Jamaica was the subject of a glowing analysis last Friday in the Financial Times (FT), which described the country’s economic performance over the past 10 years as “arguably one of the most remarkable and radical but underappreciated turnaround stories in economic history”.

The article, written by Robin Wigglesworth, editor of the FT’s financial blog Alphaville, basically focused on the just-concluded International Monetary Fund (IMF) virtual mission to Jamaica, conducted as part of reviewing a precautionary credit line and completing the regular Article IV reviews of all members.

Wigglesworth’s article, headlined ‘The IMF’s fave pupil gets another gold star’, stated that “once again” the IMF’s assessment of the country that “came very very close to complete financial and economic collapse (and presumably subsequent social and political disaster) in 2012 “was glowing”.

He quoted the IMF report, which stated, “Over the last years, Jamaica has successfully reduced public debt, anchored inflation, and strengthened its external position. It has built a strong track record of investing in institutions and prioritising macroeconomic stability. This allowed Jamaica’s response to recent global shocks to be prudent, agile, and supportive of growth.”

Added the IMF, “The economy continued to recover in 2023. After two years of rapid post-pandemic recovery, GDP (gross domestic product) growth is projected at 1.7 per cent in FY2023/24, with tourism well above pre-pandemic levels and unemployment falling to a record low of 4.5 per cent by mid-2023. Inflation is converging to the Bank of Jamaica’s target band, though it was recently impacted by an increase in transport prices, whose effects are expected to dissipate towards the end of the year. Projected strong tourism inflows are expected to result in a current account surplus for FY2023/24, supporting a sound international reserves position. The financial system is well capitalised and liquid, and the public debt continues to fall.”

In his FT article Wigglesworth stated that in 2012 Jamaica “needed a bailout but the IMF, World Bank and Inter-American Development Bank were fed up of spending time and resources on a perennial hot mess”.

“Even after they grudgingly signed on to Jamaica’s 16th programme (thanks to US political duress) a frequent opening joke among staffers when they subsequently met to discuss it was ‘Has Jamaica failed yet?’ ”

However, Jamaica, he reminded his readers, didn’t fail.

He referenced Jamaica’s gross government debt to GDP, pointing out that after it peaked at 144 per cent in 2012, “the IMF estimates that it has now halved to about 72 per cent and will dip to roughly 68 per cent by the end of the year”.

That, Wigglesworth wrote, is “within touching distance of Germany’s debt-to-GDP level!”

Wigglesworth also noted that in its latest update the IMF commended the Jamaican Government for continuing to implement sound macroeconomic policies, aided by sound policy frameworks.

“Supported by strong revenues and strict control of non-wage spending, a prudent fiscal stance continues to support a reduction in public debt, which is expected to reach 72 per cent of GDP in FY2023/24 — the lowest in 25 years — well below pre-pandemic levels,” the IMF also stated.

“The Bank of Jamaica has maintained an appropriately tight policy stance, and its data-dependent monetary policy is countering the inflationary impulse from a strong economic recovery, tight labour markets, and global commodity prices. This policy mix is placing Jamaica in a good position to respond to shocks, counteract inflationary pressures, and secure debt sustainability,” the fund added.

Wigglesworth also noted that in November, Jamaica, underscoring its financial rehabilitation, sold the first Jamaican dollar-denominated international bond in history, helping to term out its payments and lessen its exposure to the United States dollar.

He stated that while that has come at a cost to growth, “the economy has kept growing throughout, and unemployment is now at a record low of just 4.5 per cent”, putting the jobless and inflation rates similar to Germany’s.

The FT writer ends his article with a light-hearted quip: “Perhaps Jamaica should be sending a mission of its economic technocrats to Washington to help the US sort itself out?”