Analysis Of The Documentary ' Life And Debt '

984 WordsSep 26, 20154 Pages
INTST: Reaction Paper Life and Debt Troy Wefers October 1, 2015 In the documentary Life and Debt, it is explained through the stories of local people, the economic and social crisis of Jamaica. With Jamaica receiving mandatory loans from the International Monetary Fund (IMF) in 1977 because of lack of alternatives, Jamaica was promised meaningful development. Unfortunately, this only made the situation worse because of the extreme policies and foreign economic agendas that came with the loans, forcing Jamaica into even further debt. Therefore, it is my opinion that it is because of the policies and greed of the IMF and The World Bank that came along with the loans, that Jamaica is currently 4.5 billion dollars in debt. One of the first changes made by the IMF after instituting Jamaica a loan was the devaluation of the Jamaica currency. Even though the devaluation of the currency made exports from Jamaica cheaper to purchase, Jamaica is a country that relies on imports to survive, and devaluation makes imports extremely expensive. This then decreased the amount that Jamaica could import, and with already decreased government spending, Jamaica could not sustain itself with enough goods. Two other changes that were made by the IMF are wage guidelines and high interest rates. Wage guidelines reduce the cost of labour, which was done as an incentive to hire more workers and in turn have more production. High interest rates are supposed to reduce domestic

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