IMF says Jamaica's economic outlook remains positive, but global risks still high

Staff of the International Monetary Fund (IMF) have completed the third reviews of Jamaica's Precautionary and Liquidity Line (PLL) and the Resilience and Sustainability Facility (RSF), with their assessment being that the country's economic outlook remains positive.

The board of the IMF is set to meet in August to consider the reviews, approval of which would make available US$255 million to Jamaica under the RSF.

The IMF team, led by Esteban Vesperoni, held meetings with the Jamaican authorities from June 24 to 28, during which a staff-level agreement on the reviews was reached.

Vesperoni said the authorities' commitment to macroeconomic stability and strong policy frameworks continue to allow the country to respond prudently to recent global shocks.

He said growth has been solid, the external position has strengthened and the economic outlook remains positive.

However, Vesperoni noted that while the outlook is positive, it was subject to downside risks.

"Growth is expected to converge to potential and inflation to return close to the mid-point of the 4-6 per cent target band in 2024 amid moderating commodity prices. Nonetheless, global risks remain high and include tighter-than-expected global financial conditions, lower global growth and its impact on tourism and remittances, and an intensification of geo-political conflicts that increase global commodity prices. Natural disasters are an ever-present risk," he said.

The PLL is a line of credit providing insurance to Jamaica against downside risks, including those that arise from extreme weather events, while the RSF has supported Jamaica's agenda to increase resilience to climate change, transition to renewables and catalyse climate financing.

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