Jamaica: 2024 Article IV Consultation and Second Reviews Under the Arrangement Under the Precautionary and Liquidity Line and Arrangement Under the Resilience and Sustainability Facility-Press Release; Staff Report; and Statement by the Executive Director for Jamaica

© 2024 International Monetary Fund IMF Country Report No. 24/69 JAMAICA 2024 ARTICLE IV CONSULTATION AND SECOND REVIEWS UNDER THE ARRANGEMENT UNDER THE PRECAUTIONARY AND LIQUIDITY LINE AND ARRANGEMENT UNDER THE RESILIENCE AND SUSTAINABILITY FACILITY—PRESS RELEASE; STAFF REPORT; AND THE STATEMENT BY THE EXCECUTIVE DIRECTOR FOR JAMAICA In the context of the Staff Report for the 2024 Article IV Consultation and Second Reviews Under the Arrangement Under the Precautionary and Liquidity Line and Arrangement Under the Resilience and Sustainability Facility, the following documents have been released and are included in this package: • Press Release summarizing the views of the Executive Board as expressed during its February 28, 2024, consideration of the staff report that concluded the Article IV consultation with Jamaica. • The Staff Report prepared by a staff team of the IMF for the Executive Board’s consideration on February 28, 2024, following discussions that ended on January 18, 2024, with the officials of Jamaica on economic developments and policies. Based on information available at the time of these discussions, the staff report was completed on February 12, 2024. • World Bank Assessment Letter for the Resilience and Sustainability Facility • A Statement by the Executive Director for Jamaica The IMF’s transparency policy allows for the deletion of market-sensitive information and premature disclosure of the authorities’ policy intentions in published staff reports and other documents. Copies of this report are available to the public from International Monetary Fund • Publication Services PO Box 92780 • Washington, D.C. 20090 Telephone: (202) 623-7430 • Fax: (202) 623-7201 E-mail: publications@imf.org Web: http://www.imf.org Price: $18.00 per printed copy International Monetary Fund Washington, D.C. March 2024 JAMAICA INTERNATIONAL MONETARY FUND 1 PR24/61 IMF Executive Board Concludes 2024 Article IV Consultation and Second Reviews Under the Precautionary and Liquidity Line and Under the Resilience and Sustainability Facility Arrangements with Jamaica FOR IMMEDIATE RELEASE Washington, DC – February 28, 2024: The Executive Board of the International Monetary Fund (IMF) concluded the Article IV consultation1 and Second Reviews Under the Precautionary and Liquidity Line and Under the Resilience and Sustainability Facility Arrangements with Jamaica. 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 prioritizing macroeconomic stability, which allowed Jamaica's response to recent global shocks to be prudent, agile, and supportive of growth. After two years of rapid post-pandemic recovery, GDP growth is projected at 1.7 percent in FY2023/24, with tourism well above pre-pandemic levels and unemployment falling to a record-low of 4.5 percent 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 capitalized and liquid, and the public debt continues to fall. The outlook points to sustained growth and inflation falling within the Bank of Jamaica’s target range amid sound external and fiscal positions and financial system stability. Nonetheless, global risks remain high. A rise in global risk aversion may increase financing costs and lower projected global growth, and regional conflicts could increase global commodity prices. Finally, climate-related events could weaken economic activity. The Jamaican authorities continue to implement sound macroeconomic policies, aided by strong policy frameworks. Supported by buoyant revenues and 1 Under Article IV of the IMF's Articles of Agreement, the IMF holds bilateral discussions with members, usually every year. A staff team visits the country, collects economic and financial information, and discusses with officials the country's economic developments and policies. On return to headquarters, the staff prepares a report, which forms the basis for discussion by the Executive Board. JAMAICA 2 INTERNATIONAL MONETARY FUND strict control of non-wage spending, a prudent fiscal stance continues to support a reduction in public debt towards the target in the Fiscal Responsibility Law. 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 labor 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. Following the Executive Board’s discus