Some Aspects Of The Economy Of Jamaica

JAMAICA’S ATTAINMENT of independence on August 6, 1962 was of greater significance politically than economically, since the Jamaican authorities had had the responsibility for managing their economic and financial affairs for more than a decade. During this period, national elections were held, cabinets formed, and budgets pre-pared and implemented. The present Prime Minister and Minister of Finance both held the same posts in the Government eight years ago. For many years, the country has had its own national currency (£J 1 = US$2.80). Even the recent introduction of a government central bank does not represent a major departure from the policies and practices of the past. The constitutional provision that the Government cannot borrow without the approval of the Parliament is a carry-over from past legal requirements. Much of the foreign borrowing by the Government before independence took the form of Government of Jamaica securities which were not guaranteed by the U.K. Government.


JAMAICA’S ATTAINMENT of independence on August 6, 1962 was of greater significance politically than economically, since the Jamaican authorities had had the responsibility for managing their economic and financial affairs for more than a decade. During this period, national elections were held, cabinets formed, and budgets pre-pared and implemented. The present Prime Minister and Minister of Finance both held the same posts in the Government eight years ago. For many years, the country has had its own national currency (£J 1 = US$2.80). Even the recent introduction of a government central bank does not represent a major departure from the policies and practices of the past. The constitutional provision that the Government cannot borrow without the approval of the Parliament is a carry-over from past legal requirements. Much of the foreign borrowing by the Government before independence took the form of Government of Jamaica securities which were not guaranteed by the U.K. Government.

JAMAICA’S ATTAINMENT of independence on August 6, 1962 was of greater significance politically than economically, since the Jamaican authorities had had the responsibility for managing their economic and financial affairs for more than a decade. During this period, national elections were held, cabinets formed, and budgets pre-pared and implemented. The present Prime Minister and Minister of Finance both held the same posts in the Government eight years ago. For many years, the country has had its own national currency (£J 1 = US$2.80). Even the recent introduction of a government central bank does not represent a major departure from the policies and practices of the past. The constitutional provision that the Government cannot borrow without the approval of the Parliament is a carry-over from past legal requirements. Much of the foreign borrowing by the Government before independence took the form of Government of Jamaica securities which were not guaranteed by the U.K. Government.

It is worthy of note, therefore, that the past decade has been one of remarkable economic growth in Jamaica. The Government has been implementing a sizable development program which has been financed almost entirely from noninflationary sources. A basic policy agreed upon by both major political parties is that the Jamaican pound should not be weakened through inflationary financing of a budget deficit. In this regard, the authorities recognize that the rapid rate of economic growth of the past decade could not have been achieved without large foreign investments. This experience indicates that the development plan for the coming decade will also depend heavily on foreign financing. The authorities feel that a weakening of the pound through inflationary financing in order to execute some additional government development expenditures would jeopardize the favorable domestic environment and thus discourage the foreign capital on which the country’s over-all development is based.

The Domestic Economy 1

In the period 1953-59, Jamaica had a rate of population growth which averaged more than 2 per cent a year. However, in recent years the increase in the island’s resident population has slowed down because of emigration. Nevertheless, with the present resident population of 1.7 million, the average density of 370 persons per square mile is one of the highest in the Western Hemisphere.

Growth of output since 1953 has been substantial, when viewed on either a total or a per capita basis. Gross domestic product at factor cost in 1961 was estimated at £244 million, more than double the 1953 total of £107 million. After adjustment for price increases during the period, gross domestic product in real terms in 1961 was still nearly twice that in 1953. Per capita domestic product for 1961 was estimated, on a preliminary basis, at £150. With adjustment for price increases, this was 60 per cent higher than per capita domestic product in 1953. Thus, the annual rise in real product per capita averaged about 6 per cent for the period 1953-61. From 1953 through 1957, output expanded at a fast pace, about 9 per cent per capita a year. In 1958 there was a slight decline in per capita domestic product, related both to a temporary slowdown in total output and to an unusually large increase in population. In the period 1959-61, the average annual increase in real product per capita again rose to a favorable level, approximately 4 per cent a year. Preliminary indications suggest that economic growth in 1962 may have been at a somewhat lower rate.

Underlying the rapid growth of output in the period 1954-57 was an investment boom and a substantial rise in exports facilitated by the expanded production capacity of the export industries. Gross domestic investment more than tripled during this four-year period and exports doubled. These increases were closely related to the exploitation of the bauxite resources of the country. Since 1957, gross domestic investment has decreased. Nevertheless, such investment in 1961, estimated at £52 million, was more than three times that in the 1953-54 period and amounted to one fifth of gross national product.

The growth of gross domestic product has been accompanied by remarkable changes in the structure of Jamaica’s economy. Particularly striking have been the expansion of the mining industry and the decline in relative importance of the agricultural, forestry, and fishing sectors. Mining, which had been fairly unimportant before 1953, expanded tremendously during the boom of the mid-1950’s, and since 1957 has maintained its expanded share (9 per cent) of Jamaica’s gross domestic product. On the other hand, the share of total domestic output contributed by the agricultural sector has declined from about one fifth in 1953 to about one eighth in the period since 1957. The product of the banking, insurance, and real estate sector has doubled its share of domestic product during this period, in response to an in-creased demand associated with a higher level of economic activity and an expanding tourist industry. The construction sector also grew between 1953 and 1957, but since then it has tended to decline in relative terms. Throughout the 1953-61 period, the manufacturing industry accounted for 13-14 per cent of Jamaica’s gross domestic product.

Tourism has been important in Jamaica for many years, but its development has been particularly great during the past eight years. In 1960, 227,000 tourists visited Jamaica and spent an estimated £13 million on hotel accommodation, shopping, island transportation, and other items. An estimated £20 million is now invested in tourist facilities, and the industry provides employment for 11,000 persons.

Capital Formation

Gross domestic capital formation rose from an annual average of £17 million in the 1953-54 period to a peak of £57 million in 1957. It continued in excess of £50 million in each of the more recent years, or three times that in 1953-54.

Through 1957 much of the increase in capital formation was in the mining category, when foreign mining companies were investing more than £10 million a year in Jamaica. After 1957 new mining investments fell off sharply and have probably averaged less than £2 million a year since 1959. However, investments in a variety of other fields have increased rapidly and have made up for most of the decline in the mining field. Investments in tourist facilities, residential and nonresidential buildings, textile, cement, and cigarette manufacturing enterprises, transportation media, and public utilities have ail increased substantially since 1956. A $10 million oil refinery is currently under construction; when completed in 1963, it will have a daily capacity of 28,000 barrels. Investments in consumer durable goods (particularly private cars) rose sharply in 1958 and 1959, in association with a rapid increase in hire-purchase credit.

