Categorized | National News

IMF Conducts Mission On Economy

Officials of the International Monetary Fund (IMF) are in town analysing the country’s economy in hopes of making suggestions on how to revive its finances.

Head of IMF Gene Leon, along with five others, began their mission yesterday with a courtesy call on Prime Minister Perry Christie and Ministry of Finance officials.

The nation’s chief briefed the group on the dynamics of the country’s economy and the Christie administration’s plan to reduce the deficit and create more revenue.

Over the next two weeks, IMF officials are expected to meet with other government officials, the official Opposition and heavy-hitters in the private sector.

State Minister for Finance Michael Halkitis said most of the things done yesterday were preliminary.

“They will make some observations on the current state and they will give some suggestions on what we could do and as the practice over the last few years, it will be published,” he said.

“So what they are doing is giving us a set of eyes from the outside so that we can have an objective view of our current situation, give an opinion of the government’s plans and any advice that they think that we can use.”

Last year, IMF officials warned that higher spending on new government initiatives were expected to widen the central government deficit to about 5.25 per cent of GDP and raise central government debt to over 50 per cent of GDP in the fiscal year 2011/12.

Officials said additional risks to the fiscal outlook arose from the continued weak performance of the non-financial public enterprises.

“Going forward, the authorities intend to take fiscal measures to stabilise and reduce the debt-to-GDP ratio and support the economic recovery, while maintaining price and exchange rate stability,” the IMF said at the time.

“They also plan to reform and enhance tax administration, increase fiscal responsibility, and improve transparency for public enterprises. Global developments, including high oil prices, pose risks to the outlook, but upside potential could offset these if projects under consideration materialise. The mission is confident that the determined pursuit of fiscal consolidation and an enabling investment climate will improve the macroeconomic environment and support sustained economic growth.”

Minister Halkitis said he is not expecting that the IMF will give advice that is not already being adhered to.

“IMF said in its recent report that not only should countries be looking to cut their expenses and implement a sturdy programme, but they have to put some emphasis on growing the economy as well, which we agree with and what we are trying to do with some of the foreign direct investment projects,” he said.

“Our plan is to take a balanced approach and restoring the health of the country and we think that over the next few years we will be able to do it.”

The IMF is an organisation of 188 countries, working to foster global monetary cooperation, secure financial stability, facilitate international trade, promote high employment and sustainable economic growth and reduce poverty around the world.

Kendea Smith

Written by Kendea Smith

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