Jamaica has posted a record budget surplus and is on track to lower its national debt, a sign that the once fledgling economy is on a slow rebound.
Minister of Finance and Public Service Audley Shaw has reported a primary budget surplus of $135.9 billion, which was $7.7 billion or six percent above the targeted surplus.
Debt likely to fall below 109 percent of GDP
Shaw, told journalists at a news briefing that the country’s debt is likely to fall below the targeted 109 per cent of gross domestic product (GDP) by the end of 2017/18. The debt-to-GDP ratio was already down to 115 per cent of GDP, coming from a high of 150 per cent of GDP, and will remain on track.
The minister said the positive development was due to the Government’s most recent debt management exercise. He confirmed the country was able to repay some US$526 million in debt that was issued under the Jamaica Debt Exchange.
Longer term debts issued
In return for raising the required funds to meet the debt prepayment, Shaw explained the Government was able to issue longer-term debts of US$869 million that will now mature in 2028 and 2045, instead of 2019 and 2025.
“This strong budget performance has provided the Government with more funds for investing in the Jamaican people and future generations,” he noted.
Shaw said Jamaica had seen a rise in foreign direct investments (FDIs) in the areas of tourism, port expansion and business process outsourcing. He said that FDIs had increased from US$580 million in 2014 to US$866 in 2016.
Shaw said Jamaicans were benefiting from the improved economic showing, citing the rise in the income tax threshold to $1.5 million and an increase in social security payment which benefited an estimated 300,000 citizens.