It is only the most partisan tribalist who would scoff or frown at the deal reached by the Government in its buy-back of the PetroCaribe debt from Venezuela. Like the Dominican Republic before it, the Government saw an opportunity to do this transaction and took it. It went to the international capital market and, by way of two Eurobonds, secured the funding it needed. The bonds were heavily oversubscribed.

Like all deals, the PetroCaribe deal is not a perfect one, and no one in their right mind would expect it to be. There have been howls of protest from the Opposition spokespersons on finance that this is a bad deal for Jamaica and that the country is saddled with high interest debts which could have been avoided if the Government had gone, instead, to its multilateral partners instead of the international market. The Opposition leader, himself, unwisely suggested that there was no compelling reason to trouble a debt that was not “troubling anybody”. The minister of finance has since given clarity to the arithmetical dilemma that seems to have seized the deal’s detractors.

We will now have to live with its implications for the immediate and long-term efficacy to the economy. The Opposition will highlight with glee the negative aspects of the deal, but what it will not tell us is that the deal will have a marked impact on the debt-to-GDP ratio. It has been estimated that this ratio will now fall to between 123-126 per cent. This indicates a further downward trajectory of the country’s debt stock. The deal has also heightened the possibility for the rating agencies to bump up Jamaica’s rating, which will put the country in an even more favourable position on the international market as one with which others can do business. The deal is a huge public relations achievement in this regard.

Perhaps more telling, and it is certainly not in the Opposition’s best interest to say so, is the almost impregnable position in which the country has been placed to argue for a reduction in the primary surplus target from 7.5 per cent. There is no doubt that Jamaica is being held up as a poster child for the International Monetary Fund (IMF), having passed eight, and is poised to pass nine, of the tests that the agency has set. With the macroeconomic stability that has been achieved, coupled with the increasing favourable assessment of Jamaica on the international financial markets, it is not even in the best interest of the Fund not to grant an easing of this austerity measure. From time to time, even a wayward child must be praised and encouraged when he does something worthy of praise. I predict that the IMF will relent on this matter if approached.

The country will have a better chance of the Fund doing so than our friends in Congress could ever have asking President Barack Obama to pressure it into submission. If the IMF should relent, the only caveat should be the direction in which this saving is bent. It should insist by further agreement that such savings be directed solely to growth-inducing projects, which should be carefully monitored to ensure the restriction of any appetite by the Government to “run wid it.”

The election season is upon us, but I would not begrudge the People’s National Party (PNP) if it should gain this breathing space so long as the interest of the people of Jamaica is served. I believe Dr Phillips is sufficiently seized of the need to maintain fiscal probity and will resist any attempt at the fiscal irresponsibility reminiscent of a past “run wid it” extravaganza. Under Phillips’ tenure, there is a qualitative moral distinction in his approach to the management of the financial portfolio than has not been the case in the past. The state of the Jamaican economy today can be traced to the performance of the PNP in Government over the 26 of the past 30 years that they have governed the country. It is only “meet and right so to do” that today they should be the ones to correct what has largely been their own mismanagement of the economy. One cannot help seeing a sense of poetic justice in all this. But can even Dr Phillips withstand the tidal wave of demand to loosen the purse strings in the context of the elections soon to be held? We will see.

The PNP Government is anxious — if not desperate — for growth to take place in the economy. For example, it would like to see a pickup in the employment of young people, especially among those who have graduated with degrees and who are finding it difficult to be absorbed in the anaemic job market that prevails. But growth has been elusive for this Government. It believes that high power investments — of the nature of the US$5 billion trumpeted by the minister of industry and commerce, Anthony Hylton — are the way to go. Small projects to generate growth are hardly seen. So, while a great deal of energy is wasted panting after mega projects, people who want to get ahead become frustrated.

I do not believe the government needs an economic czar. Czars are hardly the answers to intractable economic problems. What needs to be done, in the short term, is for the Government to go after small, doable projects in infrastructure, energy, tourism, and agriculture. Where the latter is concerned, the expansion of the agro parks should be an excellent area of interest. These projects would have an immediate catalytic effect on the lives of people, and at least give some hope and inspire some confidence in them that something is being done. If the IMF should give us an ease on the primary surplus target, I fervently hope that we will not squander this on the altars of political expediency. My gut tells me that we would not want to. My brain…

Dr Raulston Nembhard is a priest and social commentator. Send comments to: stead6655@aol.com