UPDATED: Clarke oversaw rise in GDP
Published:Tuesday | August 27, 2024 | 12:11 AM
Finance Minister Dr Nigel Clarke arguably recovered the Jamaican economy from shocks faster than his predecessors, but poverty increased over the pandemic-recovery period.
“Jamaica is one of the few countries that have recovered from the fiscal wreckage brought on by the pandemic. By consolidating public finances and actually lowering debt,” stated the International Monetary Fund during a 2023 podcast.
During the pandemic the microeconomy arguably suffered. The prevalence of poverty moved to 16.7 per cent in 2021or 5.7 percentage points higher relative to 2019. That’s from Government data in the Economic and Social Survey Jamaica 2023 published by the Planning Institute of Jamaica which falls under Clarkes’s finance ministry portfolio. The poverty rate for 2023 has not yet been determined.
Clarke will in October take up his new remit as a deputy managing director at the International Monetary Fund (IMF).
His departure comes at a juncture following the passage of Hurricane Beryl, a new shock that authorities expect could result in the island’s first gross domestic product (GDP) decline since 2020. The Bank of Jamaica (BOJ) expects the economy to lose up to 1.5 per cent on the low end in 2024, but gain 0.5 per cent on the high end.
Clarke succeeds Antoinette Sayeh, a former Liberian finance minister, who demits office on September 12. Former chair of the IMF, Dr Sidi Jammeh, described Clarke’s appointment as one of merit.
“Nigel Clarke, for your appointment as deputy managing director of the premier financial institution of the world, th recognition is most deserved,” stated Jammeh on online platform, Linkedin.
Jammeh also issued “kudos” to IMF Managing Director Kristalina Georgieva for “helping pick a suitably qualified and experienced candidate from the Global South” for this appointment, “solely on the basis of merit”.
Rolande Pryce, regional head of the South Caucuses at the World Bank, labelled the appointment as a friendly coup.
“Well done, Kristalina. Such a coup for the IMF! He has made Jamaica proud. He will be an incredible asset to your team,” stated Pryce on Linkedin.
The macroeconomy lost 10 per cent of its value arising from the pandemic, which equated to the largest drop among shocks going back to the 1970s, Clarke told reporters earlier in the year.
His approach was not characterised by rapid or spectacular gains, but by steady, incremental improvements that built a foundation for long-term stability.
“Clarke’s commitment to macroeconomic stability and fiscal responsibility has been instrumental in Jamaica’s successful completion of its IMF programme,” the IMF stated in previous releases.
Another achievement of Clarke’s tenure was the reduction of Jamaica’s debt-to-GDP ratio by one-third from 110 per cent of GDP in 2020 to 72 per cent in 2023. In addition to managing the national debt, Clarke also focused on reforming Jamaica’s tax system, making it more efficient and equitable. His efforts to widen the tax base and reduce evasion were key factors in increasing government revenues without overburdening the average Jamaican.
“We are in unique company who can say that economic recovery, jobs recovery, in addition, debt is lower today than prior to the pandemic,” stated Clarke in a IMF podcast last year.
EDITOR'S NOTE: A previous version of this article incorrectly stated that the prevalence of poverty moved to 16.7 per cent in 2023.