Fiscal and Debt Sustainability Development Policy Loan

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This development policy loan (DPL) will assist the Jamaica government in improving fiscal and debt sustainability during an on-going and severe global financial crisis by supporting policies for macroeconomic stability and helping to improve the efficiency and effectiveness of public spending and investment decisions. Specifically, the loan will support policy actions in the following areas: i) promoting fiscal sustainability through controlling overall public sector balances, debt generation, and rationalization of Public Bodies, ii) in creasing the efficiency of public financial management and budgeting processes, and iii) reducing distortions and enhancing the efficiency and fairness of the tax system. The Jamaican government is taking important steps to move away from the status quo of low growth, high debt, and economic vulnerability toward a new direction of higher growth and greater stability. Moving away from the status quo under normal conditions is challenging, in the current global crisis it is even more so. It entails politically difficult decisions to change long-standing policies that benefit narrow interests of some organized groups at the cost of better overall economic progress.