S&P Affirms Jamaica at ‘BB’ with Stable Outlook as Melissa Rebuild Temporarily Lifts Debt

On September 21, 2026, S&P Global Ratings affirmed Jamaica’s ‘BB’ long-term and ‘B’ short-term foreign and local currency sovereign credit ratings, with a stable outlook. The stable outlook balances expectations that the government will prudently manage the recovery and rebuilding of Jamaica’s infrastructure as well as its inherent vulnerability to external shocks.
Real GDP is projected to contract 1.1% in 2026 before rebounding 3.0% in 2027 and 2.6% in 2028, supported in part by reconstruction centralised through the National Reconstruction and Resilience Authority. Tourism, which accounts for as much as 30% of GDP, had about 72% of hotel operators back in operation as at July 2026, while tourist passengers in H1 2026 were 20% lower than a year earlier.
On the fiscal side, a temporary deterioration of the government's fiscal profile is expected given the magnitude and severity of Hurricane Melissa. As such, the government is projected to deviate from its past modest surpluses and report a fiscal deficit of 4.2% for fiscal 2026. Its fiscal profile is expected to further deteriorate in fiscal 2027 (-2.5%) as revenues remain pressured and post-Melissa reconstruction spending scales, before narrowing to 0.6% by 2028. Still, it is important to note that, Jamaica is the only one of the 141 sovereigns rated by S&P to have posted an annual primary surplus above 3% of GDP for each of the past 10 years.
Net general government debt is also expected to rise to 55.6% of GDP this year from 53.6% in 2025, before easing to 50.1% by 2029. Interest on debt is projected to absorb about 17% of revenues on average over 2026 to 2029. S&P also flagged that the public sector wage agreements signed in August 2026 could lift wages and salaries to 13.5% of GDP by the end of FY2027. S&P also believes there is strong commitment across government to return to a 60% debt-to-GDP ratio by FY2030, although the government has yet to legislate a timeline to achieve this ceiling
Externally, the current account is expected to swing to deficits averaging 3.3% of GDP over the next four years. Coming from surpluses averaging 2.3% of GDP in the prior two years, this is owed to lower exports, higher rebuilding-related imports and higher energy costs.
The credit rating could be downgraded during the next 12 months if changing fiscal policy and a weaker commitment to fiscal sustainability over the long term lead to materially larger, sustained deficits over the forecast horizon, that is not expected to improve. Conversely, the ratings could be upgraded over the same period if Jamaica's debt burden improves with a sustained and material decrease in its interest-to-revenues ratio and a quicker recovery in the government's fiscal performance. A positive action could also occur if the economic recovery is substantially faster and stronger than expected, leading to higher longer-term economic growth that converges with that of peers at a similar level of economic development

(Source: S&P Global Ratings)