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Poor’s and Fitch to CCC and CC, respectively. The main reason for the slightly upward revision was the consent from bondholders to restructure the amortization schedule of Suriname’s four - year US$125 million 2023 bond. So the Opposition Spokesman chided the government for spending less than our CARICOM neighbor that ended up defaulting on its debt with inflation skyrocketing from 4.2% to 40% in eight months. Well, indeed, that is a choice. But that is not a choice the Jamaican people want its Government to make. Madam Speaker, one-dimensional analysis cannot cut it. Especially one dimensional analysis that relies on faulty data. The Opposition Spokesman relied on provable erroneous data. I say in humility, recognizing that we are fallible, that bad data, wrong data leads to false narratives and bad policy Madam Speaker.

3.2 Food Poverty Another problem is that the Opposition Spokesman compounded the error by using the faulty data on comparative fiscal spend to make other assertions. Madam Speaker, the Opposition Spokesman on Finance built much of his presentation around food poverty and compared Jamaica regionally in an unfavourable way, and of course blamed the Government. First, Madam Speaker, I took the opportunity to read the report6 he quoted from which is a standard publication of the US Department of Agriculture that uses quantitative techniques to estimate levels of food poverty in 76 low and middle- income countries. I did not simply look at the table in the report. The report describes the methodology that the authors use to derive their results. The first important thing to note is that the methodology is a theoretical quantitative model. It is based on numbers and formulae in a proverbial “spreadsheet” or model. They did not go to these countries to conduct actual surveys with actual people. As STATIN does, they did not come to Jamaica to measure food poverty by visiting households here. They took pre-COVID-19 macro data and incorporated per capita income, the size of the GDP contraction that each country is projected to experience, the impact of this on per capita income, and several other variables and, with a quantitative model, used that to project, theoretically, how that affects food poverty. Here is how they describe their methodology7:

6 United States Dept of AgricultureEconomic Research Service. Covid 19 Working Paper – Covid 19 Updates and Impacts on Food Security – published January 2021 7 Page 4, United States Dept of AgricultureEconomic Research Service. Covid 19 Working Paper – Covid 19 Updates and Impacts on Food Security – published January 2021

June 12, 2021

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“How Was the Study Conducted The 2020 IFSA report incorporated initial estimates of income shocks from the COVID-19 pandemic as presented in the International Monetary Fund’s World Economic Outlook (WEO) report of April 2020 and compared them with projections from the ERS International Macroeconomic Data Set (IMDS) published in January 2020, which represents the pre-pandemic scenario. In early September 2020, ERS produced an unpublished update to its IMDS estimates, incorporating the best available information on the anticipated decline in GDP in 2020 and potential recovery in 2021. The updated IMDS estimates use data from IHS Global Insight, Oxford Economic Forecasting, as well as estimated and projected values developed by ERS. We used the newly updated GDP information from the IMDS September update to re-estimate the COVID-19 impacts on food security for 2020 and 2030 presented in the 2020 IFSA report.” (emphasis added) So contrary to how the Opposition Spokesman used the data from the study – to somehow imply that this measurement was after the CARE Programme, and therefore an assessment of its adequacy is, again, a provably inaccurate claim. The study used “spreadsheets” taking as input GDP contraction and implied theoretical levels of food poverty. If GDP contracts by 12%, then food poverty will rise by x% through some complex multivariate model. That is it. These are not direct measurements of real people in Jamaica or anywhere else and the report does NOT consider the impact of policy. The last direct measurement of poverty that was done of real people in Jamaica by STATIN, showed that poverty declined to the lowest levels in 12 years under the Andrew Holness administration. That was a direct measurement. However, back to the theoretical study introduced into this debate by the Opposition Spokesman. Am I discarding it because it is theoretical and does not result from direct measurement No. Not at all. It has its value and use. But to use this study to weigh the Government’s response to the COVID-19 pandemic is a gross misapplication of the report. But let us examine this report that the Opposition Spokesman has relied on so much in his thesis. Here is what the same food poverty report introduced by the Opposition Spokesman on Finance says, that I do not recall him highlighting: 1/ Of the countries surveyed, theoretically estimated food poverty in Jamaica is the lowest in Latin America and the Caribbean pre-COVID-19 and post-COVID-19 with the only exception of Columbia and Dominican Republic, both of which have higher average incomes than Jamaica.

June 12, 2021

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Section I. Instruction to Bidders 37

Bid Security (Bank+Guarantee">Bank Guarantee)

[The Bank shall fill in this Bank+Guarantee">Bank Guarantee Form in accordance with the instructions indicated.]


Beneficiary: ___________________

Date: ________________

BID GUARANTEE No.: _________________

We have been informed that ___________ (hereinafter called "the Bidder") has submitted to you its bid dated (hereinafter called "the Bid") for the execution of __________ under Invitation for Bids No. __________ (“the IFB”).

Furthermore, we understand that, according to your conditions, bids must be supported by a bid guarantee.