The Government recognizes the importance of foreign capital in financing the development plan and has taken a wide range of measures to stimulate investments. Government bonds sold in foreign capital markets offer favorable yields, and ample provisions have been made through sinking funds so that 90 per cent of amortizations have been effected from them. Foreign mining companies have been permitted to base profit and loss calculations on agreed ore prices favorable to the companies. Incentive legislation has been passed by Parliament giving tax holidays and special import and other privileges to a variety of enterprises, especially those catering to tourists. Profits earned within Jamaica by nonresidents can be remitted without limit. Arrangements for amortization of foreign borrowing are also liberal. These special incentives—proffered against the background of a stable political and economic situation—have proved to be important attractions to the foreign investor.

Wages and Prices

In general, there is a shortage of data on wage developments in Jamaica. From 1956 to 1960 total wages and salaries are believed to have increased by 40-50 per cent—more than the increase for total national income. This suggests that wage payments may have expanded more rapidly than real output and that wage increases in the future may need to be more closely related to increases in output.

Unemployment is a problem in Jamaica in spite of the rapid rate of economic growth which the economy has achieved over the past decade. It is believed that a large number of the unemployed are women who would like to supplement family income, and rural residents recently arrived at urban centers. In some agricultural areas, the number of workers appears to be insufficient, so that shortages of labor coexist with unemployment.

The total labor force has held fairly constant since 1957, at about 650,000 persons. Emigration has been a check on the growth of the labor force during this period. However, it is not clear that emigration has contributed to the solution of the problem of unemployment; many of the emigrants have been highly skilled workers who would have been useful in aiding the country to increase the rate of economic growth. The Jamaican authorities are concerned about the unemployment problem, which they feel may be aggravated by recent restrictions placed upon entry of Commonwealth citizens into the United Kingdom.

The rise of only 20-25 per cent in Jamaican prices from 1953 to 1962 is not seriously out of line with world-wide developments and must be rated as a considerable achievement.

Ten-year Development Program

The Government has under consideration a five-year development program. According to tentative planning, a basic objective will be to provide for a net increase in real per capita income of approximately 3½ per cent per annum. On the assumption of an annual rate of population growth of 2½ per cent, total national income would need to increase at a rate of approximately 6 per cent per annum in order to provide for the projected increase in per capita income.

The tentative plan assumes a ratio of 3 to 1 between additional capital investment and increased output, and a yearly depreciation rate of 7 per cent on investments. To achieve the planned rate of growth, annual capital formation should amount to nearly 20 per cent of gross domestic product for the five-year period. This level of investment is not inconsistent with actual developments in the 1956-61 period. Presumably, financing of the program would follow the pattern of the recent past, whereby capital consumption allowances, a government surplus on current account, and private net savings would provide a substantial share of the funds needed for implementing the program. Nevertheless, it is apparent that large amounts of foreign private capital would also be required to finance a development program of the size envisaged. Further, the Jamaican authorities expect that a substantial share of the program will be met by government-to-government loans.

Money and Credit

Organization and Structure of Banking System

The banking system of Jamaica is comprised of a central bank (Bank of Jamaica), six commercial banks which are branches of large international banks, and the Government Savings Bank. Before 1961, the banking business in Jamaica was virtually unregulated, the bank law then in existence having little practical significance. This situation has changed with the entry into force, in May 1961, of the Banking Law of 1960. Now any company wishing to carry on banking business must be licensed to do so by the Minister of Finance, must fulfill minimum capital requirements, and must make certain information available to the public and to the Inspector of Banks. The Law also requires banks to maintain reserves at the Bank of Jamaica, and provides for a minimum ratio of liquid assets to deposit liabilities.

The Bank of Jamaica Law was also passed in 1960, and the Bank began operations on May 1, 1961. The Bank is owned wholly by the Government, but it is a separate and distinct corporation with its own Board of Directors and Chief Executive (Governor of the Bank). Although the Bank is expected to manage its business independently of government direction, provision is made that the Minister of Finance, after consultation with the Governor of the Bank, may give to the Bank in writing such directions of a general nature as appear to the Minister to be in the public interest.

The Bank maintains separate Currency and Banking Divisions, with its issue functions segregated from the banking business. When the Bank began operations, the Currency Division took over from the Board of Commissioners of Currency their note liabilities and the assets backing the currency. The Currency Division issues and redeems Jamaican pounds on demand against sterling at par, subject to an exchange charge that may not exceed ¾ of 1 per cent either side of parity. Assets of the Currency Division may be held in gold, sterling, and securities issued or guaranteed by the United Kingdom, Commonwealth Governments, or the Government of Jamaica. The fiduciary issue (i.e., the proportion backed by Jamaican securities) may not exceed 50 per cent of the total assets of the Currency Division.

The Banking Division undertakes the usual functions of a central bank, serving as the bankers’ bank and principal banker to the Government. Operation of the Banking Division began with a transfer of important government deposits from the commercial banks and with the opening by the commercial banks of deposit accounts to meet statutory reserve requirements. Relations with the Government are prescribed by the provision that advances to the Government may not exceed 15 per cent of the estimated government revenue for the financial year in which they are made. Such advances must be repaid by the end of that year; otherwise, no more can be borrowed. Also, the Bank’s holdings of Jamaican Government securities (as distinguished from advances to the Government) in the Banking Division may not exceed seven times its authorized capital, which at present is £1 million. The Bank has not yet assumed sole responsibility for the banking business of the Government; the Treasury Deposit Account, through which certain extrabudgetary payments are handled, continues to be kept with a local commercial bank, and the Government still holds sterling balances with the Crown Agents in London. It is expected, however, that the overseas balances will be transferred to the Central Bank.

To implement credit policy, the Bank of Jamaica is empowered (1) to vary, between 5 per cent and 15 per cent, the ratio of deposit liabilities which commercial banks are required to hold at the Bank as reserves; (2) to set rates for discount and rediscount; (3) to under-take open market operations; (4) to fix a maximum limit on commercial bank loans, either generally or loans for specific purposes; (5) to establish a minimum ratio which Jamaican assets of commercial banks must bear to deposit liabilities in Jamaica; and (6) to vary the commission charges on exchange transactions within the bounds of ¾ of 1 per cent either side of parity.

