By Anthony Henry

Jamaica’s recent general election is not expected to trigger any significant shifts in the country’s economic or fiscal policy direction, according to Fitch Ratings.

The agency noted that both major political parties share a broad consensus on the macroeconomic framework, anchored on debt reduction and inflation targeting.

Prime Minister Andrew Holness and the Jamaica Labour Party (JLP) secured a third consecutive term in the September 3 polls, winning 35 of 63 parliamentary seats, compared with 28 for the opposition People’s National Party (PNP). Despite the slimmer majority, 15 seats fewer than in the last Parliament, Fitch emphasised continuity, saying that policy deviations were unlikely regardless of which party prevailed.

“The Positive Outlook on Jamaica’s ‘BB-’ sovereign rating reflects our expectation that debt metrics will continue to improve and the policy framework will strengthen further over the next few years,” Fitch said.

Holness’ campaign leaned heavily on his government’s record of fiscal prudence, which has helped reduce debt and improve market confidence in recent years. Jamaica’s Independent Fiscal Commission, which began operations in January, is expected to add further credibility to fiscal oversight.

Fitch projects that Jamaica’s general government (GG) debt-to-GDP ratio will fall to 59% in 2027, meeting the government’s 60% target one year ahead of schedule. That would represent a 10 percentage point decline from 2024 levels. The agency, however, cautioned that there is no clarity yet on fiscal targets beyond 2027, which could affect the long-term policy anchor.

While primary surpluses are expected to moderate in 2025 and 2026, they should remain above 3% of GDP. The agency noted that pressures to increase spending, particularly in infrastructure and tax relief, could slow the pace of fiscal consolidation, but strong adherence to fiscal rules suggests discipline will be maintained.

Jamaica’s economy has shown resilience following disruptions from Hurricane Beryl in July 2024 and heavy rainfall that year. GDP growth resumed in the first quarter of 2025 and accelerated in the second quarter, while inflation remains near the midpoint of the 4%–6% target range.

Fitch said it will update its macroeconomic forecasts for Jamaica in its quarterly Sovereign Data Comparator later this month.

Despite progress, Jamaica continues to face deep-seated structural constraints, including high crime, low productivity, weak demographics, and exposure to external shocks. Fitch said these factors weigh on the country’s growth potential and sovereign rating.

Holness’ third term places him among a small group of Jamaican leaders to have won three or more consecutive elections, the last being PJ Patterson of the PNP, who served from 1992 to 2006.