Fitch holds Jamaica rating steady despite hurricane
Published:Wednesday | February 11, 2026 | 12:06 AM
Fitch Ratings affirmed Jamaica’s credit rating at BB with a stable outlook, betting the island nation can withstand hurricane damage without derailing its decade-long effort to reduce government debt.
“Despite considerable uncertainty regarding the impact of Hurricane Melissa, Fitch sees headroom at the current rating to accommodate the hurricane’s expected short-term negative economic growth and fiscal metric implications,” Fitch said in a release last week.
The rating agency expects Jamaica’s economy to contract 1.5 per cent in 2025 and a further 2.6 per cent in 2026 following Hurricane Melissa, which struck the western side of the island on October 28 as a Category 5 storm. The damage represents nearly 40 per cent of Jamaica’s GDP output, or US$8.9 billion, and severely hit key tourism areas and agricultural regions.
Fitch is one of three major rating agencies, along with Moody’s and Standard & Poor’s (S&P). Last September, S&P upgraded Jamaica’s sovereign rating and affirmed a positive outlook. This was followed by a revision to a stable outlook in December 2025 due to near-term economic impacts from Hurricane Melissa.
Despite the economic blow, Fitch said Jamaica has assembled adequate financial resources to manage reconstruction. The Government will tap a multilateral loan package exceeding US$6 billion in concessional financing, US$250 million in insurance and contingency funds, US$384 million in credit lines, a US$150-million catastrophe bond, and between US$1 billion and US$2.5 billion in private insurance proceeds.
“Although the economic damages and recovery costs from Hurricane Melissa will be large, leading to an economic contraction in 2025–2026 and a deterioration in fiscal metrics, the government will return to its fiscal consolidation efforts beginning in 2027,” Fitch said.
Fitch projects the fiscal balance will swing to a deficit of 3.1 per cent of GDP in the year ending March 2026, widening to 5.7 per cent the following year from a balanced position in fiscal 2024. Government debt is expected to climb near 70 per cent of GDP by end 2026, up from 64.7 per cent previously.
Tourism receipts, which represented roughly 20 per cent of GDP in 2024, are estimated to have fallen nearly 15 per cent in 2025 and are projected to decline by a similar amount in 2026. The tourism ministry expects the industry to recover 85 per cent of capacity by May and 95 per cent by year end 2026, with large hotels that were largely insured rebuilding relatively quickly.
Fitch said increased remittances – which represented 16 per cent of GDP in 2024 – should partially offset tourism losses. The agency noted Jamaica’s strong governance record and bipartisan support for fiscal reforms that reduced debt-to-GDP from 135 per cent in 2012.
The rating could face downward pressure from another external shock or sustained fiscal loosening, Fitch warned.