Jamaica Upgraded by Fitch on Primary Surplus, Lower Debt

• Jamaica’s long-term foreign and local currency rating was upgraded to B+, with a stable outlook,  on large primary surpluses that have cut the debt-to-GDP ratio, Fitch said in a statement.

 

• Jamaica primary surplus one of the largest of any sovereign rated by Fitch at 7% of GDP in FY2018; primary surplus has been above 7% since FY 2013. Strong growth in global consumption tax has driven growth in revenues as spending on infrastructure increased

 

• The debt burden is on a downward path but still compares unfavorably to the current ’B’ median of 60.7% of GDP. The fiscal stance is being guided by a fiscal rule that aims to reduce debt to 60% of GDP by FY2025.

 

• Economic growth to accelerate to 2% in 2019 and 2020 from 1.8% in 2018. Growth is low relative to B-rated peers but has picked up on construction, road infrastructure, rising tourist arrivals and reopening of an alumina refinery

 

(Source: Bloomberg)