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Ministry of Finance and the Public Service Fiscal Policy Paper 2017 64 | P a g e

 $5,400.0mn from the CAF;  Expected receipts for royalties of $675.2mn;

 Expected receipts of $407.1mn from a profit share agreement;  Dividend distribution from public bodies of $21,535.6mn; and

 Expected increases in pension contributions of $2,931.0mn arising from the new pensions system.

For FY 2017/18, there will be limited payments of the Bauxite Levy based on the new agreements with the owners of Alpart and Noranda. These agreements reflect a temporary change in taxation regime for the bauxite sector wherein the companies will make payments based on arrangements specific to each.

Capital Revenue is budgeted at $2,228.1mn, which is significantly above the projected receipts for FY 2016/17 due primarily to a loan repayment to the GOJ from a public entity while Grants are forecast at $4,352.1mn, a decline of 25.1% below receipts in FY 2016/17. There are no Budget Support flows from the European Union (EU) programmed for FY 2017/18.


The borrowing requirement of the Central Government for FY 2017/18 amounts to $159,612.0mn. Of the budgeted Loan Receipts, $89,000.0mn is programmed to be raised domestically and $70,612.0mn is to be raised externally, inclusive of project/investment loans of $31,078.0mn. This borrowing requirement represents a 56.6% increase in total Loan Receipts when compared to FY 2016/17. The higher borrowing (year-over-year) requirement reflects the significantly higher Amortization costs for FY 2017/18.


Effective April 1, 2017, a new definition of Public Debt will become effective. Public Debt will be defined as the consolidated debt of the Specified Public Sector (SPS) net of the cross-holdings of debt, except that of the Bank of Jamaica. The SPS consists of the Public Sector, excluding any public body certified by the Auditor General as primarily carrying out functions that are of a commercial nature.


The Overall Balance of the group of Self-financing Public Bodies is projected at a surplus of $1,705.4mn for FY 2017/18. Net flows from Public Bodies to GOJ are projected at $33,511.6mn, resulting from $56,944.0mn Transfers to GOJ and Transfers from GOJ of $23,432.4mn. The flows from Public Bodies to GOJ include SCT from Petrojam, corporate taxes, grants to support special programmes as well as financial distributions (dividends). Public Bodies benefitting from GOJ transfers include NROCC and RMF - loan repayments, Students Loan Bureau (SLB) – support from Education Tax and JUTC for which the amount represents spare parts and fare subsidy.

June 12, 2021

Page 99

Ministry of Finance and the Public Service Fiscal Policy Paper 2021 Page 99

Monetary Policy The Bank+of+Jamaica">Bank of Jamaica Act outlines that the Bank">Central Bank should maintain a Reserve Fund consisting of net profits transferred at the end of each fiscal year. When the fund exceeds the Bank’s authorised capital, the excess should be transferred to the Consolidated Fund. Likewise, if the Bank realises net losses exceeding the amount held in the Reserve Fund at the end of the Bank’s fiscal year, the excess is to be paid to the Bank from the Consolidated Fund. The operations of the Bank">Central Bank therefore entail upside and downside risks.

Government Policy Changes

Government policy changes have the potential to adversely impact both revenue and expenditure and ultimately key fiscal targets, in the absence of compensatory measures.

Source: MOFPS Economic Growth GDP growth is one of the key macroeconomic indicators that inform revenue forecasting. As such, growth deviations from expectations can have significant effects on baseline revenue and by extension, fiscal outcomes. Figure VII (a) and Figure VII (b) below show the difference between growth projections and actual outturns for both nominal and real GDP over the period FY 2016/17 to FY 2019/20, and estimated outturns for FY 2020/21. Actual GDP growth has generally fallen short of projections as suggested by the various negative forecast errors. For FY 2020/21 nominal GDP growth and real GDP growth are estimated at -8.2% and -11.6% respectively, resulting in forecast errors of - 7.1 and -6.5 percentage points. This significant deviation was as a result of the onset of the COVID-19 pandemic in March 2020, which resulted in a slowdown of economic activity from the closure of industries such as tourism and entertainment. Figure VII (a): Nominal GDP Projections vs. Actual Outturns

Source: MOFPS Note: Projections and actual outturns are read in percentage (%) and forecast errors are read in percentage points (pp).

Figure VII (b): Real GDP Projections vs. Actual Outturns

Source: MOFPS Note: Projections and actual outturns are read in percentage (%) and forecast errors are read in percentage points (pp).