At the request of the Bidder, we __________ hereby irrevocably undertake to pay you any sum or sums not exceeding in total an amount of _________ (_________) upon receipt by us of your first demand in writing accompanied by a written statement stating that the Bidder is in breach of its obligation(s) under the bid conditions, because the Bidder:

(a) has withdrawn its Bid during the period of bid validity specified by the Bidder in the Form of Bid; or

(b) having been notified of the acceptance of its Bid by the Procuring Entity during the period of bid validity, (i) fails or refuses to execute the Contract Form; or (ii) fails or refuses to furnish the performance security, if required, in accordance with the Instructions to Bidders.

This guarantee will expire: (a) if the Bidder is the successful bidder, upon our receipt of copies of the contract signed by the Bidder and the performance security issued to you upon the instruction of the Bidder; or (b) if the Bidder is not the successful bidder, upon the earlier of (i) our receipt of a copy of your notification to the Bidder of the name of the successful bidder; or (ii) twenty- eight days after the expiration of the Bidder’s Bid. Consequently, any demand for payment under this guarantee must be received by us at the office on or before that date. This guarantee is subject to the Uniform Rules for Demand Guarantees, International Chamber of Commerce Publication No. 458. _____________________________ [signature(s)]

June 12, 2021

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And Mr. Robinson’s 2016 prices are well below which leads to gross over estimation of what he projects the increases between 2016 and 2021 to be. His 2016 prices for tin mackerel, corned beef, milk powder, cooking oil and rice differ from the prices in the Consumer Affairs Commission database across multiple outlets in Jamaica by a significant degree. Now if you say cooking oil cost $85 in 2016 and $220 in 2021 then of course you get a 159% increase as the Opposition Spokesman erroneously reported. But if cooking oil prices were actually closer to $200 in 2016 then you get a very different number – the actual increase – of 16% or 3% per year. 159% versus 16% Madam Speaker. 30% per year increase vs 3% per year Madam Speaker. And similarly for other items quoted. The Opposition Spokesman 2016 prices are not credible, they are significantly underestimated and his percentage increases are grossly exaggerated. Hastag Not Credible. The Opposition knows very well that it is highly irresponsible to rely on price data from a single source to make economic policy or to pronounce on policy. If that were acceptable then we could do away with STATIN, do away with the Consumer Affairs Commission and the finance minister would just make policy based on walking into a single shop the weekend before the budget presentation. Policy-making requires collection of objective data in a scientific way. Madam Speaker, prices have increased. We know that. We also know that the average is not everyone’s experience. By definition, depending on where they shop some will experience above average increases and some below average increases. The key is to have accurate timely information that will aid decision making. At the first opportunity we will allocate additional resources to the Consumer Affairs Commission to ensure they can publish and disseminate their work more widely – whatever the result – so that citizens will be informed and the space for the weeds of misinformation to take root will not exist. While I believe the Opposition Spokesman may have had sincere intent, the impact of the gross and irresponsible exaggeration of price increases breeds fear. And we will not allow anyone to inadvertently plunder and prey upon the fears of the people. Knowledge drives away fear.

June 12, 2021

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Knowledge is power Madam Speaker, and the media, financial journalists, commentators, those watching on television and following on social media should be familiar with thereby narrowing the opportunity for the weeds of misinformation and the thorns of whipped up fear to thrive. So if depreciation leads to foreign exchange gains, which, in turn explain BOJ dividends, “just so”, I want to share you the BOJ’s foreign exchange gains of the past and ask where were the dividends paid over to the people of Jamaica. Madam Speaker, the audited financial statements of the BOJ show, that between 2000 and 2007 and between 2012 and 2016, eleven years when the PNP was in power, according to Mr. Golding’s analysis, the Bank of Jamaica enjoyed foreign exchange gains of approximately US$728 million. Let me say that again. I want to ask where were the dividends paid over to the people of Jamaica Madam Speaker, US$728 million converted today J$ is $107 billion. I want to know … Where are the dividends And I am just talking about 11 of the 18 years. I have not even touched the most devastating parts – the 1990’s. Madam Speaker, as a percentage of GDP in each of those 11 years, 2000 – 2007 and 2012 – 2016, the Foreign Exchange gains of BOJ under the PNP cumulatively amounted to a massive 6% of GDP….that is the budget to educate 500,000 Jamaican students in a year. I want to know, the children of Jamaica want to know – where are their dividends US$727 million or $107 billion of foreign exchange gains, under them Madam Speaker in today’s money, and not one red cent of dividend….. …Absolute Zilch to the people of Jamaica. And when we, due to good policy, are able to fund a $60 billion SERVE Jamaica Programme, with a historic, largest ever, $33 billion dividend to the people of Jamaica, from central bank profits, he wants to complain Madam Speaker, they say, “when you live in a glass house don’t throw stone!” And it is quite evident Madam Speaker, that if even if you sprinkle a little Golding dust on it, it is still only a glass house. Madam Speaker, the fact is that the Bank of Jamaica has two sources of operating income – interest income and foreign exchange earnings including realized and unrealized foreign exchange gains. The vast majority of its revenues have always been from interest income.

June 12, 2021