(Moody's) New York, July 20, 2018 -- Moody's Investors Service, ("Moody's") has today affirmed Government of Jamaica's B3 long-term issuer ratings and changed the outlook to positive from stable. Jamaica's senior unsecured ratings were also affirmed at B3, and its senior unsecured shelf ratings were affirmed at (P)B3. The key drivers for the outlook change to positive are as follows:
1. Ongoing fiscal consolidation, if sustained, supports a continued reduction in Jamaica's government debt burden
2. Improving institutional capacity and policy effectiveness
The affirmation of the B3 rating captures the authorities' commitment to continued fiscal consolidation, implementation of structural reforms, progress in lowering government debt ratios, and reduced external vulnerabilities. These credit strengths are set against the very high government debt ratios, large interest burden, and low GDP growth rates. In a related action, Moody's has also changed the outlook to positive from stable and affirmed the B3 senior unsecured ratings of government-related entities Air Jamaica Limited and National Road Operating and Construct. Co Ltd.