{
  "title": "IMF Executive Board Concludes 2021 Article IV Consultation with Jamaica",
  "publication": "IMF News, February 15, 2022",
  "sourceUrl": "https://www.imf.org/en/news/articles/2022/02/15/pr2240-imf-executive-board-concludes-2021-article-iv-consultation-with-jamaica",
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  "summary": "In the decade preceding the pandemic, Jamaica improved macroeconomic and financial stability:",
  "publishDate": "2022-02-15",
  "sections": [
    {
      "heading": "Overview and recent macroeconomic performance",
      "content": "- In the decade preceding the pandemic, Jamaica improved macroeconomic and financial stability:\n  - Fiscal deficit reduced from 11 percent of GDP in 2009 to a surplus (no year specified for the surplus in the source).\n  - Public debt fell from 142 percent of GDP to 94 percent in 2019.\n  - Inflation and the current account deficit declined.\n- An early lockdown in Spring of 2020 contained Covid-19 cases but the economy contracted sharply:\n  - Real GDP shrank by 10 percent (source text: \"real GDP shrinking by 10 percent\").\n- The fiscal response and pandemic effects produced a fiscal deficit of 3.1 percent of GDP in FY2020/21."
    },
    {
      "heading": "COVID-19 response and fiscal/monetary actions",
      "content": "- Authorities’ measures:\n  - Suspended the fiscal rule for a year.\n  - Implemented public health measures and a fiscal package to support jobs and protect vulnerable populations.\n- Monetary policy:\n  - Monetary accommodation played an important role during the pandemic.\n  - Authorities signaled readiness to tighten monetary policy in light of inflationary pressures.\n  - Planned roll-out of a central bank digital currency with appropriate safeguards as part of the financial inclusion strategy."
    },
    {
      "heading": "Economic outlook and risks",
      "content": "- Growth projections:\n  - Real GDP is projected to grow at 4.7 percent in 2021 and 4.3 percent in 2022.\n- Main risks to the outlook:\n  - Covid-19 (renewed waves in Jamaica or abroad) that could prolong disruptions to tourism, trade, and capital flows.\n  - Uncertain duration of global inflationary pressures, which have boosted inflation to well above the central bank’s target range of 4-6 percent.\n  - Natural disasters remain an ever-present risk."
    },
    {
      "heading": "Executive Board assessment — findings and policy recommendations",
      "content": "- Near-term priorities:\n  - Protect lives and livelihoods while preserving macroeconomic stability.\n- Medium-term priorities:\n  - Rebuild buffers, safeguard debt sustainability, and prioritize structural reforms to reduce poverty and boost potential and inclusive growth.\n- Fiscal policy guidance:\n  - Once the pandemic recedes, resume growth-friendly fiscal consolidation and put public debt on a downward trajectory toward the authorities’ medium-term target.\n  - Improve revenue and prioritize expenditures to create space for health, education, infrastructure, and growth-enhancing investment, including for climate resilience.\n  - Enhance spending efficiency and contain the wage bill.\n  - The newly established independent fiscal council would help strengthen fiscal institutions and safeguard the credibility of the debt anchor.\n- Monetary and financial sector guidance:\n  - Welcome authorities’ readiness to tighten monetary policy to firmly anchor inflation expectations and bring inflation to within the central bank’s target range by end-2022.\n  - Strengthen group-wide supervision of financial conglomerates by adopting the remaining legislation and improving data collection.\n  - Strengthen the AML/CFT framework and swiftly implement the action plan agreed with the Financial Action Task Force.\n- Structural reforms:\n  - Address supply-side constraints through well-prioritized reforms to boost competitiveness and resilience, including digital transformation.\n  - Strengthen education and training, upgrade infrastructure, reduce crime, and build resilience and adaptation to natural disasters."
