International ratings agency Moody’s has upgraded Jamaica’s long-term issuer and senior unsecured ratings to Ba3 from B1, while revising the outlook to stable from positive, citing sustained improvements in the country’s fiscal and policy framework.
In its assessment, Moody’s said the upgrade reflects more than a decade of strengthened institutional and policy arrangements that have anchored fiscal discipline and bolstered monetary credibility. The agency noted that Jamaica has reduced government debt by nearly 40 percentage points of gross domestic product since 2020, outperforming many peers despite a temporary fiscal setback linked to Hurricane Melissa.
Moody’s said it expects the government to remain committed to maintaining sustained primary surpluses, allowing public debt to return to a downward trajectory after a short-term increase associated with disaster recovery spending. In response to the hurricane, the government mobilized approximately J$6.7 billion in financial support from international institutions to address the damage.
The ratings agency forecasts a real GDP contraction of nearly 2% in 2025, followed by zero growth in 2026, reflecting the economic impact of the hurricane and ongoing recovery efforts. Emergency response and reconstruction spending are expected to push government expenditure about five percentage points of GDP above pre-storm projections.
As a result, Jamaica’s debt-to-GDP ratio is projected to rise to 68% in fiscal year 2025/26, before declining to 64% by fiscal year 2028/29, as fiscal consolidation resumes.
Moody’s also highlighted Jamaica’s disaster risk management toolkit, including catastrophe insurance coverage, which provides roughly US$660 million in immediate liquidity. The agency said this buffer reduces the government’s reliance on more costly commercial borrowing in the aftermath of natural disasters, supporting overall credit strength.
