brian wynter : the year ahead – the view from the bank address by mr brian wynter, governor of the bank of jamaica, to the american chamber of commerce ( amcham ) forum, kingston, 25 march 2011. * * * ladies and gentlemen : for as long as most of us can remember, jamaica has been hamstrung by persistent macroeconomic problems. they are well - known but they bear repetition : low gdp growth, adverse fiscal and debt dynamics and the related unsustainable imbalances. these problems were exacerbated by the global economic and financial crises which commenced in 2008. in order to break this cycle, the country took some bold steps in 2010 which have so far resulted in successes in key performance indicators. in january 2010, the government successfully negotiated the jamaica debt exchange ( “ jdx ” ) with local investors resulting in an astonishing rate of participation. this paved the way for the signing of a stand - by arrangement with the international monetary fund ( “ imfsba ” ) which entailed jamaica giving a commitment to an economic path and a set of reforms that would establish and maintain the fundamentals that are conducive to sustainable growth and development. the key objectives of the resulting medium - term programme are to set jamaica ’ s debt to gdp ratio on a downward trajectory, entrench fiscal discipline and accountability and raise the growth rate of real gdp. in this context, monetary policy is aimed at bringing inflation down to mid - single digit levels and maintaining it there for the mediumterm in the context of a flexible exchange rate. these commitments enabled the government to access unprecedented levels of funding from the multilateral financial institutions. a combined total of us $ 2. 4 billion, amounting to about 20 per cent of gdp, is expected to be received by jamaica over the programme ’ s twoyear period to provide budgetary support and meet balance of payments needs. so, what is the progress to date? well, so far we have seen the materialisation of a number of the goals envisioned by the medium - term programme. it was envisioned that the fiscal policy strategy and the resulting stable medium - term outlook would create the conditions for substantial and sustained reductions in interest rates. this would be achieved by consolidating public finances which would set the stage for lower deficits and progressively lower financing needs. and, indeed, this has been the result. for fiscal year 2011 / 12, we are expecting that the process of fiscal

brian wynter : stability, interest rates and economic growth address by mr brian wynter, governor of the bank of jamaica, to the institute of chartered accountants ’ forum, kingston, 5 october 2011. * * * ladies and gentlemen : thank you for inviting me to participate in this forum and to speak on the important issue of “ stability, interest rates and growth ”. the topic is timely in light of jamaica ’ s economic history and the global financial crisis in 2008 and 2009 which is still hurting many economies, including jamaica ’ s. that crisis also resulted in the broadening of the mandate of many central banks to include an increasing role in facilitating sustainable growth and fostering overall financial system stability while focussing on the primary objective of price stability. in this regard, i will speak first to jamaica ’ s experience with growth, inflation and interest rates over the past decade and then discuss the way forward. the jamaican experience the global recession during 2008 and 2009exposed the vulnerabilities in the jamaican economy and contributed to contractions in domestic output of 3. 0 per cent and 1. 2 per cent in 2009 and 2010, respectively. however, while the performance in these two years was primarily the result of the global recession, economic growth before that was relatively modest, averaging 1. 5 per cent per year over the previous eight years. the performance over that period was significantly weaker than that of our caribbean neighbours and other emerging market economies, despite our relatively high rates of investment. in this regard, a number of studies have been undertaken to explain the paradox of high investment and low growth in the jamaican economy. they all concluded that jamaica ’ s weak growth performance has been due largely to low productivity. this low productivity is in turn linked to under - investment in social capital given the high levels of public debt obligations. concurrently, over the period 2001 – 2010, jamaica ’ s annual inflation averaged 12. 0 per cent, well above that of our major trading partners. this partly reflected the country ’ s vulnerability to external and domestic shocks, including the impact of fiscal expansion and debt accumulation. the economy has been particularly vulnerable to periodic episodes of financial market and economic instability, given the persistence of large fiscal and current account deficits, in other words, the twin - deficit problem. unsustainable public debt levels as well as the large fiscal and current account deficits contributed to bouts of exchange rate instability which impacted inflation and interest rates. this instability biased private investment decisions towards short - term,