Jamaica will strengthen public policy as well as the efficiency and effectiveness of fiscal management to address the health and economic crisis caused by COVID-19, with a $100 million loan approved by the Inter-American Development Bank (IDB).
This is the second operation under the programmatic policy lending (PBP) modality, which consists of two technically linked, but financially and contractually independent operations. The first was approved by the IDB in March 2021.
The new loan will ensure the timely availability and execution of public resources to address the health crisis caused by the pandemic.
It will also strengthen the counter-cyclical effect of fiscal policy with the temporary implementation of measures to protect the income of vulnerable households and increase corporate liquidity.
Some of these measures include improvements in the targeting of social programs, relief for the tourism sector and the implementation of a tax credit program for micro, small and medium-sized enterprises (MSMEs).
IDB financing will also support reforms aimed at spurring economic and fiscal recovery in the post-pandemic period, including the creation of an independent budget commission to oversee public spending and improvements in governance and representation. women on all boards of public bodies and in tracking climate-related public spending, among other measures.
This operation is in line with Vision 2025 – Reinvesting in the Americas: A Decade of Opportunity, created by the IDB to achieve recovery and inclusive growth in Latin America and the Caribbean, in the areas of small and medium enterprises, gender and inclusion, and climate change.
The $100 million IDB loan has a maturity of 20 years, a grace period of 5.5 years and an interest rate based on SOFR.