debt problem, the government plan to reach an agreement with the International Monetary Fund (IMF) for a two-year Stand-By Agreement (SBA) of $1.2 billion US to address the country’s economic imbalances and put Jamaica on a path of sustainable growth and to resolve the problem of an unsustainable debt position currently at over 130%. With the new agreement with the IMF, the government will have to impose new taxes upon signing of the IMF agreement as a part of the measures to contain expenditure and increase revenue. Upon the increase of these taxes many business organizations will be affected, they will try to reduce their expenditure, thus leading to the layoff of staff in order to maintain the business, these job lost will only lead to the increase in the level of unemployment. For example if interest rate on the electricity increases this has an impact on the manufactories ex J.Wray & Nephew where they will now have to increase prices on their products because of the amount been charged on electricity, and due to the increase in prices consumers will buy less. With this agreement, if the government does not impose new taxes in order to repay the International
| | …show more content…
The IMF fund conduct its regular multilateral and bilateral surveillance and to provide policy advice and technical assistance to members ex Jamaica, also the Fund can draw on extra resources through standing borrowing arrangements in the event that the crisis continues to spread. Signing the new agreement with the International Monetary Fund (IMF) will affect the country socially and …show more content…
According to the Jamaica gleaner, $325 billion of a total of $561 billion goes for debt servicing. In order to try and solve Jamaica’s debt problem, the government plan to reach an agreement with the International Monetary Fund (IMF) for a two-year Stand-By Agreement (SBA) of $1.2 billion US to address the country’s economic imbalances and put Jamaica on a path of sustainable growth and to resolve the problem of an unsustainable debt position currently at over 130%. With the new agreement with the IMF, the government will have to impose new taxes upon signing of the IMF agreement as a part of the measures to contain expenditure and increase revenue. Upon the increase of these taxes many business organizations will be affected, they will try to reduce their expenditure, thus leading to the layoff of staff in order to maintain the business, these job lost will only lead to the increase in the level of unemployment. For example if interest rate on the electricity increases this has an impact on the manufactories ex J.Wray & Nephew where they will now have to increase prices on their products because of the amount been charged on electricity, and due to the increase in prices consumers will buy less. With this agreement, if the government does not impose new taxes in order to repay the International