Debt, Fiscal Adjustment and Economic Growth in Jamaica
Juan Pedro Schmid; Xavier A. Malcolm
The buildup of debt in Jamaica has been concurrent with the country’s slow economic growth, and the issues are intertwined. High debt slows economic growth, and slow economic growth makes the process of reducing the debt burden more difficult. Jamaica committed itself to a strict fiscal consolidation program to reduce its debt burden. The fiscal consolidation will be long—spanning more than half a generation—until reaching the debt-to-GDP target of 60 percent by 2026. Besides adhering to the fiscal targets, success will depend on the country’s ability to break away from a history of low economic growth.