Money and Quasi-money

The increase in the total stock of money and quasi-money paralleled the rise of gross national product from 1956 to 1961, with money increasing slightly less, and quasi-money slightly more, than income (Table 1). In 1962, however, money rose only slightly while quasi-money rose substantially. By the end of September 1962, the stock of quasi-money exceeded the money supply for the first time, largely in response to a sharp increase in 1961 in deposit rates paid by commercial banks to holders of time and savings deposits; in Jamaica, demand deposits do not draw interest. Demand deposits and currency holdings also grew in 1962 but at a much slower pace than time and savings deposits, as the continuance of high interest rates induced the public to direct most of the increase in its liquid assets into these latter deposits. The influence that the high rates on deposits has had on the total flow of resources to the banking system and on total saving is less clear. It may be noted, however, that between September 1961 and September 1962 the total stock of demand deposits and quasi-monetary liabilities of the banks increased by about 10 per cent, probably faster than the growth of money income.

Table 1.

Jamaica: Money and Quasi Money

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Sources: Jamaican Ministry of Finance and Bank of Jamaica.

Credit and Problems of Credit Control

Operations of the banking system in Jamaica are shown in Table 2. Bank credit conditions in Jamaica have been determined largely by the policies of the international commercial banks operating there. The Currency Board that served Jamaica until 1961 limited its extensions of domestic credit to modest investments in Jamaican Government securities (Table 3), and the scale of operations of the Bank of Jamaica, since its inception, has been small relative to that of the commercial banks. Up to 1957, the commercial banks exported substantial amounts of capital from Jamaica, their loans and advances in Jamaica in 1957 totaling less than 60 per cent of local deposit liabilities. From 1957 to 1961, however, domestic credit operations of commercial banks expanded sharply and exceeded the growth of local deposits by a wide margin (Table 4), reflecting profitable loan opportunities in Jamaica. More than half of this credit expansion was financed by liquidation of foreign assets and drawings on head offices, with particularly large net foreign borrowings by the commercial banks taking place in the period 1959-61. The borrowing from head offices in 1961 was influenced by the transfer of sizable government deposits from a commercial bank to the Central Bank and by the imposition of reserve requirements, to be discharged through deposits at the Bank of Jamaica. Of the increase in credit extended by commercial banks in the five years 1957-61, nearly nine tenths was to the private sector. Part of the growth of “unclassified items (net) “in this period reflects the construction and modernization of bank buildings, which took place at a rapid pace.

Table 2.

Jamaica: Operations of the Banking System1

(In millions of pounds)

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Sources: Jamaican Ministry of Finance and Bank of Jamaica.

Includes the central bank, the six commercial banks, and the Government Savings Bank.

Liabilities of commercial banks to home offices.

Table 3.

Jamaica: Operations of Monetary Authorities1

(In millions of pounds)

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Sources: Jamaican Ministry of Finance and Bank of Jamaica.

The Currency Board before May 1, 1961 and the Bank of Jamaica thereafter.

By late 1961, domestic credit extended by commercial banks was very large relative to local deposits. As a consequence, the banks began to exercise greater control in making new loans and advances, and in the period September 1961-September 1962 credit to the private sector was reduced slightly. However, total commercial bank credit continued to increase as holdings of Jamaican Government securities, particularly Treasury bills, rose substantially (Table 4).

Table 4.

Jamaica: Operations of Commercial Banks

(In millions of pounds)

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Sources: Jamaican Ministry of Finance and Bank of Jamaica.

The expansion in the demand by commercial banks for Jamaican securities resulted from the application of a minimum ratio of liquid assets to deposit liabilities and from the increased attractiveness of Treasury bills. The minimum liquid assets ratio which was instituted in 1961 requires that total liquid assets (including cash, deposits at the Bank of Jamaica, and specified local and foreign short-term assets) amount to at least 15 per cent of deposit liabilities. In effect, this liquid assets requirement overlaps the statutory reserve requirement, currently 5 per cent, that must be met by deposits at the central bank. The liquid assets requirement has increased the scope for placing government securities with the commercial banks, provided that the terms are made sufficiently competitive with those of foreign securities which also qualify for discharging this requirement. In this regard, the liquidity of Jamaican Treasury bills has been increased by certain changes that have been made with the advent of the Bank of Jamaica. The Bank quotes daily rates for the purchase and sale of Treasury bills, making it possible for any holder who is unable to effect a transaction elsewhere to buy or sell bills at the Bank on any day. Commercial banks may also discount Treasury bills with the Bank of Jamaica on any day at the prevailing bank rate; this contrasts with the system prior to 1961, under which commercial banks were given facilities for rediscounting bills with the Government, but seven days’ notice was required. The net impact of the changes has been to make Jamaican Treasury bills more comparable with foreign bills in terms of liquidity and also to increase the role of interest rate differentials, between Jamaica and abroad, in the calculations of potential investors. To induce commercial banks to meet a portion of their liquid asset requirements in Jamaican bills, the authorities have operated both on interest rates and on the commission charge for exchange transactions. Changes in the commission rates, within the narrow bounds permitted, are equivalent to variations in interest rates in terms of the impact on the decision to hold liquid assets in Jamaica or abroad.

Domestic credit operations of the Government Savings Bank have been quantitatively far less important than those of commercial banks; however, the increase in credit provided by the Bank to the Government has averaged about £300,000 per annum since 1957. Beginning in 1957, it has been permissible for this bank to invest two thirds of its deposits in local securities, while at least one third must be invested in U.K. securities. The Government Savings Bank has been less successful than commercial banks in attracting deposits, largely because it does not offer a full range of banking services and because it has not raised its deposit rates in line with those of commercial banks. Before 1959 the rates on deposits at the Savings Bank were higher than those on savings deposits at commercial banks, but since mid-1960 the Savings Bank rates have fallen below those of commercial banks.

