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Leading by example

Jamaican Prime Minister, Bruce Golding, leading by example amid the impact of the global economic crisis on the debt-ridden island, announced Sunday April 5, 2009, he was taking a 15% pay-cut.

The Jamaican Prime Minister earns about U.S. $61,087 annually and after the pay-cut his salary descends to U.S. $53,119 (one U.S. dollar is worth $88.60 Jamaican).

In a nationwide address forty-eight hours before the presentation of the 2009/2010 budget, the Jamaican prime Minister told the debt-ridden nation (Jamaica's debt to GDP ratio at nearly 140% is one of the world's highest) also asked his parliamentarians to take a ten percent cut in salary.

Golding also announced a wage freeze for thousands of government workers, noting that the alternative would have been massive job cuts.

The payroll for Jamaican government workers at U.S. $1.1 billion, except for debt servicing, is the single biggest expenditure item on the island's budget.

The Jamaican economy has been hit hard by the global financial crisis.

Its two main earners, tourism and bauxite mining have experienced significantly decreased earnings, job losses and plant closures in the case of bauxite mining.

The island's credit rating has also been downgraded by international credit ratings agencies such as Moodys and Standard and Poors.

Amid the loss of earnings by key sectors of the Jamaican economy, government revenues have fallen precipitously.

For example during the period April 2008 to February 2009, the Jamaican government's projected revenues fell by 21 billion Jamaican dollars (one Jamaican dollar is worth U.S. $0.011) or about 12 percent.

Consequently during the period, the island's fiscal deficit swelled to $69 billion Jamaican.

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