Caribbean & Central America - July 2025

The Planning Institute of Jamaica (Pioj), a government office, says that quarter-on-quarter economic growth was strong in the second quarter of the year, with GDP expansion expected to be within a 0.5% to 1.5% range.

The Pioj says second-quarter activity was lifted by agriculture, tourism, and construction. Agriculture was recovering after the damage caused by Hurricane Beryl and Tropical Storm Rafael late last year. Tourism airport arrivals were up by 5.3% in April, lifted by Spring Break and Carnival, with construction led by residential housebuilding and a road network programme. Pioj director Wayne Henry said high levels of employment and consumer confidence were also in play. He argued that “All industries are forecast to record growth as the recovery from the weather-related shocks in 2024 will become more pronounced in the latter half of calendar 2025”.

Separately, on 27 June the International Monetary Fund (IMF) published the results of its regular Article IV consultation on the state of the Jamaican economy. It said the response to Hurricane Beryl and Tropical Storm Rafael had been “agile, prudent, and growth supportive”. Unemployment has fallen to an all-time low (3.7% in January), inflation has converged to the Bank of Jamaica (BOJ)’s target band of 4%-6%, and the current account has been in surplus for the last two years. There was a recession in fiscal year 2024/25 (GDP dropped 0.8% because of the extreme weather) but growth of 2.2% is predicted for 2025/26. The Fund’s executive board commented “Over more than a decade Jamaica has been implementing sound macroeconomic policies supported by strong policy frameworks. These efforts have allowed Jamaica to accumulate meaningful policy buffers, reduce public debt, anchor inflation and improve its external position.”