WASHINGTON, (CMC) – The International Monetary Fund (IMF) Wednesday approved a disbursement of US$39.7 million for Jamaica under its executive board had completed the ninth review of the island’s economic performance under the multi-million dollar Extended Fund Facility (EFF) arrangement.

The Washington-based financial institution said that it remains “firmly committed to the economic programme supported by the Extended Fund Facility” and that Jamaica’s performance is on track and structural reforms have progressed broadly on schedule.

Jamaica in 2013 entered into a four-year US$932.3 million EFF arrangement and the IMF said the completion of the review enables an immediate disbursement of US$39.7 million.

IMF Deputy Managing Director, Min Zhu, said “macroeconomic fundamentals continue to strengthen and that inflation is at a historical low and the current account is improving, aided by declining oil prices.

“The recent upgrade in the credit ratings followed by the large international bond placement signaled improved investor confidence in Jamaica’s reform programme.”

But he warned that “growth remains weak and unemployment needs to decrease further.

“Sustained efforts in structural reforms, including by reducing energy costs, improving the business environment, and developing critical infrastructure, should help boost investment and growth.”

The IMF official said that the recent Petrocaribe debt buyback has lowered the ratio of public debt to gross domestic product (GDP), which the ongoing fiscal consolidation should maintain firmly on a downward path.

“Nonetheless, it is essential to move forward with public sector reforms, including as regards public financial management, to improve the efficiency of government services. It is also important to continue strengthening fiscal revenue by reforming customs and tax administration and broadening the tax base.”

The IMF said that recent steps to loosen the monetary stance should support credit creation, while maintaining price stability.

“ The completion of the transition of the retail repo contracts to a trust-based framework represents a milestone in buttressing financial sector stability,” the IMG Deputy Managing Director said.