Real GDP growth for FY 2021/22 is projected at 5.2%. The fan chart in Figure VII(c) captures the level of uncertainty surrounding the medium term projections for real GDP growth. For






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June 12, 2021

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Medium-Term Debt Management Strategy FY2020/21-FY2023/24 11 | P a g e

existing floating-rate debt and fixed-rate debt that falls due within 12 months and needs to be

rolled over.

Figure 4 highlights a downward trend in benchmark interest rates for the debt portfolio during

calendar year 2019. The BOJ reduced its policy rate four times, from 1.75 percent to its current

level of 0.50 percent per annum. This monetary easing was geared towards stimulating the

expansion of private sector credit in order to spur a higher level of economic activity. In an effort

to mitigate the potentially negative effects on the US economy from increased geopolitical

tensions, rising trade uncertainty and slowing global growth, the Fed reduced its policy rate three

times, cumulatively by 75 basis points (bps) during calendar year (CY) 2019. The policy actions

of both monetary authorities resulted in downward trends in the 3-month Treasury bill (T-bill)

rate and the 3-month US dollar Libor (see Figure 4). The 3-month T-bill rate was 1.32 percent in

December 2019, 95 bps lower than January 2019. This compared to an 87 bps reduction in the

3-month US Libor to 1.91 percent at end-December 2019.

Figure 4: Reference Rates for the Debt Portfolio

Source: Bank of Jamaica and the Federal Reserve Bank of St. Louis

There was general improvement in the portfolio’s exposure to interest rate risk, reflected in

increases in the average-time-to-re-fixing (ATR) and debt re-fixing within one year. The ATR

measures the weighted average time until all principal payments in the debt portfolio become

subject to a new interest rate. Over the review period, the ATR for Central Government debt

portfolio increased by 1.3 years from 8.5 years at end-March 2019 to 9.8 years at

end-December 2019. This was as a result of a 0.4 year and 1.8 years increase in the domestic and

external debt portfolios, respectively.








Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jun-19 Jul-19 Aug-19 Sep-19 Oct-19 Nov-19 Dec-19

BOJ policy rate Eff Fed Rate 3-month T-bill 3-month US-Libor

June 12, 2021

Page 29

Section I. Instruction to Bidders 25

Bidders are not required to submit National Contracts Commission (NCC) and Tax Compliance Certificates (TCC) at the time of bid submission. However at the award of contract, bidders will be required to

a. be registered with the Bank of Jamaica

b. submit a valid Tax Compliance Certificate (TCC).

5.5(a) The minimum required annual volume of Services for the successful Bidder in any of the last ten years shall be $10,000,000.00

5.5(b) The experience required to be demonstrated by the Bidder should include as a minimum that he has executed during the last 3 years the following:

At least two (2) contracts for Provision of credit card payment services

5.5(c) The essential equipment to be made available for the Contract by the successful Bidder shall be

swipe cards.


5.5(e) The required number of years Audited Financial Statements to be submitted shall be Two(2) years:



5.5 Subcontractors’ experience shall be taken into account.

B. Bidding Data

9.2 The number of identical copies of the Bid to be completed and returned shall be One (1) original and one (1) copy.

B. Bidding Data

10.1 Clarification of bids: Request for clarification must be done in writing no later than June 5, 2018. The final date for response to bidder’s clarification request is June 11, 2018.

C. Preparation of Bids

12.1 Language of the bid is: English

13.1 The additional materials required to be completed and submitted are:

 Two Client References from previous implementations of similar nature (please see form attached).

June 12, 2021

Page 4


The consultant is required to, utilizing best practice, develop the structure, templates

and drafts for the Public Investment Performance Report. The report will contain a

review of the public investment portfolio of the GOJ to include the central government,

Self-Financed Public Bodies and Public Private Partnerships under the purview of the

DBJ. The report will include an examination of ;

 Sectoral and functional classification of existing and planned investment


 Alignment of existing public investments with the long term national

development plan and medium term socioeconomic policy objectives;

 Trends in total public investment

 Efficiency and impact of public investment

 Actions taken to improve GOJ’s public investment management capacity

 Overview of the institutional performance along the project cycle including an

assessment of investment planning, investment allocation, investment

implementation, monitoring and evaluation

 Provide a review of the policy that guided the investments for the reporting

period to determine alignment to and variation from the policy and the resulting

outputs and impact;

 Include standard metrics to compare annual portfolio performance and sector


 Status of PIMSEC Project Pipeline

 Status of DBJ’s PPP Pipeline

The consultant will be required to have consultations with key stakeholders in the process to include:

Ministry of Finance and the Public Service  Public Investment Management Secretariat  Planning Institute of Jamaica  Specified Public Sector entities  Development Bank of Jamaica  Cabinet Office  Donor Agencies

June 12, 2021