Fitch Ratings does not expect any significant economic or fiscal policy changes following the recent general election which saw the incumbent Jamaica Labour Party (JLP) re-elected for a third-consecutive term.

“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 stated in its September 8 wire.

The credit ratings agency noted that the two main political parties shared a broad policy consensus regarding economic and fiscal policy. This is based on Fitch’s February 2025 report that both parties are committed to inflation-targeting monetary policy and fiscal policy anchored on debt-reduction targets. The JLP won 35 of the 63 seats compared to the 28 seats for the People’s National Party (PNP).

However, the rating agency noted that pressure may rise for increased spending on areas that weren’t priority due to the focus on debt reduction over the last decade. This was reflected in Fitch’s 2025 and 2026 forecast’s for Jamaica’s primary surplus which should remain above 3 per cent of gross domestic product (GDP).

“Nevertheless, Jamaica’s strong track record of adherence to fiscal rules and its demonstrated willingness to consolidate underpin our view that it will maintain fiscal discipline. Any recalibration will occur within existing fiscal targets,” Fitch noted in its report.

Fitch currently forecasts gross general government debt to GDP to decline to 59 per cent in 2027 which is one year ahead of the 2028 target for 60 per cent debt to GDP. While Fitch expects further debt reduction, it expects this to happen at a slower pace, especially since there is no clarity on future targets that could constitute a fiscal anchor beyond 2027.

It should be noted that Jamaica’s debt to GDP ratio has dipped to 62.4 per cent according to the Planning Institute of Jamaica. This is based on updated economic measurement standards which includes the full implementation of the 2008 System of National Accounts by the Statistical Institute of Jamaica. This impacts the way in which GDP and other indicators are calculated.

“The macroeconomic framework continues to support resilience to shocks. GDP growth resumed in 1Q25 and strengthened in 2Q25 following disruptions from Hurricane Beryl and heavy rains last year. Inflation remains around the midpoint of the 4-6 per cent target range, reflecting credible monetary policy and anchored expectations. Fitch will update its macroeconomic forecasts for Jamaica in our quarterly Sovereign Data Comparator later this month,” Fitch noted.

S&P Global Ratings had Jamaica as one of the three global elections to watch for September. It noted that the Opposition (PNP) would likely push for welfare expansion and increased spending on health care, education and small business support.

“If the JLP wins, policy continuity is likely, focusing on economic growth, maintaining fiscal discipline, and prioritising infrastructure improvements and efforts to control crime,” S&P Global stated.