Jamaica’s Current Account to Narrow but Remain Positive In 2025

Driven by reduced services exports and increased demand for imports by Jamaican consumers and businesses, Jamaica’s current account surplus is expected to narrow from 3.3% of GDP in 2024 to 1.6% of GDP in 2025, according to Fitch Solutions. However, despite these headwinds, Jamaica’s expected surplus in 2025 will mark the third consecutive year of a current account surplus, reflecting the continued relative strength of Jamaica’s tourism sector, strong reported bauxite production and exports, and resilient remittance inflows.
While Fitch expects some softening of remittances in 2025 due to a sluggish United States (U.S.) growth outlook, inflows have remained resilient in the first quarter of 2025 (Q1 2025), supporting Jamaica’s large secondary income account surplus, which accounted for 16.8% of GDP in 2024, and is projected at 15.5% of GDP in 2025. According to the most recent data available (Jan.-Feb. 2025) net remittances have increased by 2.9% relative to the previous period in 2024.
In line with the declining levels of inbound tourism expected in 2025; Jamaica’s services exports are expected to fall from 25.8% of GDP in 2024 to 24.0% in 2025. However, given the reported strength in bauxite production and exports, goods exports will see marginal increases, from 9.2% of GDP in 2024 to 9.8% of GDP in 2025, supporting Jamaica’s trade balance. Additionally, with oil and energy accounting for almost 20% of total imports in 2024, forecasted decreases in oil prices will positively impact Jamaica’s terms of trade and overall trade balance.
Mirroring the current account surplus in 2024, Jamaica’s financial account showed net financial outflows, driven by outbound portfolio investment, other investment, and the accumulation of foreign reserve assets. However, FDI inflows in 2024 fell well short of the levels seen in 2023, declining 57% y-o-y, with 2025 unlikely to see a rebound, due to dampened external demand and increased economic uncertainty from U.S. trade policy.
That being said, risks are tilted to the downside, with sharper-than-expected reductions in remittances and inbound tourism potentially narrowing the current account by a greater degree than anticipated. A continued softening of external growth and economic activity in the U.S. also presents a significant downside risk to the outlook, with decreased demand for Jamaican goods and services exports a headwind to growth, net exports, and the current account surplus.
In terms of the current Middle East Conflict, higher oil prices could dampen trade and growth prospects, which would negatively impact Jamaica’s trade balance. However, the ceasefire between Israel and Iran and the de-escalation of the conflict, in turn, saw a collapse in oil prices, with Brent Crude trading back around US$69 per barrel (/bbl), and Fitch believes oil prices will remain in the range of US$70–80/bbl.
That said, the outlook is mixed and is heavily dependent on the event of a re-escalation in tensions. Any sustained move above US$90/bbl would begin to weigh on global activity, while for a surge to US$120–150/bbl, global inflation could rise by 1.2–1.8 percentage points (pp) and global growth could be reduced by at least 0.2–0.3pp, likely tipping the global economy into a mild recession.

(Source: Fitch Connect)