Jamaica Returns to International Capital Markets with US$1Bn Bond Issue

• The Government of Jamaica (GOJ) has returned to the international capital markets with a 6.25% US$1Bn unsecured bond issue due in 2037, as part of a broader strategy to restructure external debt, extend maturities and provide additional financing for the 2026/27 Budget. Approximately US$600Mn of the proceeds will finance a tender and exchange offer for existing global bonds, while the remaining US$400Mn will be available for general budgetary purposes.
• The GOJ simultaneously launched an offer to repurchase portions of three outstanding international bonds with a combined face value of approximately US$2.33Bn. These include US$837.53Mn of notes due in 2028 carrying a 6.75% coupon, US$250Mn due in 2036 at 8.50%, and US$1.24Bn due in 2039 at 8.00%. The initiative forms part of Jamaica’s broader programme to proactively manage its external public debt.
• The tender opened on September 2 and was scheduled to close on September 9, with settlement expected by September 17. The transaction is intended to reduce refinancing risks by replacing portions of existing debt with a new instrument carrying a longer maturity.
• The latest borrowing comes amid weaker-than-budgeted fiscal performance during the opening months of 2026/27. Central government revenue and grants for April to July amounted to US$2.23Bn, 8% below budget, while tax collections were approximately US$134.5Mn below projections. Consequently, GOJ recorded a fiscal deficit of roughly US$210.9Mn, compared with a budgeted deficit of US$194.9Mn, although stronger loan receipts provided support to overall financing.
• The prospectus highlighted continuing economic risks following Hurricane Melissa, geopolitical conflicts and volatility in international energy markets, which could affect growth, inflation and government revenues. Nevertheless, tourism remains an important source of foreign-exchange support, with 2.34Mn visitors generating US$2.5Bn through August 2026.
• Against regional borrowing benchmarks, Jamaica's 6.25% 2037 notes are priced broadly in line with Trinidad and Tobago's recent 6.20% 2038 and 6.50% 2036 issues. Notably, Trinidad and Tobago holds an investment-grade rating of BBB-/Negative from S&P, compared with Jamaica's BB/Stable rating, while Moody's rates both sovereigns Ba2/Ba3, respectively, with Stable Outlooks. The relatively narrow coupon differential, despite Jamaica's lower credit rating and non-investment-grade status, suggests favourable investor confidence in Jamaica's fiscal consolidation and debt management efforts. Overall, the transaction, along with the tender and exchange offer, supports efforts to reduce refinancing risk and proactively manage Jamaica’s public debt.

(Sources: Caribbean Council & NCBCM Research)