Jamaica has reached a historic low in its public debt-to-GDP ratio, a vast feat in fiscal management. The ratio fell to 74.2 per cent in the 2023-24 financial year, the lowest in over two decades, reflecting over a decade of fiscal consolidation measures.

This record, achieved by reducing public debt by more than 60 percentage points since 2013, highlights the government’s efficacy in macroeconomic stability.

According to the World Bank, prudent management strategies, including inflation-targeting monetary policies, have helped the nation navigate multiple economic shocks. Despite these efforts, Jamaica’s growth remains among the slowest in the Latin America and Caribbean region. The economy is hampered by low productivity growth, limited diversification, and a business environment constrained by high connectivity costs, inadequate digital infrastructure, and crime.

Earlier this year, former Finance Minister Nigel Clarke said that by the end of April 2025, the country’s debt could be as low as 64 per cent of GDP, which will be the lowest debt since 1976.

“We are proud of our commitment and successful effort to reduce the debt ratio to the lowest level in 30 years, and next year the lowest level in 50 years. We are managing the government finances so that we don’t materially increase the size of the debt while we grow the economy and the debt doesn’t become a threat,” he added.

A Brief Probe Of Jamaica’s Growth Hitherto

In 2023, the Jamaican economy grew by 2.6 per cent, buoyed by mining and a continued recovery in tourism. However, agriculture suffered from an extended drought, and Hurricane Beryl in July 2024 caused an estimated $67 million in damages, affecting agriculture, utilities, construction, and tourism. The hurricane’s impact drove inflation to 6.4 per cent year-on-year in August 2024, despite an overall easing trend earlier in the year.

Food insecurity remains a pressing issue, with a Caribbean Food Security and Livelihoods Survey indicating that one-third of respondents went without food for an entire day in April 2024.

While unemployment dropped to a low of 5.4 per cent in early 2024, now at 4.2 per cent, informal employment persists, with nearly half of non-agricultural jobs lacking formal structures. Poverty also declined, with the share of Jamaicans living below the US$ 6.85 per day poverty line falling to 12.3 per cent in 2023 from 13.9 per cent in 2021, likely due to employment growth.

The nation’s heavy reliance on tourism and agriculture makes it highly vulnerable to external shocks, including climate-related events. The World Bank suggests the combined challenges of limited innovation, human capital constraints, and learning disruptions from the pandemic could have long-term impacts on growth.