In late 1962, the commercial banks were in the position of having borrowed heavily from their head offices to lend and invest in Jamaica. This is not uncommon for banks operating an international branch system in which deposit funds are channeled to their most profitable uses. As the banking system has operated in Jamaica, under the Currency Board system and under the policies adopted by the central bank, the sharp growth of credit from commercial banks has not entailed the danger of currency inconvertibility. If requests for conversion of the deposit liabilities of these commercial banks into foreign exchange should arise, they would be met mainly by the banks through drawings against their head offices. The maximum extent to which the Bank of Jamaica would be called upon to provide foreign exchange would be determined by the amount of reserve deposits that the commercial banks held with it, and these deposit liabilities, as well as the currency issue, of the Bank of Jamaica are backed in large measure by foreign exchange assets. The Bank of Jamaica is in a position to limit the demands for foreign exchange made upon it to its existing liabilities, because the financial structure of the commercial banks is such that they are not dependent, in the event of with-drawals of deposits by the general public, on credit facilities at the Bank to preserve their solvency. The Jamaican liabilities of these commercial banks are only a small fraction of their total assets, and their liquidity position is managed in the context of their over-all operations, including access to the principal organized money markets of the world. This contrasts with the situation that prevails in many countries where the banking system is composed of a central bank and commercial banks whose operations are national in scope and nature. In such a banking system, demands by the general public for conversion of deposits into foreign exchange, beyond a certain point, would usually place the commercial banks in an illiquid position which they would seek to repair by obtaining rediscounts from the central bank. To protect depositors and to limit the decline of bank credit, the central bank would be under pressure to accede to the requests for rediscounts, but such accommodation of the commercial banks would weaken the international reserve position of the central bank. In Jamaica, the view of the authorities is that their monetary and banking system has the advantage of contributing to confidence in the currency—an important factor for a country heavily dependent upon capital funds from overseas for its development.

In this framework, the problem faced by the Bank of Jamaica is that of attempting to influence credit conditions without disturbing confidence in the Jamaican pound. While there is undoubtedly some scope for credit policy, as has been evidenced by the results achieved in inducing commercial banks to meet their liquid asset requirements in Jamaican bills, the Bank has to exercise great caution in creating liabilities not backed by foreign exchange assets. In particular, a substantial extension of credit by the Bank of Jamaica to the Government, either in the form of advances or through the purchase of Treasury bills, would place a severe burden on the foreign reserves of the Bank and would endanger stability of the Jamaican pound. This possible danger has been recognized by the law that established the Bank placing a limit upon bank lending to the Government. The authorities realize the limitations of discount rate changes and open market operations in view of both the absence of well-developed local money and securities markets and the close contact between financial institutions in Jamaica and foreign capital markets. A credit policy that deviates moderately from that imposed by conditions in external capital markets is practicable through the use of changes in short-term rates in Jamaica, buttressed by variations in commission charges on exchange transactions. But the scope for monetary management in this regard is undoubtedly quite limited. There is also awareness that direct credit controls (such as maximum limits on commercial bank loans and enforcement of minimum ratios of Jamaican assets to total deposit liabilities of commercial banks) are difficult to administer and may discourage the banks from importing funds from abroad; consequently, the intention is to apply such measures only in extraordinary situations. To effect basic changes in credit policy, the authorities are relying on changes in the minimum reserve ratio that is set by the Bank of Jamaica for the commercial banks. As stated above (p. 252), the Bank may vary this ratio between 5 per cent and 15 per cent; however, it has been held at 5 per cent since the Bank began operations.

To meet what they regarded as an excessive hire-purchase credit boom which developed in 1960 and 1961, the authorities applied direct controls over the terms for downpayments and for repayment periods. This boom did not originate within the commercial banking system; rather, it developed with the advent of new finance houses. While not participating directly in consumer credit, the banks did provide resources to the finance houses and merchants that made such loans. The authorities were disturbed by the large commitment of future savings of the community to hire-purchase contracts; accordingly, in October 1960, the Government imposed minimum deposit requirements on motorcars and other motor vehicles and set maximum repayment periods. A few months later, the finance houses voluntarily fixed a scale of minimum downpayments and maximum repayment periods on other classes of goods. As it turned out, hire-purchase credit outstanding began to fall in mid-1961, and it has been reduced substantially since then. The factors behind the decline are not easily sorted out, and it is not possible to assess the relative importance of the policy of restriction and of mere consumer adjustment to extended debt positions.

Interest Rates

Interest rates in Jamaica are influenced strongly by the rates prevailing abroad, because the commercial banks of Jamaica operate in many countries and are closely linked with the London capital market. Specifically, the lending rates of the commercial banks have, for many years, reflected the movements of the bank rate in the United Kingdom. However, since the beginning of operations in 1961, the Bank of Jamaica has posted a bank rate, and the commercial banks have begun to relate their lending rates to it. The Bank of Jamaica’s rate has been above that in the United Kingdom most of the time, the exception being a period of four months in the summer and autumn of 1961 when the rate in Britain was raised sharply to meet exceptional circumstances. At that time, the Bank of Jamaica utilized the technique of varying the commission charge on exchange transactions to insulate partially interest rates in Jamaica from external influences. As more normal policy, however, it appears that the intention of the Jamaican authorities is to hold interest rates in Jamaica at levels that will enable the local market to retain and to attract foreign funds.

Interest rates paid to depositors and charged on loans for important segments of the capital market are shown in Table 5. There appears to have been a fairly sharp rise in rates between 1959 and 1961, and a slightly downward tendency in 1962. Commercial bank rates on time and savings deposits have increased sharply in recent years, with a large part of the change taking place in 1961. The rise has been in excess of that in rates on loans, and reflects, to some degree, the increased activity of the finance houses, which have begun to compete for deposits.

Table 5.

Jamaica: Selected Interest Rates, December 31, 1959-62

(In per cent per annum)

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Sources: Jamaican Ministry of Finance and Department of Statistics.

Public Finance

In Jamaica, the public finance sector encompasses the fiscal activities of the Central Government, 13 local governments, and a number of government agencies with varying degrees of autonomy. The fiscal operations of local governments are relatively small (amounting to less than 15 per cent of those of the Central Government), and more than half of their outlays are supported by transfers from the Central Government. Of the various government agencies, many rely heavily on subsidies from the national budget. Consequently, in the discussion that follows, principal attention will be directed toward the operations of the Central Government. (These are summarized for the latest five fiscal years in Table 6.)

Table 6.

Jamaica : Operations of the Central Government, Fiscal Years Ended March 31, 1959-63

(In millions of pounds)

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Sources: Jamaican Ministry of Finance, and estimates by the staff of the International Monetary Fund.

Estimated data.

Contributions to sinking funds and debt redemptions are excluded.

