Jamaica seeking to access US$1.7 billion from the IMF

Jamaica has reached a staff-level agreement with the International Monetary Fund (IMF) for access to US$1.7 billion through two of the multilateral's instruments.

The request for funds from the Precautionary and Liquidity Line (PLL) and the Resilience and Sustainability Facility (RSF) is to be considered by the IMF's Executive Board in early 2023.

The IMF said in a media release that the PLL will provide valuable insurance to the country against downside risks, including those that arise from extreme weather events.

The RSF will help support Jamaica's agenda to increase resilience to the effects of climate change, transition to a zero-carbon economy, and catalyse official and private climate-related financing.

In a series of videos posted to Twitter, Finance Minister Dr Nigel Clarke explained that although the Jamaican economy is on track to reach pre-covid levels in 2023, there are risks, including the need to refinance some of the country's loans, which could attract high interest rates.

He said the facilities from the IMF would provide funds at a much lower interest rate.

"This is a compelling instrument, that if we access, would not only support our climate  resilience building strategy, but also potentially save Jamaica approximately $35 million per year over 20 years in interest costs, as against accessing financing in capital markets," Clarke explained in relation to the RSF.

"Jamaica must take advantage of this opportunity," he stated.

Turning to the PLL, Clarke said the instrument was designed for countries with strong economic fundamentals.

"Jamaica's qualification for this credit line is a signal of our economic strength and stability," Clarke opined.

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