Country Report Jamaica
- ID: 2105438
- October 2015
- Region: Jamaica
- 24 Pages
- The Economist Intelligence Unit
Jamaica passed its ninth consecutive review under its IMF Extended Fund Facility (EFF) in late September, allowing the country to receive an additional US$40m under the lending programme.
An IMF statement noted that although macroeconomic fundamentals continue to strengthen, growth remains sluggish. As a result, the Fund revised its GDP growth forecast for the 2015/16 fiscal year (April-March) to 1.4% , down from 2% previously; this is roughly in line with our 2015 calendar-year GDP growth projection of 1.3%. The economy expanded by 0.4% year on year in the first quarter, and by 0.6% in Q2, according to the Statistical Institute of Jamaica (Statin), driven largely by increased mining output and strong tourism arrivals. Lower oil prices will also boost growth by increasing disposable incomes, although the impact of an ongoing drought will act as a drag.
The Fund again urged the government to undertake structural reforms, including reducing electricity costs, improving the business environment and developing critical infrastructure. It also urged the government to focus on reducing the high unemployment rate (currently 13.2%).