Jamaica Eyes Targeted Measures to Accelerate Economic Recovery

Prime Minister Andrew Holness says the Government is examining counter-cyclical support for businesses and economic activity while seeking to preserve Jamaica’s hard-won macroeconomic stability.

KINGSTON, Jamaica — The Jamaican Government is considering targeted measures to accelerate economic recovery as Prime Minister Andrew Holness says the country’s fiscal position provides room for carefully designed support without abandoning macroeconomic discipline.

Holness said economic growth remains negative but has been becoming “less negative each quarter,” as the country works through the economic effects of Hurricane Melissa and other pressures.

Targeted Support Under Consideration

The Prime Minister said the Government is examining counter-cyclical measures that could help stimulate economic activity.

Such measures are generally intended to support demand, businesses or investment during periods of economic weakness, but Holness stressed the importance of acting without undermining the stability Jamaica has worked to build.

Small businesses are among the groups the Government intends to support as recovery efforts continue.

Private-Sector Discussions Planned

Holness said the Government plans to engage the private sector on measures that could encourage stronger economic activity.

The discussions come as businesses contend with the effects of the slowdown and the wider rebuilding process.

Targeted interventions could therefore form part of a broader effort to move the economy from contraction toward recovery while directing support to areas where it can have the greatest effect.

Inflation Complicates the Recovery

The Government’s room to stimulate economic activity is complicated by inflation pressures.

Holness pointed to drought-related effects on agricultural production and food supplies alongside rising international food and oil prices.

That combination creates exposure to both domestic and imported inflation, increasing the importance of how any economic-support measures are designed.

Fiscal Support Meets Monetary Tightening

The Government’s consideration of targeted fiscal support comes as the Bank of Jamaica is using monetary policy to contain inflation.

That means the country’s economic response is operating on two fronts: efforts to support recovery and business activity while the central bank seeks to prevent elevated inflation from becoming entrenched.

The policy challenge is to stimulate productive activity without creating additional price pressures or threatening fiscal and monetary stability.

Recovery Without Abandoning Stability

Holness’ comments suggest the Government intends to use the fiscal space created through years of debt reduction and macroeconomic reform selectively rather than pursue broad, untargeted stimulus.

The details of any new measures have not yet been announced.

For businesses and households, the next stage will be the outcome of Government consultations and decisions on which interventions can accelerate recovery while maintaining Jamaica’s broader economic stability.

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