CO-CHAIR of the Economic Programme Oversight Committee (EPOC) Richard Byles is optimistic that Jamaica will remain in very good shape for the 13th review of the International Monetary Fund (IMF).

Byles, who is also president and chief executive officer of Sagicor Group Ltd, was speaking at the Economic Programme Oversight Committee press briefing at the Sagicor New Kingston headquarters on Friday.

“All the major macro-economic metrics are pointing in the right direction – the primary surplus is being met, the NIR is in excess of 23 weeks of imports, the current deficit and inflation are at all-time lows, business and consumer confidence is high and the debt/GDP is reducing. We expect the IMF staff review of the 13th quarter, which is currently being executed, to conclude with a positive recommendation to the IMF Board.”

“I don’t think an investor would want a cricket pitch that is better rolled than that,” Byles told members of the media. “It’s watered, it’s rolled, it’s perfect for the game and the game is: Let’s get ready for growth.”

He is, however, urging the Government not to become complacent, as the debt to GDP ratio remains twice the acceptable level at 120.2 per cent.

“In this respect real economic growth in excess of the one per cent we have been averaging is necessary. The second challenge is to embark on a public sector transformation programme to reduce the current wage/GDP ratio of 10.3 per cent to nine per cent by 2018/19, a saving of nearly $20 billion which is sorely needed for infrastructure investment.”

Nevertheless, Byles noted that the most immediate challenge is the funding of the reduction in the personal income tax threshold, which is expected to cost an additional $16 billion starting in April 2017, without disrupting the primary surplus generation or investor and consumer confidence with punitive taxes.

He reckons that Jamaica could see some additional taxes next year as the Government attempts to buffer the losses of income from PAYE.

Jamaica more than doubled the IMF primary balance targets of $11 billion, to a recorded $26.8 billion. The country also surpassed targets for Net International Reserves (NIR) for June to reach US$2.28 million.

Meanwhile, revenues and grants for the three-month period of April to June 2016 were ahead of budget by $8.4 billion or 7.9 per cent – largely as a result of tax revenues exceeding budget by $7.9 billion or 7.8 per cent.

Taxes that performed above budget were General Consumption Tax (GCT), up $3.9 billion; company tax, up $1.7 billion; sales consumption tax, up $7 billion, and stamp duty, up $6 billion. Underperformers were tax on interest and travel tax which both declined by $4 billion.

Expenditure for the three-month period was $122.7 billion, or 8.1 per cent lower than budget. Byles noted that recurrent expenditure was $7.2 billion below budget, while capital expenditure was also $3.75 billion lower than budget as a result of lower programme and interest expenditure.