Due to the projected gaps in its foreign exchange earnings over this fiscal year as a result of the global economic crisis, the government of Jamaica has been contemplating a lending relationship with the International Monetary Fund (IMF). This has caused much deliberation among Jamaicans, many of whom have had to live through actual experiences with the structural reform policies which Jamaica had to undergo under its previous experiences with the Fund.
The Jamaican economy has suffered for the past decade from a crushing debt burden which arose largely between 1996 and 2003 when the debt peaked at 123 percent of GDP (See Figure). Since then, the relative level of the debt has fluctuated, but remained high. Servicing that debt has siphoned off exactly half the government’s revenue over the same period. Consequently, correspondingly fewer resources have been left over to meet the country’s public service needs and to allow investment in physical and social capital, resulting in pitiful rates of economic growth.