Financial Sector Reform in Jamaica During 1985-1992, Possible Lessons for the Caribbean

Author/Editor:

Dewitt D Marston

Publication Date:

September 1, 1995

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary:

This paper reviews the Jamaican experience with indirect instruments and contrasts this with the currency board type arrangements of the common currency area governed by the Eastern Caribbean Central Bank (ECCB). Reforms in Jamaica improved intermediation and banking efficiency, but a weak fiscal position and interest rate caps undermined the effectiveness of indirect instruments in attaining monetary control. The apparent stability amongst members of the currency union may mask fiscal pressures. In most Caribbean countries, problems of quasi-fiscal pressures on money supply, and disintermediation due to some regulation, are evident. Resolving these issues are necessary to facilitate the reforms being pursued.

Series:

Working Paper No. 1995/090

Subject:

Banking Central banks Credit ceilings Currencies Foreign exchange Monetary policy Money Open market operations Reserve requirements

English

Publication Date:

September 1, 1995

ISBN/ISSN:

9781451851366/1018-5941

Stock No:

WPIEA0901995

Pages:

32

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