KINGSTON, Jamaica — The People’s National Party (PNP) is calling for bold action and a different approach to the management of the foreign exchange market, to protect the Jamaican people during the economic crisis of the global pandemic.

The party said the Bank of Jamaica (BOJ) selling rate for the US dollar passed J$150 last week, and despite the BOJ selling US$30 million from the country’s foreign reserves on Tuesday, the Jamaican dollar fell further to $151.27 to US$1 yesterday.

According to the PNP, the Jamaican dollar has depreciated by over 14 per cent since the beginning of this year, and the country’s foreign reserves have fallen by over US$400 million since March this year.

This devaluation has added approximately $150 billion to the public debt, increasing the cost to the budget of servicing the foreign debt, the party said. It added that remittance flows are likely to come under pressure with the ongoing deep crisis hitting the US economy (where approximately three-quarters of our remittances come from), with Congress being unable to agree to further fiscal stimulus.

“The devaluation is driving up the prices of goods and services, including transportation, electricity and basic food items, and unleashing a wave of hardship on the population. Social dislocation and crime will become unbearable if we continue on the current road,” the PNP said in a news release.

“Business and consumer confidence surveys have also shown that the uncertain and volatile exchange rate has contributed to the sharp slowdown in economic growth from 1.7 per cent in the first quarter of 2019 to zero per cent in the fourth quarter, further falling into negative growth (-2.3 per cent) in the first quarter of 2020. Businesses cannot plan, so investment is negatively impacted,” it continued.

“The JLP government has said nothing and is doing nothing to respond to this crisis, as they continue with a market-based allocation and pricing mechanism at a time when inflows of foreign currency have been hit badly, especially from the tourism sector. A way must be found to navigate the society through the extreme economic conditions which have emerged,” the party added.

The Opposition said Jamaica needs an emergency economic programme that supports expansion of the productive and export sectors, and ensures that these sectors are prioritised in the allocation of scarce foreign exchange. Agriculture, manufacturing, construction and global services must drive the economy forward, as tourism has collapsed with no sign of rebounding any time soon, it added.

The party noted that local farm production must reduce the massive food import bill, which it says is now running at approximately US$1.2 billion each year, and earn foreign exchange by supplying regional and international markets.

“There is no room for financial profiteering and misallocation of this critical resource at this time,” the party said.