Jamaica’s fiscal year runs from April 1 to March 31. Budget operations are virtually on a cash basis, with expenditures and revenues reflected in receipts of and issues from the Consolidated Fund, which comprises the Government’s deposits and cash balances in Jamaica and abroad. Expenditure appropriations are made for a single budget year and any unspent portions cannot be carried forward to a subsequent budget unless authorized under new appropriations.

Recent Trends

While the Central Government’s operations have expanded considerably in recent years, their relative importance in the economy has changed at a much slower pace. From the fiscal year 1953/54 to 1961/62, central government revenues and expenditures more than doubled, but national output grew nearly as fast (Table 7). Some of the increase in revenues and expenditures was due to price and wage increases, but most of it represented an expansion of the scale of government operations. With central government revenues amounting to about 15 per cent of gross domestic product and very light taxation by local governments, it would appear that the tax burden in Jamaica is not unduly severe.

Table 7.

Jamaica: Central Government Revenues and Expenditures As Percentages of Gross Domestic Product, Fiscal Years Ended March 31, 1954-62

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Sources: Jamaican Ministry of Finance and Department of Statistics.

Gross domestic product series relates to calendar years 1953, 1955, 1957-61.

The tax system relies heavily on income taxes and customs duties. At present, each of these sources contributes about one third of government revenues, but the proportion yielded by income taxes has been increasing. Since 1954, income tax receipts have quadrupled while returns from customs duties have slightly more than doubled. Most of the income taxes collected are paid by companies, the bauxite mining firms contributing a large proportion of the total. The income of persons is subject to progressive taxation, but personal and family exemption allowances are such that the level of income up to which no tax is paid is high relative to national per capita income. The result is that only a small proportion of the population now pays income tax. However, if the existing income tax structure is maintained over time, the yield will be highly elastic with respect to increases in national income, reflecting both the movement of persons into tax-paying income brackets and the application of progressively higher rates to the increases in income of those already paying taxes.

Revenues from customs duties have expanded more rapidly than total imports, reflecting the increases in duty rates and the expansion of imports of consumer durable goods (notably motorcars), which are subject to the higher tariff rates. Excise taxes now account for about one seventh of government revenues, nearly all of these deriving from taxes on tobacco, rum, and beer. The growth of excise tax revenues has not kept pace with the rise of private consumption, principally because of the slow expansion of receipts from taxes on tobacco.

Land and property taxes provide a relatively small share of government revenues, chiefly because land valuations for tax purposes have not been kept current. Various attempts to update valuations have been made, but the work has not been completed. Since present legislation already provides adequate tax rates for land and property, maximization of the tax potential from this source will depend upon completion of the revaluation program.

Government revenues are influenced by the operation of incentive laws which allow tax concessions for new industries. Some of the concessionsare in the form of exemptions from customs duties for material imported, while others grant income tax relief.

Data on government expenditures indicate that more than one fourth of the outlays in the last few years has been for capital projects. The data available also suggest that the proportion of total expenditures devoted to such projects has increased since 1954-56, but comparisons of capital spending between an earlier period and recent years must be interpreted with caution because strict comparability of the data is not assured. In the category of recurrent expenditures, the most important development in recent years has been the sharp rise in spending on education and social welfare, mainly reflecting the rapid increase in the number of children attending schools. The cost of general administration in the fiscal year 1962/63 rose fairly sharply above such costs in previous years as a consequence of defense and foreign service expenditures associated with responsibilities assumed with independence.

In recent years, the deficit on the over-all fiscal operations of the Government has averaged slightly more than 10 per cent of expenditures. A small part of this deficit has been covered by grants from abroad, but drawings on long-term foreign loans have been far more important. Past practice has been to borrow externally in fairly sizable tranches, perhaps in excess of the requirements for a single budget year, when foreign capital markets have been propitious. Borrowing from the banking system has been comparatively unimportant in most years, but recently the potential scope of such operations was expanded with the imposition of liquid asset requirements on commercial banks that may be satisfied by holdings of Jamaican Treasury bills.

Since 1956 Jamaica’s public debt has virtually doubled; however, this expansion has not exceeded the growth of national output; nor has it affected to any great extent the proportion of total government receipts allocated to servicing the national debt. Interest payments account for a large portion of the public debt burden, reflecting the fairly long average maturity of Jamaican Government obligations. Nearly all redemptions of debt are financed out of accumulated sinking funds, thus avoiding the sharp disruptions which would be occasioned by the need to secure financial resources to retire or refinance large blocks of debt.

Fiscal Prospects

Preliminary estimates of the 1963/64 budget indicate a modest increase in recurrent expenditures. If capital expenditures remain about the same as in recent years, and if government revenues increase about as much as in the recent past, then the problem of securing noninflationary finance to cover the budget deficit will again emerge. While part of this prospective deficit may be covered by borrowing locally (from commercial banks, insurance companies, and others), the amounts thus available are probably small; also, this form of borrowing places the Government in direct competition with private borrowers, many of whom may not have alternative sources. Borrowing from abroad, which the Government has relied upon heavily in the past, has become increasingly difficult and costly. Part of the increased cost of such borrowing simply reflects the higher interest rates prevalent now, compared with those five or ten years ago. However, the rise in interest rates on Jamaican borrowing represents, in part, a relative deterioration in Jamaica’s international credit standing; in 1955, yields on Jamaican Government bonds in the London market ran about 10 per cent above those of U.K. Government bonds, but by 1962 the yields on Jamaican securities in that market were about 25 per cent above those on U.K. securities. This weakening in Jamaica’s credit position appears to have stemmed from several factors. Important among them are the disturbed political and military situation in the Caribbean area; the uncertainties as to the credit-worthiness of newly independent countries, which seem to be viewed as a group by potential investors; and the decrease in the volume of funds available to the Crown Agents as a result of the movement to independence of many Colonial territories which previously held large balances with these Agents. In the past, the Crown Agents have performed an important function in facilitating intercolony lending.

At the same time that Jamaican prospects for borrowing in international capital markets have dimmed, the Jamaican authorities have been working on a development plan that calls for an increased flow of capital funds from abroad. They intend to intensify their efforts to obtain loan finance in the organized capital markets of London, Toronto, and New York, but they also intend to seek additional means of foreign economic assistance, including development loans from international institutions and foreign governments. To reduce the danger of delay in carrying out the development program because of interruptions or lags in the inflow of external assistance, the Government of Jamaica has arranged stand-by credits with foreign commercial banks. This kind of financing is not intended as a substitute for long-term loans, but is designed merely to reduce uncertainty as to the pace of development spending.

