Receipt from multilateral loans contribute significantly to hike

The Bank of Jamaica (BOJ) is reporting that the country’s Net International Reserve (NIR) grew by US$303.15 million during the one-month period February to March 2021.

The BOJ reports that the NIR at the end of last month was US$3.31 billion, coming from US$3.01 billion the month before in February. The NIR now represents an improvement of two weeks in the estimated value in terms of the purchase goods and services imported into the country.

It now stands at 38.71 weeks of imports coming from 36.44 weeks in February 2021. The buildup in the NIR comes against a huge selloff of US dollars by dealers in the market between January and March.

Loan receipts propped up Jamaica’s NIR

However, it is understood that the bulk of the increase for last month did not come from normal inflows but from government-related receipts. News reports say the NIR was propped up by approximately US$217 million from receipts coming from multilateral institutions.

Of this amount, some US$175 million represented multilateral loan inflows from the World Bank and the Caribbean Development Bank. The remainder of the inflows is said to come from authorised dealers and cambios, under the Bank’s Surrender Arrangement.

Jamaica recorded a big surge in net remittance inflows of US$224.4 million in January 2021, representing a US$62.9 million jump or 39.0 per cent increase relative to January 2020 based on the latest results of Jamaica’s Remittance Bulletin.

The Remittance Bulletin for January 2021, which was published last Thursday by the BOJ showed that the surge resulted from an increase in gross remittance inflows of 32.7 per cent or US$59.4 million complemented by a decline of 17.3 per cent or US$3.5 million in outflows.

The increase in gross remittance inflows stemmed from a 36.8 per cent hike in inflows via remittance companies as well as an increase in other remittances of 5.2 per cent for January.

Net remittance inflows for January totaled US$2.39 billion, up by US$589.0 million or 32.5 per cent more relative to the previous corresponding period. This improvement resulted from an increase of 27.0 per cent or US$548.3 million in total remittance inflows further aided by a fall off of 18.4 per cent or US$40.7 million in total remittance outflows.