Wary that the International Monetary Fund (IMF) might not have fully shed its perceived draconian tactics, economist Dr Michael Witter is batting for Jamaica to create a special team whose job would be to provide answers to shrinking the country's trillion-dollar debt, including negotiating deals for debt forgiveness.

But at a forum at the University of the West Indies, Mona, where Witter has tenure as a lecturer, the academic agreed that the IMF, for now, seemed Jamaica's best hope for carrying on funds to weather its current recession.

"Should there not be within the debt management programme a team whose mandate is to find ways to get rid of some of the debts; to have some written off rather than an after thought?" he asked.

Witter made the recommendations while weighing in on the theme 'Economic Challenges and Opportunities for the Nation', at an economic policy forum organised by UWI, Mona, on Wednesday.

Stock of liabilities

Jamaica currently has a debt portfolio of $1.26 trillion.

The US$1.2 billion of borrowings that the IMF standby facility, if approved by the fund, would facilitate will add to the stock of liabilities, but will come at a cheaper price than Jamaica would have been able to raise without the imprimatur of the fund.

Witter was hesitant to buy into the argument that other academics and politicians have been pitching, that the IMF has undergone a change in outlook and culture since the 1970s and into the 1980s when Jamaica first did business with the multilateral agency, and was now much more friendly and empathetic.

Underperforming

That real test, he told the forum, is yet to come - for example, were Jamaica to fail to meet the conditionalities of the standby agreement in the periods ahead.

"The risk of underperforming and failure to achieve targets would mean a breaching of the IMF agreement and one has to ask the question," said the economist, "with the consequences that we had of the hardening of IMF conditions in the past, will they persist?"

Witter also argued that there was no better opportunity for Jamaica, in the midst of the crisis, to make hard fiscal decisions.

"If ever there is going to be a climate that is favourable to a poor indebted country trying to deal with its debt, it must be in this period of time here," he said.

Government hopes to formalise borrowing relations with the IMF next month. Witter suggested that the country might want to revisit its debt management programme before the signing.

"If there is a new and different IMF, a return to a liability management programme of the sort that we had before, would it be deemed as violating loan conditions?" he asked.

Jamaica could, he said, consider floating development bonds to address the debt.

Addressing the same issue, financial analyst, R. Anne Shirley, a panellist at the forum, suggested that Jamaica's debt is even more obese than the current numbers show.

Shirley is a columnist with the Financial Gleaner.

"We are sitting with a whole series of obligations. They are no longer contingent liabilities, they are the debts of all Jamaicans sitting, waiting for us to acknowledge them," she said, citing heavily indebted entities such as Air Jamaica - over US$1 billion; Sugar Company of Jamaica - accumulated a debt of J$21 billion; and the JUTC, whose deficit is projected to hit $6.3 billion this year.

"If we start to put some of those numbers together as to what debt we owe, it is not $1.2 trillion, it is much more than that, and if we start to go into some of the 'profitable' public bodies in this country and start to see there situation, then we start to understand where we are," said Shirley.

"I have been saying this for over a year that I see a serious hurricane coming towards us," she said.

Keith Collister, who is also a financial analyst and head of the tax policy committee of the Jamaica Chamber of Commerce said the Government should be lobbying hard for the IMF to give the country "a break" as it relates to its debt issue.

"Jamaica has been very lax in taking advantage of a very loud voice in the world," he said. "I am really upset that the Government has not seen fit to hire CaPRI (Caribbean Policy Research Institute) or the University of the West Indies to accurately lobby for this support. In other words, give us a break."

Collister said he was told that what he was mooting was not IMF policy, but insisted that it should be part of Jamaica's agenda - saying, you get what you negotiate for.

dionne.rose@gleanerjm.com