Balance of Payments

The current and capital accounts of the balance of payments are prepared independently of each other. The current account, which includes unilateral transfers, is prepared by the Ministry of Finance; the capital account, which is labeled “identified net capital movements,” is prepared by the Department of Statistics. Net errors and omissions that arise from combining the two accounts to form the balance of payments have been large in some years, with errors in estimates for private capital movements probably accounting for most of the difference. Another factor influencing the calculation is the arbitrary determination of the unit price for bauxite exports.2

Foreign Exchange Reserves

The data on external assets and liabilities shown in Table 8 tend to understate Jamaica’s true net foreign assets position, because gross assets are almost entirely current in nature while gross liabilities are, in large part, long term. For example, the external assets of the Government are in the form of money on call in foreign banks or in sinking funds set aside to meet maturing foreign indebtedness. By contrast, the Government’s external liabilities consist of bonded indebtedness with maturities of up to 20 years.

Table 8.

Jamaica: Foreign Assets and Liabilities, 1953-62

(In millions of pounds)

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Source: Bank of Jamaica, Financial Statistics Digest.

To May 1, 1962, held by the Currency Board; since then, held by the Currency Division and Banking Division of Bank of Jamaica.

Includes long-term liabilities.


Foreign assets of the monetary authorities

Prior to May 1, 1961, when the Currency Board was still in operation, there was a direct relationship between the amount of banknotes outstanding and the assets of the Board, which consisted of sterling securities or balances. (In later years, up to 30 per cent of the Board’s assets could have been invested in Jamaican securities.) Nevertheless, the Board was always in a position to meet easily the demand for sterling which might have arisen from the conversion of Jamaican pounds. With the advent of the central bank, the direct relationship between currency issue and foreign exchange reserves was loosened somewhat, at least legally. The fiduciary issue (i.e., the currency issue covered by Jamaican securities) may now reach 50 per cent of total currency issue. In practice, however, the authorities have continued to manage the portfolio of the Bank of Jamaica in a manner similar to the operations under the Currency Board.

The foreign exchange assets of the monetary authorities (the Currency Board until May 1961, and the Bank of Jamaica thereafter), excluding foreign assets of the Government, rose from £4.2 million at the end of March 1953 to £6.8 million at the end of March 1961. These assets increased rapidly during the second quarter of 1961, when the Government sold a substantial part of its foreign exchange assets to the newly formed Bank of Jamaica; since then, they have been substantially higher than in earlier years.

Commercial bank’s foreign reserve position

In the past, commercial banks operating in Jamaica tended to invest abroad funds received from domestic resources (Table 8). As a result, foreign assets exceeded foreign liabilities. This pattern began to change in 1957 as commercial banks invested locally more funds than were received from domestic sources. Because of this new inflow of funds, foreign exchange assets of commercial banks were drawn down and overdrafts with their head offices were created. From 1957 to 1961, the net inflow of funds through commercial banks totaled nearly £20 million. As a result of these operations, the net foreign reserve position of commercial banks at the end of 1961 was negative, by nearly £12 million. Since then, the banks have reduced considerably their overdraft positions with their head offices. This has been associated with a cutback in domestic hire-purchase credit.

Government’s foreign exchange reserves

The Governments foreign exchange reserves (excluding the foreign assets of the monetary authority) have nearly doubled during the past ten years. However, the amount of these external assets has been directly related to the policy of the Government to implement its development program and to conditions in the international bond market. The Government was able to obtain substantial foreign credit in 1958 and 1959, and in these years the Government’s assets rose. After each rise, there was a downward tendency in the Governments foreign assets position because of expenditures for development purposes. Only from March 1961 to March 1962, a period during which foreign exchange assets of the Government were sold to the Bank of Jamaica, did assets decline sharply. Until that time, foreign assets were equal to about 75 per cent of foreign liabilities. This was approximately the same as the ratio in 1953.

The Jamaican Government holds substantial foreign assets outside the central bank; this reflects the policy of meeting maturing foreign indebtedness from sinking funds. The maintenance of these segregated accounts may be useful in encouraging investments in Jamaican securities. One result of the policy has been that there is no record of default on Jamaican bonds.

Major Balance of Payments Developments

During 1957-61, Jamaica incurred a sizable deficit on its goods and services account that was financed by unilateral transfers (principally migrants’ remittances) and by a substantial inflow of private capital (Table 9). With the exception of 1961, there was also a net inflow of official long-term capital. The cumulative balance of payments surplus (as measured by changes in the foreign reserves of the monetary authorities and the Government) for the period 1957-61 amounted to more than £7 million. The net deficit on the goods and services account changed little from 1957 to 1958, rose sharply in 1959, and decreased in both 1960 and 1961. The marked rise in 1959 was due primarily to a decline in the terms of trade and to an increased volume of imports. The decline in 1960 was due largely to a sharp rise in the volume of exports and, in lesser degree, to increased tourist expenditures in Jamaica. Its further decline in 1961 is attributable to a continued rise in exports accompanied by a decline in the volume of imports. On the basis of data for the January-September periods, it appears that the net deficit on the balance of trade and on the goods and services account was less in 1962 than in 1961. Foreign travel (tourist) expenditures, which after exports constitute the major source of exchange for the island, more than doubled between 1951 and 1961, and evidently increased in 1962. To a large degree, receipts from tourism have been offset by remittances of investment income (which after imports constitutes the major source of outgoing payments); these remittances showed a steady rise during the period under review.

Table 9.

Jamaica: Balance of Payments, 1957-62

(In millions of pounds)

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Sources: Jamaican Ministry of Finance and Department of Statistics, and estimates by the staff of the International Monetary Fund.

In preparing the balance of payments, several minor adjustments have been made in the export and import figures presented in Tables 10 and 11.

Data on short-term capital movements for the nonbanking sector are not available.

According to the data available (Table 9), the inflow of private capital to Jamaica declined from 1957 through 1960. This decline was related to the near completion of the investment program in the bauxite and alumina industries. However, commercial banks brought in substantial amounts of capital after 1956 to finance expanding loan portfolios, the imposition of reserve requirements, and the construction of new bank buildings.

