Jamaica Forecasted to Grow 1.6% in 2025

  • In line with BMI’s expectations, the Jamaican economy expanded by 1.6% year-over-year (y-o-y) in Q2 2025, up from 1.1% in the previous quarter, as it continues to recover from Hurricane Beryl in 2024. Q2 growth was supported by low inflation, growing employment levels, and a historically low unemployment rate.
  • Favourable domestic macroeconomic indicators persist in Jamaica, underpinning BMI’s cautiously optimistic outlook for the economy in the near term. Higher-frequency indicators for Q3 2025 also support this view. Consequently, BMI maintained its forecast that Jamaica’s economy will grow by 1.6% in 2025 and by 1.5% in 2026.
  • Overall employment in Q3 grew by 2.3% y-o-y, the labour force expanded compared to the year before, and the unemployment rate was steady at 3.3% - a historic low. Remittances have also remained robust in the face of a challenging external environment, growing by 3.6% y-o-y in Q2 and helping support household income and consumption.
  • Additionally, relevant production indicators point to growth in H2 2025. Total bauxite production in July grew by 4.5% y-o-y, supported by improved alumina production, driving overall year-to-date growth to 2.7% – a tailwind for the mining industry, which suffered losses in Q2. The reopening of the Alpart plant (closed since 2019) in Q4 2025 will further boost the mining sector.
  • For the tourism sector, preliminary estimates also show continued strength in tourism in Q3, with airport arrivals estimated to have increased by 16.5% in July 2025. Finally, Jamaica will benefit from positive storm-related base effects in H2 2025, while an expected reduction in the policy rate in Q4 2025 will support growth through increased investment and consumption.
  • Overall, Jamaica’s economic growth in H1 2025 is encouraging, but several risks persist. Ongoing trade uncertainty and weak external demand will likely weigh on the economy through 2025 and into 2026. U.S. immigration policies and new taxes on remittances may reduce these vital flows in the medium term. Extreme weather remains a threat, especially to tourism, agriculture and mining. While crime has dropped significantly – murders are down 40.9% year-to-date as at October 4, 2025 – it remains elevated and could still hinder investment and growth.

(Source: BMI, A Fitch Solutions Company)