WASHINGTON, DC, United States — The World Bank board of executive directors last week approved a US$70-million development policy loan to support Jamaica’s efforts to improve the investment climate and sustain fiscal and public financial management.

“We welcome this boost toward the continued improvement of Jamaica’s fiscal management and competitiveness,” a news release from the World Bank quoted Finance and the Public Service Minister Audley Shaw. “Jamaica has made significant strides under the current Stand-By Arrangement, demonstrating our commitment to the macroeconomic, structural and debt sustainability reforms under the arrangement. The Government’s tight fiscal policy and commitment to sound macroeconomic policies have also served to inspire investor confidence, which now stands at an all-time high, amid stronger net foreign direct investment inflows and a steady increase in employment.”

The World Bank release noted that the reforms adopted by the Government since 2013 have succeeded in stabilising the economy and reducing debt.

“Jamaica’s economy is showing signs of a modest growth acceleration. GDP grew by 1.4 per cent in 2016, up from 1.0 per cent in 2015 and 0.7 per cent in 2014,” the release said. “Employment is rising and inflation has dropped to the historically low level of 2.3 per cent in 2016 (period average). The 2016 – 2017 Global Competitiveness index also ranks Jamaica 75th out of 138 countries, a significant improvement from 86th in 2015.”

The release also quoted Tahseen Sayed, World Bank country director for the Caribbean, as saying: “Jamaica’s sustained and strong commitment in implementing an ambitious economic reform programme has led to the country’s positive economic performance. The economic outlook remains favourable and is expected to continue to improve with the authorities staying the course on the reform programme. The World Bank remains Jamaica’s long-standing partner with the new financing aimed at boosting competitiveness and enhancing fiscal sustainability.”

The bank explained that this financing supports efforts to increase economic competitiveness through reforms that make Jamaica’s special economic zones more attractive to investors, reduce customs clearance times, diversify sources of electricity generation, and upgrade building and construction standards. In addition, it will help the Jamaican Government to ensure fiscal sustainability through stronger systems for debt management, fiscal risks assessment, and public investment management, as well as through placing public servants’ pensions on a sound financial basis for the long term.

“This financing builds on the reforms supported under previous Development Policy Loans to Jamaica, and is part of a large package of financial support from the International Monetary Fund (IMF) Stand-By Arrangement, the World Bank and the Inter-American Development Bank (IDB), with the objective of boosting economic growth while maintaining fiscal prudence,” the release stated.

This loan, from the International Bank for Reconstruction and Development to Jamaica, has a final maturity of 25 years, with a five-year grace period.