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I have attempted in both my opening and closing presentation to lay the facts of our economic situation on the table. I have held back nothing. In response to the request for data on FINSAC, these have been provided and if more information is needed this will be provided too. We have come through a difficult year, in which many predicted, and unfortunately, some seemed to have hoped for, total collapse - collapse of the foreign exchange system, collapse of the financial sector and collapse of the society. We anticipated the actions needed to prevent deterioration and we took it and we succeeded in terms of maintaining stability in the financial sector and in the foreign exchange system. At the same time, we achieved our inflation target. These are by no means ordinary achievements in the face of the difficulties which surfaced in other countries, which had always been held up to us as an example of the way forward. But there have been costs - significant costs. There have been costs related to maintaining a tight monetary policy and there have been costs related to rescuing the financial sector. These costs have impacted on the domestic debt and consequently on debt servicing requirements. These costs have impacted on the level of interest rates and we have frankly admitted that this has hampered private sector confidence and the level of investments. But we persevered. The Leader of the Opposition speaks about a 'clear and present danger" threatening the nation. I too believe that there is a clear past and present danger which does threaten the nation. It is called 'acute negativism" or Jeremiahism, whereby behind every silver lining -one sees a dark cloud. It afflicts too many members of the Opposition. They find it impossible to acknowledge the reduction in inflation or the stable exchange rate system without pointing out the possible negative effects. We fool ourselves if we persist and continue to assert that the only problem with the private sector, is the existence of high interest rates. If we live in a fool's paradise, we will always postpone taking necessary actions to improve efficiency and reduce unit cost. We have announced a clear model for the way forward. We intend to hold our gains in fighting inflation and a stable competitive exchange rate system even as we bring interest rates down in a credible manner. At the same time, we have taken specific actions in critical productive sectors to first stabilize and then to facilitate growth. We have taken actions to facilitate investments and exports by reducing the interest rates charged by the development banks and the EX-IM Bank. We know these actions will bear fruit. We have raised the income tax threshold and extended an amnesty to errant taxpayers. We have agreed to a compromise with the special interest groups on the amendments to the Revenue Administration Act. As regards the long-term savings instrument, I have received many reactions from ' the financial sector with clear suggestions as to minor modifications which would make it more attractive and saleable. We are reflecting on these suggestions and I will make an announcement shortly. The response from others in the financial sector have spoken to the need for us to provide additional incentives for the equities market within the context of a more stable macroeconomic environment. I am already in dialogue with persons in the field and we will be meeting shortly to chart a way forward with all due respect to the tight fiscal situation. The model for social and economic progress which we have outlined, recognizes the critical role to be played by all groups. As regards the workers, unionized or otherwise, we recognize the impact of inflation and devaluation on your standards of living and we have taken a stand to fight inflation and not to use devaluation as the stimulus for profits. However, to the workers, whether in the private or in the public sector, I say you too must play a part. It makes no sense to make demands of your employers which cannot be met. For those in the private sector you will simply drive them out of business or cause them to leave our shores. For those in the public sector, given the fiscal path which I have outlined and which we intend to stick to, exorbitant and unreasonable demands can only lead to widespread lay-offs. As I said in my opening presentation, recent signs on the industrial scene have given me cause for hope and optimism and I am confident that good sense will prevail. The model which I have articulated has provided the platform from which we can begin to invest and grow our way out of our problems. We have been frank and truthful about the cost we have incurred. We have indicated where targets were missed and where there were failures. We have stated clearly that we face a tough year ahead. At no point have we sought to downplay the difficulties. However, we will never support any attempt to overstate the difficulties and further drown the country in negativism. There are those who, for their own selfish reasons, wish to do this to the point where we have national paralysis and despair. This, all well thinking Jamaicans must reject. We are a vibrant, healthy and industrious people who have overcome great odds in the past. The problems we face are far less than those which other people are now facing or which other people, with less resources, have overcome. We can solve our problems if we believe in our ability. If we believe that as a nation we have the capacity. We now need to summon the will to continue the journey. We have been honest about the problems: we have outlined the measures which need to be taken. We have articulated our visions, our objectives, our strategies and the specific measures to address the needs of the most deprived in the society and to stimulate growth. Finally, as 1 said in my opening address, this is not a struggle solely for the Administration. All interest groups, whatever their varying concerns, need to join together and buy into the model. || Previous | Table of Contents ||
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