Robinson hits back at recovery claims - Opposition finance spokesman warns of more pain ahead

Opposition Spokesman on Finance Julian Robinson is warning that there is trouble ahead for Jamaican households, countering reports that the country’s economy is recovering faster than projected.

Robinson said the economy has contracted for the last three quarters and is projected to contract again for a fourth quarter.

Addressing party supporters at the People’s National Party’s (PNP) 88th Annual Conference in Westmoreland on Sunday, he pointed to a near-eight per cent inflation rate, and a $28.7-billion revenue shortfall that forced $30 billion in new borrowing.

He warned of skyrocketing costs for everyday goods, including rice and flour, even as he signalled impending interest rate hikes on mortgages, car loans, and business borrowing.

“Comrades, [last] week, there was a report which said that the Jamaican economy is doing better than projected. It said we are recovering faster than we believe we should. At first, I thought they were talking about a foreign land, because I said it can’t be the same Jamaica that I live in,” Robinson told party supporters gathered at Independence Park in Savanna-la-Mar, the Westmoreland capital.

“ … It can’t be the same Jamaica where every week you go to the supermarket, flour gone up, rice gone up. If you dip inna your pocket and if you spend $1,000 last month, you have to spend $1,500 today. It can’t be the same Jamaica that I hear about.

“And how can it be the same Jamaica when, for the last quarter, the Government’s own revenues were $28.7 billion less than they projected? How can the economy be performing better than you project?” he questioned.

Economic contraction

Headline inflation rose steadily over the summer, moving from 6.7 per cent in June to 7.5 per cent in July, while hitting 7.9 per cent in August. The figures exceeded the Bank of Jamaica’s target range of 4 to 6 per cent.

Economic contraction slowed to 2.9 per cent in the June quarter following deeper drops of 7.1 per cent and 4.1 per cent in the prior two periods. Although this marks a third straight quarter of decline, the figure beats both initial Budget projections and revised post-hurricane forecasts.

Last week, Finance Minister Fayval Williams reported that the economy was recovering faster than projected following the damage caused by Hurricane Melissa.

Williams said the quarters are becoming “less negative”, calling this “a good sign”.

“In November of last year, right after the Category 5 Hurricane Melissa, the Planning Institute of Jamaica expected that Jamaica would not get back to its pre-Melissa level of output until the last quarter of 2028, three years down the road ... . The Planning Institute now expects that we will begin to see growth in the second quarter of 2027,” said Williams.

However, Robinson countered the finance minister, questioning her position while noting that the Government’s imposition of new taxes and its reported failure to deliver hurricane relief are actively deepening the economic strain across the island.

“And as the cost of living continues to rise, as inflation goes above the Government’s own projections, it is very likely that soon you going to face an increase in interest rates. What that mean is, if you are a business and you borrow money from the bank, you [are] going have to go pay more upon the loan. It means for your car loan, you going have to pay more. It means for your mortgage, you going to have to pay more. And this person is saying the economy is doing better than projected,” he said.

“ … Dem love blame Melissa for everything. Melissa is the reason for everything. But we know for the last two years before Melissa, that this economy was in trouble. Dem sell off the revenues from Norman Manley Airport and Sangster Airport 12 years in advance to fund the Budget. And having sold off those assets to fund the Budget, dem no have no more asset to sell off to fund the Budget,” Robinson said.

He criticised the imposition of new taxes, claiming this has caused the economy to further contract.

Further, he said a PNP government would not “sit on the money that was provided to provide relief for people, and the Government don’t give it to the people who are most in need”.

Robinson said the economy will continue to lag if economic activity is not pushed, especially in western Jamaica.

He said the PNP would drive growth by supporting storm-affected westerners, put greater focus on renewable energy amid rising oil prices globally, and give small businesses tax breaks, among other things.

kimone.francis@gleanerjm.com