Jamaica - Country Commercial Guide
Investment Climate Statement (ICS) 
Last published date:

The U.S. Department of State’s Investment Climate Statements provide information on the business climates of more than 170 economies and are prepared by economic officers stationed in embassies and posts around the world. They analyze a variety of economies that are or could be markets for U.S. businesses. The Investment Climate Statements are also references for working with partner governments to create enabling business environments that are not only economically sound, but address issues of labor, human rights, responsible business conduct, and steps taken to combat corruption. The reports cover topics including Openness to Investment, Legal and Regulatory Systems, Protection of Real and Intellectual Property Rights, Financial Sector, State-Owned Enterprises, Responsible Business Conduct, and Corruption.

Executive Summary

The Government of Jamaica (GoJ) considers foreign direct investment (FDI) a key driver for economic growth and in recent years it has reformed its economy to improve the investment climate. Despite the negative effects of the COVID-19 pandemic, the war in Ukraine, and the ongoing tightening of global financial conditions, Jamaica’s sound policy framework and policies prioritizing macroeconomic stability helped the economy recover strongly in 2022. The expansion brought the unemployment rate to historic lows, causing some challenges for employers. 

The Jamaican economy grew by 5.2 percent in 2022, clawing back the lost output associated with the COVID-19 shock a year ahead of projections. This recovery was particularly impressive, as following previous shocks the Jamaican economy plunged into deeper recession. While the entire economy registered growth, tourism continued to lead the resurgence in output. The economic expansion had a positive impact on revenues, allowing the government to maintain its fiscal consolidation program, including a reduction in the debt to GDP ratio to below pre-pandemic levels. The country has now shed almost 60 percentage points from its debt to GDP ratio in less than a decade and is on track to reach its target of 60 percent of GDP by 2028. The fiscal space created by debt reduction allowed the government to execute public sector wage reforms. Inflation ended 2022 at near to 10 percent but began trending lower in 2023. 

The International Monetary Fund (IMF) Article IV Consultation released on February 10 lauded Jamaica’s fiscal performance, noted international reserves remain at healthy levels, and the financial system is well capitalized and liquidThe IMF’s Executive Board approved $1.7 billion in credit to Jamaica to protect against global economic, pandemic, and climate risks – a testament to the country’s sound economic policiesFitch Ratings upgraded the country’s sovereign debt outlook to positive in March 2023, attributing the revision to the significant progress in debt reduction, its institutional framework, and favorable financing conditions.

Despite the economic progress, Jamaica’s high crime rate, corruption, and comparatively high taxes have stymied investment prospectsThe country’s Transparency International corruption perception ranking improved marginally from 70 (2021) to 69 (2022) out of 180 countriesDespite laws that prescribe criminal penalties for corrupt acts by officials, there were still reports of corruption at some ministries and agenciesMeasures implemented to address crime continued into 2022, including the continuation of Zones of Special Operations in several high crime areas of the island however, it did not significantly impact the overall murder rateJamaica continues to have one of the highest homicide rates in the worldThe Embassy has an active Overseas Security Advisory Council consisting of U.S. companies in the hospitality, aviation, and other key sectors.

In 2021, the U.S. direct investment position in Jamaica was $39 million, while Jamaica had $60 million in investment in the United StatesBased on 2021 World Investment Report, Jamaica received total FDI of $321 million, up 21 percent and had outward FDI of $56 millionSpain and Mexico were the major drivers of FDI in 2021Tourism, mining, and energy have been the major areas of investment inflows into the islandThe host government has also promoted business process outsourcing (BPO), but investment in the BPO industry has been constrained by labor availabilityThe private sector anxiously awaits pending renewable energy tendersInvestments in improved air, sea, and land transportation have reduced time and costs for transporting goods and have created opportunities in logistics servicesHowever, port security deficiencies and customs delays continue to present challenges.

To access the ICS, visit the U.S. Department of State Investment Climate Statements website.