    },
    {
      "heading": "Selected economic indicators (2019–2023) — key statistics from the release",
      "content": "- Population (2019): 2.73 million\n- Per capita GDP (2019): US$5729\n- Quota (current; millions SDRs/% of total): 382.9/0.08%\n- Literacy rate (2015)/Poverty rate (2017): 87%/12.6%\n- Main products and exports: Alumina, tourism, chemicals, mineral fuels, bauxite\n- Unemployment rate (Jan. 2020): 7.3%\n- Key export markets: U.S., U.K., Canada\n\n- Real GDP growth (%):\n  - 2019/20: -0.1\n  - 2020/21 Est.: -11.1\n  - 2021/22 Proj.: 8.2\n  - 2022/23 Proj.: 3.5\n- Unemployment (%) 1/: 7.3 (2019/20); note: \"...\" for 2020/21 in source\n- Inflation, end of period (%):\n  - 2019/20: 4.8\n  - 2020/21 Est.: 5.2\n  - 2021/22 Proj.: 6.3\n- Inflation, average (%):\n  - 2019/20: 4.6\n  - 2020/21 Est.: 5.0\n  - 2021/22 Proj.: 6.7\n  - 2022/23 Proj.: 7.2\n\n- Central government finances 2/ (percent of GDP):\n  - Budgetary revenue:\n    - 2019/20: 30.6\n    - 2020/21 Est.: 29.1\n    - 2021/22 Proj.: 30.5\n  - Budgetary expenditure:\n    - 2019/20: 29.7\n    - 2020/21 Est.: 32.2\n    - 2021/22 Proj.: 30.2\n    - 2022/23 Proj.: 28.8\n  - Budget balance:\n    - 2019/20: 0.9\n    - 2020/21 Est.: -3.1\n    - 2021/22 Proj.: 0.3\n  - Of which: central government primary balance:\n    - 2019/20: 7.1\n    - 2020/21 Est.: 5.9\n    - 2021/22 Proj.: 5.4\n  - Public entities balance (% of GDP):\n    - 2019/20: 0.1\n    - 2020/21 Est.: -0.5\n    - 2021/22 Proj.: 0.0\n  - Public sector balance (% of GDP):\n    - 2019/20: 1.0\n    - 2020/21 Est.: -3.5\n  - Public debt (% of GDP) 3/:\n    - 2019/20: 94.3\n    - 2020/21 Est.: 108.1\n    - 2021/22 Proj.: 91.6\n    - 2022/23 Proj.: 84.7\n\n- Money and credit:\n  - Broad money (% change):\n    - 2019/20: 54.8\n    - 2020/21 Est.: 63.9\n    - 2021/22 Proj.: 64.5\n  - Credit to the private sector (% change):\n    - 2019/20: 43.9\n    - 2020/21 Est.: 49.4\n    - 2021/22 Proj.: 51.2\n    - 2022/23 Proj.: 50.6\n  - Treasury bill rate, end-of-period (%):\n    - 2019/20: 1.8\n    - 2020/21 Est.: 0.8\n  - Treasury bill rate, average (%):\n    - 2019/20: 1.3\n\n- Balance of payments:\n  - Current account (% of GDP):\n    - 2019/20: -2.2\n    - 2020/21 Est.: -1.1\n    - 2021/22 Proj.: 1.1\n    - 2022/23 Proj.: -2.3\n  - FDI, net (% of GDP):\n    - 2019/20: 1.4\n    - 2020/21 Est.: 2.7\n    - 2021/22 Proj.: 3.0\n  - Gross international reserves (weeks of imports):\n    - 2019/20: 5.5\n    - 2020/21 Est.: 8.5\n    - 2021/22 Proj.: 8.9\n    - 2022/23 Proj.: 8.7\n  - External debt (% of GDP):\n    - 2019/20: 57.6\n    - 2020/21 Est.: 71.0\n    - 2021/22 Proj.: 58.5\n    - 2022/23 Proj.: 54.3\n\n- Exchange rate:\n  - End-of-period REER (appreciation +) (INS): -5.0 (2019/20)\n\nPress Release No. 22/40 — IMF Communications Department, February 15, 2022.\n\n---\n\n\n References\n\n- Jamaica and the IMF\n- IMF Policy Advice -- A Factsheet\n- Press Releases\n- PRESS CENTER\n- http://www.IMF.org/external/np/sec/misc/qualifiers.htm\n- https://www.imf.org/en/home\n\nSource: https://www.imf.org/en/news/articles/2022/02/15/pr2240-imf-executive-board-concludes-2021-article-iv-consultation-with-jamaica"
    }
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    "Published: February 15, 2022",
    "In the decade preceding the pandemic, Jamaica improved macroeconomic and financial stability:",
    "An early lockdown in Spring of 2020 contained Covid-19 cases but the economy contracted sharply:",
    "The fiscal response and pandemic effects produced a fiscal deficit of 3.1 percent of GDP in FY2020/21.",
    "Authorities’ measures:",
    "Monetary policy:",
    "Growth projections:",
    "Main risks to the outlook:",
    "Near-term priorities:",
    "Medium-term priorities:",
    "Fiscal policy guidance:",
    "Monetary and financial sector guidance:",
    "Structural reforms:",
    "Population (2019): 2.73 million",
    "Per capita GDP (2019): US$5729",
    "Quota (current; millions SDRs/% of total): 382.9/0.08%",
    "Literacy rate (2015)/Poverty rate (2017): 87%/12.6%",
    "Main products and exports: Alumina, tourism, chemicals, mineral fuels, bauxite",
    "Unemployment rate (Jan. 2020): 7.3%",
    "Key export markets: U.S., U.K., Canada",
    "Real GDP growth (%):",
    "Unemployment (%) 1/: 7.3 (2019/20); note: \"...\" for 2020/21 in source",
    "Inflation, end of period (%):",
    "Inflation, average (%):",
    "Central government finances 2/ (percent of GDP):",
    "Money and credit:",
    "Balance of payments:",
    "Exchange rate:",
    "[Jamaica and the IMF](http://www.imf.org/external/country/JAM/index.htm)",
    "[IMF Policy Advice -- A Factsheet](https://www.imf.org/en/about/factsheets/imf-surveillance)",
    "[Press Releases](https://www.imf.org/en/news/searchnews)",
    "[PRESS CENTER](http://presscenter.imf.org/)",
    "[http://www.IMF.org/external/np/sec/misc/qualifiers.htm](http://www.imf.org/external/np/sec/misc/qualifiers.htm)",
    "[https://www.imf.org/en/home](https://www.imf.org/en/home)"
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