Economic Programme Oversight Committee (EPOC) Co-Chairman, Keith Duncan, is hopeful that Government’s future capital expenditure will increase if the buoyancy in tax and other revenue inflows recorded during the 2016/17 fiscal year continues.
Tax revenue inflows totalled $458.3 billion for the period. This was $18.3 billion more than the targeted $440 billion.
Additionally, non-borrowed reserves amounted to $1.936 billion, some $462 million more than the $1.474 billion targeted for the period.
This resulted in the Government generating a primary balance surplus of $135.9 billion for the 2016/17 fiscal year, which ended on March 31. This was $12.9 billion or 7.7 per cent above the minimum seven per cent target of $123 billion.
Speaking at EPOC’s quarterly briefing at the Jamaica Money Market Brokers (JMMB) Group head office in New Kingston on Friday (May 19), Mr. Duncan said Government’s overall expenditure totalled $503.4 billion. This, he noted, was $5 billion below the target of $508.3 billion.
He indicated that capital expenditure from this sum totalled $42 billion, which was $2.8 billion or 6.4 per cent less than budgeted.
Mr. Duncan said while the administration was able to close the gap during the last quarter of 2016/17, “we still lagged behind the budgetary expenditure.”
He emphasized that inadequacies in infrastructure such as drains that result in flooding, as was evident with the torrential rains that have lashed the island over the past several days, could significantly impact Jamaica over the long term.
“We know that capital expenditure is where we really need to increase the spend in order to ensure that we can stimulate growth through this line item,” Mr. Duncan stated
In this regard, he expressed the hope that “if the buoyancy in the tax revenues continues, (then) the capital expenditure that was budgeted (this year) would increase significantly over the next budget (and) we will have even more fiscal space so that we can really invest in the infrastructure and social services in our country.”
[Source: JIS]

Co-chair of  the Economic Programme Oversight Committee (EPOC) Keith Duncan, is warning that Jamaica needs to recover quickly from the recent rains, so that it can keep on its current growth track.

Jamaica has passed all its primary targets following the first International Monetary Fund, IMF, review under the precautionary standby agreement.

Duncan says going into the Hurricane season, if  the damage from the recent rains is not addressed soon, future projections could be affected.

“Inside of the budget for this year, there is a one per cent contingency reserve – one per cent of GDP , that is approximately J$20 billion that is in place that in the event of fall out, in revenue expenditures or any kind of disasters that there is some room in the budget for such situations. But however you have to manage that contingency reserve very prudently because we are now moving into the hurricane season. We have to deal with the infrastructure and fall out as it does impact productivity with the rains that have occurred, so we really have to move Jamaica back to normalcy.”

He also  expressed optimism that the government’s target of  5 per cent growth in Gross Domestic Product (GDP) in 4 years is still achievable.

However, he argues that this depends on whether Jamaica remains focused.

He states that a number of  growth commitments, including the Logistics Hub, would need to be targeted.

“I definitely believe that the target can be achieved if those things are done and if we really focus on strategic projects one being our logistics hub ….. I met with the French economic officer yesterday – there are a lot of French companies      that are involved in logistics in Jamaica and they are very comfortable with the future of a logistics hub in Jamaica,” he said.

[Source: RJR Online]

Jamaica has surpassed its primary balance target for the fiscal year ended March 2017, over-performing by 12.8 billion to end at 135.9 billion.
This was reported by the Economic Programme Oversight Committee (EPOC) on Friday.
EPOC’s co-chairman, Keith Duncan, says that represents about 7.7 per cent of gross domestic product, above the International Monetary Fund’s target of seven per cent.
He says if the trend in the robustness of tax revenues continues there will be increased room for capital spending.
Total expenditure of $503.4 billion fell short of the target by $5 billion, while capital expenditure of $42 billion trails the budget by 6.4 per cent.
Duncan says based on the available information EPOC reviewed at the end of March, Jamaica’s strong fiscal and monetary performance remains strong.
He says non-borrowed Net International Reserves remain comfortably above the target and inflation remains within the targeted range.
Duncan also notes that all indicators suggest the economic programme is on track.
However, he says there is still much to be done to achieve the key programme objectives.
EPOC has also noted the need for public consultation and engagement as it embraced the suggestion by Finance and the Public Service Minister Audley Shaw to consider the re-establishment of a parliamentary tax committee to review the government’s revenue measures before they are announced.
[Source: The Jamaica Gleaner]

Jamaica’s primary balance for fiscal year ended March 2017 has over-performed by $12.8 billion to come in just shy of $140 billion, the Economic Programme Oversight Committee (EPOC) reported on Friday.
That represents about 7.7 per cent of gross domestic product, above the International Monetary Fund’s target of seven per cent, and according to EPOC co-chairman Keith Duncan, “if the trend in the robustness of tax revenues continues there is increased room for capital spending”.
Total expenditure of $503.4 billion fell short of the target by $5 billion, while capital expenditure of $42 billion trails the budget by 6.4 per cent.
Notably, the gap between actual and budgeted capital expenditure became increasingly smaller over the last quarter of fiscal year 2016/17 as the government made some headway into capital spending, Duncan told a press briefing held at his JMMB Haughton Avenue offices on Friday.
The lag behind budget was primarily as a result of the late approval of the 2016/17 budget in May last year instead of March.
“This challenge should no longer be an issue in this fiscal year, 2017/18. We will continue to monitor government expenditure, and in particular capital expenditure given its importance as one of the main drivers of growth,” Duncan said.
 
DRIVING PERFORMANCE
 
He said that based on the available information EPOC reviewed at the end of March, Jamaica’s strong fiscal and monetary performance remains strong. Improved tax compliance, as well as improvements in macroeconomic factors and less than anticipated government expenditure, continue to drive the primary balance performance.
Non-borrowed Net International Reserves remain comfortably above the target and inflation remains within the targeted range.
Duncan said the strong performance towards meeting the quantitative performance criteria and indicative targets for December 2016 to March 2017 under the standby agreement was supported by the successful meeting of the structural benchmarks.
Eight structural benchmarks four macro-fiscal and four for public sector reform have been met. They included the establishment of a financial inclusion council and operationalising the financial system stability committee.
“By all indicators, the economic programme is very much on track. However, there is still much to be done if we are to achieve the key programme objectives,” said Duncan.
EPOC has also noted the need for public consultation and engagement as it embraced the suggestion by Finance and the Public Service Minister Audley Shaw to consider the re-establishment of a parliamentary tax committee to review the government’s revenue measures before they are announced.
[Source: The Jamaica Gleaner]