Messrs. Strauss-Kahn and Golding courtesy of The International Monetary Fund.

The history IMF’s involvement in Jamaica is a painful one. Past encounters between the IMF and Jamaica have much to teach us, and them. This tortured relationship has been explored in numerous mediums. Aid and Power is quite a good book on the subject. Moreover, if you watch one documentary on Jamaica, make it Life and Debt.

The return to the IMF must be apart of a broader economic restructuring process. This process should address fundamental issues such as our unsustainable debt to GDP ratio and the fact that the public sector wage bill is about one-fifth of our budget. The only way to achieve this is through shared sacrifice. Developing an inclusive and robust ‘social partnership’ can be the vehicle for achieving this shared sacrifice. At the heart of this partnership should be a broad-based working group to develop a reform scenario and specify the policy changes needed to achieve it. Partners in this arrangement make decisions jointly, as opposed to informing each other of decisions after the fact. A review mechanism for assessing the effectiveness of implementation and to receive feedback from partners should also be agreed.

However, for us to pursue this path we must recognise that government alone cannot make these profound changes. The opposition will have to be involved, and committed. The public is also yet to learn about the nature and extent of private sector involvement in preparing our request for assistance from the Fund. To enable such a change, the government would have to change its modus operandi. Whether it is negotiating with unions or the number of cases of swine flu, secrecy and rumors of secrecy, are badly draining the goodwill of the electorate towards Mr. Golding’s government. Continue reading →