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S&P affirms Jamaica following smooth political transition


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S&P affirms Jamaica following smooth political transition

S&P Global Ratings on Sept. 26 affirmed its ratings on Jamaica,noting that the country experienced a smooth political transition following electionsin February, which reflects continued consensus on the nation's reform path.

S&P affirmed Jamaica's long- and short-term foreign and localcurrency sovereign credit ratings at B and its transfer and convertibility assessmentat B+. The outlook on the long-term ratings remains stable.

The rating agency expects Jamaica's creditworthiness to remainlimited by its high general government debt and interest burden, weak economy andvulnerability to external shocks. However, the smooth political transition and policycontinuity following the elections highlight bipartisan support for conservativefiscal policies.

"This consensus leads us to believe that Jamaica's new administrationwill continue to meet ambitious fiscal targets, fostering macroeconomic stabilityand potentially setting the stage for better GDP growth in the coming years,"S&P said.

The agency anticipates real GDP growth to accelerate slightlyto 1.5% by 2017 from 1% in 2015, partly driven by faster growth of the U.S. economy.In turn, that should sustain remittances, which represent around 16% of the Jamaicaneconomy, S&P noted.

It added that the country's external profile has recently benefitedfrom favorable conditions, including low oil prices and expansion of the tourismindustry.

S&P Global Ratingsand S&P Global Market Intelligence are owned by S&P Global Inc.