Jamaica Gleaner / State Minister for finance and the public service, Fayval Williams, yesterday defended the Government’s so-called five-in-four gross domestic product (GDP growth targets during a parliamentary committee meeting as she sought to dismiss concerns over whether there was a disagreement within government in relation to medium-term projections.
Member of Parliament for Kingston East and Port Royal Philip Paulwell wanted head of the Planning Institute of Jamaica (PIOJ) Dr Wayne Henry to “clear up any dissonance in the Government” in relation to its medium-term GDP growth forecast.
The PIOJ’s medium term baseline projection for 2019-2020 is for the economy to grow by 2.5 per cent.
“It is now time for a clear statement to be made. This is just not possible – it’s not going to happen, and just state it up front so that people don’t reach a state of further depression,” said Paulwell in relation to the Economic Growth Council’s five-in-four projection as against the PIOJ’s forecast.
However, Williams indicated that factors that are not in the PIOJ’s numbers at this time such as efforts to curb crime and increasing the competitiveness of the business environment, among others, could make a difference in terms of the Government’s five per cent growth target.
In an obvious swipe at the opposition she said that she found it quite alarming, that an administration under which the economy did not grow or grew very little, for years, was trying to “talk down the five per cent expectations that we are striving to”. Williams added, “I find that incredible.”
“Growth takes time and that is why we have looked at a five-year period,” she said at the Public Administration and Appropriations Committee (PAAC) meeting of Parliament yesterday.
In a quick response, committee chairman Dr Wykeham McNeill said the point made by the minister was “a little unfortunate”, noting that the committee was trying to clarify numbers from the PIOJ.
He said in September 2016, the Director General of the PIOJ Dr Wayne Henry had made projection of 3.2 per cent growth for 2019-20 during a PAAC meeting. He said this year the PIOJ’s number has been revised to 2.3 per cent.
“Obviously, something is going in the wrong direction, which is what we are trying to clarify. Why is it that if we want aspirationally to go to five per cent we seem to be going in the opposite direction?”
Commenting on the issue, Henry said the Government’s five per cent growth projections was said to be “aspirational”.
PIOJ endorses aspirational five in four targets – Henry Director General of the Planning Institute of Jamaica (PIOJ) Dr Wayne Henry said the PIOJ endorsed the aspirational five-in-four growth targets, saying his entity had set out the conditions under which this could take place.
Henry said the PIOJ’s baseline projections in the medium term were within two to three per cent of GDP range. However, he said under certain conditions there can be more robust growth.
He suggested that if the Government was able to curb crime; implement at a faster pace strategic investments that would drive growth and employment and continue reforms of improving the business environment and increasing the competitiveness of the country, the five per cent projections could be achieved.
The PIOJ head also told the committee yesterday that the 0.3 per cent projection in the fiscal policy paper for the first quarter of the 2017/2018 fiscal year was not met. He said the economy contracted by 0.1 per cent for the first quarter.