VZCZCXRO2806
RR RUEHGR
DE RUEHKG #0705/01 1311640
ZNR UUUUU ZZH
R 111640Z MAY 07
FM AMEMBASSY KINGSTON
TO RUEHC/SECSTATE WASHDC 4745
INFO RUCNCOM/EC CARICOM COLLECTIVE

UNCLAS SECTION 01 OF 02 KINGSTON 000705 
 
SIPDIS 
 
SIPDIS 
 
STATE FOR WHA/CAR (BUDDEN), WHA/EPSC (SLATTERY) 
 
E.O. 12958: N/A 
TAGS: ECON EFIN JM
SUBJECT: JAMAICA: BUDGET DEBATE PRESAGES UPCOMING ELECTIONS 
 
 
This message is sensitive but unclassified, please handle 
accordingly. 
 
¶1. (U) Summary: Each year, the budget debates captivate 
Jamaicans as each party presents its vision for the country, 
thinly veiled as a presentation of the budget for the fiscal 
year.  With elections due to be called by October 2007, this 
year was expected to be particularly grandiose.  The 
opposition Jamaica Labor Party (JLP) emphasized job creation 
under the slogan "Is it time for a change?" while the ruling 
People's National Party (PNP) made generous promises without 
specifying how they would be financed.  End summary. 
 
--------------------------- 
Opposition on the Offensive 
--------------------------- 
 
¶2. (U) The leader of the opposition Jamaica Labor Party, 
Bruce Golding, set out a budget that was designed as an 
election manifesto.  It showed a clear grasp of the key 
challenges facing the country, but more importantly spoke 
directly to the urban and rural poor, a group that the JLP 
has failed to capture in the past. 
 
¶3. (U) Golding made much use of Jamaican patois, a common 
tactic among politicians looking to appeal to the poor 
demographic.  Typically, the JLP is seen as the party of the 
middle-class intelligentsia, less populist than the ruling 
People's National Party.  Knowing that he has their vote 
secured, Golding wanted to move beyond this constituency.  In 
a similar vein, he quoted several times from the Bible and 
popular song lyrics, employing a trademark tactic of Prime 
Minister Portia Simpson Miller (PSM). 
 
¶4. (U) Golding's speech also hammered the record of the PNP, 
which has been in power for 18 years.  He drew a grim picture 
of life under PNP rule, noting that in the ten years from 
1997, Jamaica had grown by a total of only 9.6 percent - only 
Haiti has suffered a more anemic rate.  He mocked the 
official government statistics claiming that the unemployment 
rate in Jamaica was below 10 percent.  "If you define healthy 
people as those who don't have polio, then you can declare 
almost everyone in Jamaica to be healthy," he said, 
referencing the government statisticians who count at least 
one hour per week of work to be "employed." 
 
¶5. (U) He used unemployment to segue into the major theme of 
his speech: job creation.  Under this rubric, he touched on 
the need for a revitalized agency to aggressively pursue 
foreign investment, an emphasis on education and training 
(specifically calling for an abolition of secondary school 
fees), and a specific national development plan similar to 
one developed by JLP eminence grise Edward Seaga in the late 
1960s, which set specific targets for investment in each of 
the 14 parishes in Jamaica. 
 
¶6. (U) Being a tour d'horizon of Jamaica, however, the speech 
was short on details of how his measures would be 
implemented, and in some areas presented a danger of 
contradiction.  For example, Golding noted Jamaica's debt 
burden and its pervasive crime, both of which stifle growth. 
But in the same speech he called for eliminating hospital 
fees for diagnostic services, abolishing secondary school 
fees, and injecting increased funds into the police force. 
Less clear was how he intended to fund such measures without 
the fiscal deficit skyrocketing.  His proposal to mechanize 
the ailing sugar industry to make it more efficient, also, 
conveniently neglected to address the issue of how such 
technology would displace thousands of workers on rural 
plantations. 
 
¶7. (U) As a piece of pre-election rhetoric, however, Golding 
achieved his objective.  Repeating what is sure to be the 
JLP's slogan on the campaign trail, "Is it time for a 
change?", Golding thrilled supporters in the gallery of 
Parliament. 
 
----------------------- 
Portia Rallies the Poor 
----------------------- 
 
¶8. (U) Prime Minister Portia Simpson Miller, by contrast, 
presented a poorly prepared, reactive budget.  As expected, 
it has been characterized in the media as a "bag of goodies" 
budget that was designed to woo voters with promises of 
handouts and benefits, without offering any new tax measures 
to pay for them.  It lacked a cohesive framework and vision, 
instead merely listing items that would be offered to the 
electorate. 
 
¶9. (U) Chief among these, and the one most closely 
 
KINGSTON 00000705  002 OF 002 
 
 
scrutinized in the days since her presentation, is the 
abolition of all hospital fees for persons up to the age of 
¶18.  It became obvious, however, that her flagship 
announcement had been hastily prepared after Golding's 
speech.  In a post-speech press conference, PSM was unable to 
explain which fees would be exempted, or any other details of 
the measure.  The next day, the Permanent Secretary from the 
Ministry of Health, Grace Allen-Young, admitted on national 
radio that she had received the directive to abolish hospital 
fees after Golding's speech. 
 
¶10. (U) That was not PSM's only treat, however.  She also 
promised: 
 
-- an increase in the National Housing Trust loan ceiling for 
the poor; 
 
-- the establishment of a new children's hospital in western 
Jamaica; 
 
-- a JMD 2 billion (USD 30 million) subsidy for housing for 
sugar workers; 
 
-- the extension of the "Highway 2000" toll road project; 
 
-- the construction of a convention center in Montego Bay 
that even Ministry of Finance officials conceded would lose 
approximately USD 1 million per year; and, 
 
-- the amendment of regulations that would allow more 
retirees to qualify for a state pension. 
 
There were no new tax regimes proposed. 
 
¶11. (SBU) PSM's promises, if they materialize, will carry 
enormous fiscal implications.  A Ministry of Finance 
official, Courtney Williams (protect), confirmed that few of 
the promises ) most notably the hospital fees ) had been 
factored into the actual budget, and thus there would have to 
be a revision of the estimate of the fiscal deficit.  He also 
admitted that he was "expecting a call at any moment" from 
International Monetary Fund officials, who had recently met 
with him to discuss the country's deficit.  He noted wryly 
that he was not looking forward to that call. 
 
¶12. (SBU) Nevertheless, PSM will have satisfied her core 
supporters - the poor - with her flamboyant populist style 
and lavish promises.  She also made much use of the pronoun 
"I" in an apparent attempt to separate herself from the 
party, which has become increasingly fractured and embattled 
(Post will report septel on PNP divisions).  Media analysts 
have noted that to win the election, PSM must make a clear 
distinction between herself (new and different) and the party 
(old, arrogant, and predictable). 
 
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Comment 
------- 
 
¶13. (SBU) This year's budget debate can best be seen as the 
two parties' early election manifestos.  Both contained 
promises of assistance and relief for the poor, whose votes 
will be the key to victory.  Sadly, however, the budgets bear 
no resemblance to reality, which will be revealed after the 
elections.  It seems that, this year at least, Jamaica is 
living up to its characterization by a former U.S. 
Ambassador, who noted that "Jamaicans applaud announcements, 
not implementation." 
Johnson