Exports, tourism, and unilateral transfers

A relatively large proportion of Jamaica’s income is due to exports, which average about one fourth of gross national product. The value of exports more than quadrupled between 1948 and 1957, declined moderately in 1958 and 1959, and rose sharply in the next two years (Table 10). Most of the growth since 1959 has resulted from increased shipments of bauxite and alumina, which now account for about one half of the value of exports. Other important items are sugar and bananas. Exports of bananas tripled from 1948 to 1957, but have tended to decline in recent years; sales of sugar abroad have risen moderately since 1957. Manufactured goods produced for export have increased strikingly in relative terms since 1957, but the total value of these exports is still small.

Table 10.

Jamaica: Value of Exports, 1948 and 1957-61

(In millions of pounds)

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Source: Jamaican Department of Statistics, External Trade of Jamaica, Calendar Years, 1956, 1959 and 1961.

Foreign markets for bauxite and sugar are governed largely by negotiated agreements. Most bauxite exports are made under triangular barter arrangements with the United States; under the arrangements, Jamaican bauxite is purchased for stockpiling purposes and payment takes the form of U.S. agricultural surpluses for sale abroad. Since continuation of the U.S. barter arrangements is uncertain, efforts are being made to place the arrangements on a longer-term basis. Of the four bauxite companies operating in Jamaica, only one processes bauxite into alumina. In 1961, about half of this alumina was shipped to Canada; most of the remainder went to Norway, Sweden, the United States, and the Federal Republic of Germany.

Sugar is exported under the Commonwealth Sugar Agreement, which provides an over-all quota of 270,000 tons for Jamaica. Of this amount, the United Kingdom purchases 197,000 tons. The remainder is sold to Canada at a price normally above world market prices but less than the U.K. price. In addition, Jamaica receives a share of the British West Indies sugar quota for the U.S. market. As a result of these agreements, nearly all of Jamaica’s sugar exports are currently being made under favorable price arrangements.

Trade with the Commonwealth countries represents close to half of Jamaican exports. However, the share of the Commonwealth in Jamaican export trade has declined markedly in the past decade, and that of the United States has increased. These changes are closely related to the development of the bauxite industry, which ships its products largely to the United States.

The growth in net receipts from unilateral transfers has been due principally to increased remittances by Jamaicans working and living abroad, following the substantial amount of emigration in 1960 and 1961. Also included among unilateral transfers are donations received on official account, mainly Colonial Development and Welfare grants from the United Kingdom. At times in the past, the amounts received in this form were sizable; in the future, however, such assistance will be limited to small unused balances which were available to Jamaica at the time it attained independence.


The value of imports has grown with the expansion of national output, more than tripling between 1948 and 1957, and rising at a slower pace since then (Table 11). A substantial part of the rise in the 1948-57 period was due to international price increases. However, since 1957 the prices of imports have risen slowly, and the increase in total value has reflected, in the main, greater volume.

Table 11.

Jamaica: Value of Imports, 1948 and 1957-61

(In millions of pounds)

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Source: Jamaican Department of Statistics, External Trade of Jamaica, Calendar Years, 1956,1959 and 1961.

With the development of the Jamaican economy, some changes in the composition of imports have taken place. Machinery and transport equipment, which represented 16 per cent of total imports in 1948, averaged 22 per cent in the 1959-61 period. On the other hand, the share of other manufactured goods has tended to decline, reflecting the investments in domestic textile, metal manufacturing, and other industrial enterprises which have made possible some substitution of locally manufactured items for imports. Increased imports in the fuels and chemicals categories also reflect Jamaica’s industrial development since 1948.

Food items represented 24 per cent of total imports in 1948, but declined to less than 20 per cent of the 1959–61 total. However, it appears that this relative decline in the share of food imports reflects changes in consumption patterns as incomes have risen, rather than success in increasing agricultural output for home consumption. In a country where incomes have risen rapidly, imports of nonfood items may be expected to rise more rapidly than imports of basic food items. For Jamaica, this expectation has been borne out in the food category as well as in the over-all composition of imports. For example, the volume of cereal imports has risen relatively little over the years. Since Jamaica is not an important cereal producer, this slow rise is attributed to a shift in consumption patterns away from this basic food category. On the other hand, imports of meat and dairy products have increased at a fast pace, in keeping with rising incomes.

Exchange Controls 3

Jamaica is a member of the sterling area. The Jamaican pound is officially at par with, and is freely convertible into, the pound sterling. The official rates for U.S. dollars are based on the buying and selling rates in the London market. As pointed out above (p. 252), the Bank of Jamaica is authorized by law to levy a commission charge of up to ¾ of 1 per cent on inward and outward transfers. Such commission charges have been utilized by the Bank, as a supplementary device to the discount rate, in order to regulate the movement of capital funds.

The country’s exchange and trade systems have continued to follow closely the U.K. pattern. The exchange control law is based on the U.K. exchange control law, and changes in the U.K. regulations have generally been reflected in the Jamaican regulations.

As presently operated, the Jamaican exchange control permits freely payments for current transactions, provided the authorities are satisfied that no unauthorized capital remittances are involved. Trade restrictions exist, however. In addition to tariff duties used for revenue as well as protective purposes, a number of imports are subject to quantitative restrictions designed to protect local industries. Balance of payments considerations are not a deciding factor behind the imposition of trade controls.

Capital transactions with residents of other parts of the sterling area are freely permitted. Capital transactions with other countries are controlled. Direct investment from abroad in lines of production regarded favorably by the authorities is encouraged by guaranteeing the investor free remittance of profits and capital. Other capital investments can be realized only through the security sterling market, but this differentiation is not of great importance since the discount now applicable to funds transferred through this market is small. Purchases of sterling securities by residents of Jamaica from other residents of the sterling area can be made freely. Purchases of non-sterling securities have to be made through the “reinvestment dollar” market and require the approval of the Exchange Control Authorities. The importance of this differentiation depends upon the prevailing discount rate for such transactions, which on April 19, 1963 was 9½ per cent.

Quelques aspects de l’économie de la Jamaïque


Cet article analyse la situation économique de la Jamaïque et plus particulièrement le système financier et la balance des paiements de ce pays.

La Jamaïque a connu un taux de croissance très élevé au cours de la dernière décennie; la production annuelle à prix constants s’est accrue d’environ 6 pour-cent par habitant. Le secteur minier (surtout en bauxite) a enregistré une expansion considérable, tandis que I’importance relative de Fagriculture déclinait. Le tourisme, déjà important depuis de nombreuses années, s’est rapidement développé. Le Gouvernement envisage la mise en œeuvre d’un plan de développement quinquennal visant à accroître le revenu réel par habitant de 3,5 pour-cent par an.

Le système bancaire se compose d’une banque centrale (Banque de la Jamaïque), de six banques commerciales—succursales de grandes banques internationales—et de la Caisse d’Epargne Publique. La Banque de la Jamaïque, qui a commencé ses opérations en 1961, a remplacé le Conseil Monétaire; elle exerce les fonctions normales d’une banque centrale et dispose des pouvoirs traditionnellement réservés aux banques centrales.

L’augmentation de la masse monétaire (monnaie et quasi-monnaie) ces dernières années a été parallèle à celle du produit national brut. En 1961, le relèvement sensible des taux applicables aux dépôts à terme et aux dépôts d’épargne dans les banques commerciales a eu pour effet d’encourager l’épargne sous cette forme. Depuis 1957, les opérations de céedit intérieur des banques étrangères en Jamaïque ont largement excéde l’accroissement des dépôts locaux, ce qui traduit l’existence de possibilitiés de placement très rentables. Les relations étroites entre ces banques et les marchés de capitaux étrangers ont facilité l’entree de capitaux de l’etranger, mais limitent le champ d’action de la politique monétaire intérieure.

Les rentrées fiscales du Gouvernement se sont fortement accrues bien que leur accroissement n’ait pas été en rapport avec celui du produit national. Les recettes proviennent surtout de droits de douane et de plus en plus de l’impôt sur le revenu. Environ un quart des récentes dépenses du Gouvernement a été consacré à des projets d’investissement. Les dépenses afférentes aux services sociaux et à l’éducation ont rapidement progressé et témoignent de la forte augmentation du nombre d’enfants fréquentant les établissements scolaires.

Le compte biens et services de la balance des paiements accuse généralement un déficit qui est financé en grande partie par des transferts unilatéraux et des entrées de capitaux privés et, à un degré moindre, par des capitaux publics à long terme. Les exportations représentent en moyenne un quart du produit national brut; entre 1948 et 1961 elles ont plus que quadruplé en raison surtout des expéditions de bauxite et d’alumine. Les importations ont aussi quadruplé. L’évolution du systéme de change et du commerce extérieur de la Jamaïque a suivi celle du Royaume Uni.

Algunos aspectos de la economía de Jamaica


Este artículo sobre la situación económica de Jamaica analiza principalmente el sistema financiero y la balanza de pagos.

En el transcurso del último decenio, Jamaica ha experimentado una tasa de crecimiento notablemente rápida; su producción real por habitante ha aumentado más o menos en un 6 por ciento al año. Su minería, que explota principalmente bauxita, ha señalado una expansión considerable, en tanto que la agricultura ha declinado en importancia. El turismo, importante durante muchos años, se ha ido desarrollando rápidamente. El Gobierno está estudiando un plan quinquenal de desarrollo cuya finalidad es elevar el ingreso real por habitante en un 3,5 por ciento al año.

El sistema bancario está compuesto por un banco central (Banco de Jamaica), por seis bancos comerciales que son sucursales de grandes bancos internacionales, y por la Caja Nacional de Ahorros. El Banco de Jamaica, que se organizó en 1961, reemplazó a la Junta Monetaria; lleva a cabo las funciones normales de banco central, para lo cual cuenta con los instrumentos tradicionales.

El dinero y el cuasidinero han aumentado en los últimos años en forma paralela al aumento del producto nacional bruto. En 1961 hubo una acentuada alza de los tipos de interés aplicables a depósitos a plazo fijo y de ahorros en los bancos comerciales, la cual ha esti-mulado esta clase de ahorros. Desde 1957, las operaciones de crédito interno de los bancos comerciales internacionales establecidos en Jamaica han ido excediendo, con bastante margen, al crecimiento de los depósitos locales, lo que señla la existencia de posibilidades de colocaciones lucrativas. El estrecho contacto que existe entre estos bancos y los mercados de capitales extranjeros, ha facilitado la afluencia de capitales de otros países aunque a la vez ha limitado el campo de acción del manejo interno de la moneda.

Las operaciones fiscales del Gobierno se han expandido considera-blemente aunque no en proporción a la productión nacional. Los ingresos fiscales proceden principalmente de los derechos de aduana y, cada vez en mayor cuantía, del impuesto sobre la renta. Alrededor de una cuarta parte de los gastos del gobierno han sido para proyectos de inversión. Los gastos de asistencia social y educación han crecido rápidamente, a raíz del fuerte aumento del número de niños que asisten a las escuelas.

La balanza de pagos acusa, por lo general, un déficit en la cuenta de bienes y servicios, el que ha sido financiado en gran parte mediante tranferencias unilaterales y la afluencia de capitales privados y, en un grado menor, por medio de capitales públicos a largo plazo. Las exportaciones representan en término medio alrededor de la cuarta parte del producto interno bruto y casi se cuadruplicaron en los años de 1948 a 1961 debido principalmente a los embarques de bauxita y alúmina. Las importaciones también se cuadruplicaron. Los sistemas cambiarios y comerciales de Jamaica han seguido la pauta dada por el Reino Unido.


Mr. Clark, Chief of the Caribbean Division, received his graduate training at Harvard University. Formerly he served as Economic Advisor to the Greek Government.

Mr. Beza, Assistant Chief of the Caribbean Division, received his undergraduate and graduate training at Harvard University. Formerly he taught at Harvard University and Princeton University.

Mr. Lobo, economist in the Caribbean Division, received his undergraduate and graduate training at the University of California. Formerly he taught at Georgetown University.

Mr. Makdisi, economist in the Exchange Restrictions Department, is a graduate of the American University of Beirut and of Columbia University. Formerly he was on the staff of the UN Bureau of Economic Affairs and taught at the American University of Beirut.


This paper has been excerpted from a comprehensive study of the Jamaican economy. It concentrates on the financial system and the balance of payments, other aspects being dealt with only so far as necessary for an understanding of the questions discussed.


The unit price used to estimate the value of bauxite exports in the balance of payments calculation is a price which is agreed upon between the Jamaican Government and the bauxite companies. It is not necessarily the market price. However, changes in the valuation of bauxite exports are offset by changes in the valuation of investment income, so that the net effect on the current account remains unaffected by overvaluation or undervaluation of bauxite exports.


For further details, see International Monetary Fund, Fourteenth Annual Report on Exchange Restrictions (Washington, D.C., 1963).