Jamaica WT/TPR/S/242 
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I. ECONOMIC ENVIRONMENT 
(1) INTRODUCTION  
1. Jamaica continues to be adversely affected by  macroeconomic and fiscal factors, notably a 
deteriorating trade balance, fiscal deficits, high national debt as well as negative domestic social 
factors and vulnerability to natural disasters.  Ja maica's already weak external competitiveness has 
worsened during the review period as relatively high production and trading costs and low productivity continue to be significant obstacl es to meeting international standards of 
competitiveness. 
2. Nonetheless, Jamaica can point to a number of positive achievements since 2005, including:  
further consolidation of its economic liberalization efforts;  development of a relatively stable and 
well-capitalized financial sector;  an impressive ma croeconomic performance in 2010 in a challenging 
economic environment;  a significant reduction in poverty levels from 28.4% in 1989 to 9.9% in 
2007
1;  and the fact that the country is on course to  meet most of its Millennium Development Goals, 
including that for achieving universal primary education. 
3. Jamaica's US$13 billion economy largely depends on alumina, tourism, remittances and its 
large informal sector.  Up to 2008, bauxite and alum ina accounted for over half of goods exports.  In 
2009, with the decline in international demand for th ese products, it fell to just over one third of goods 
exports.  Tourism generates over 70% of services e xports and directly and indirectly employs an 
estimated 15% of the labour force.  The informal sector is significant in the Jamaican economy and is 
estimated by the OECD to be the equivalent of  around 40% of GDP.  Remittances increased ten-fold 
between 1990 and 2008, and are cu rrently equivalent to about 13% of GDP, reflecting the success and 
growing numbers of the Jamaican diaspora.  Th e 2009 financial crisis has negatively impacted 
remittances, the bauxite industry and tourism receipt s, although tourism has proven to be far more 
resilient than in the rest of the Caribbean. 
4. Like most of its Caribbean neighbours, Jamaica' s economy is highly open with external trade 
(exports plus imports of goods and services) amoun ting to over 112% of GD P in 2008 (falling to 87% 
in 2009).  Jamaica's capital market has been open since the early 1990s and net capital inflows have 
averaged 10% of GDP in recent years, predominantly in the form of foreign direct investment.  In 
addition, Jamaica is highly reliant on external financ ing given its double-digit current account deficit, 
which reached an estimated 18% of GDP in 2008, and high public debt, which averaged 119% of 
GDP during the review period. 
(2) MAIN MACROECONOMIC DEVELOPMENTS AFFECTING TRADE  
5. Since 2005, the economy has continued to  shift away from primary activities and 
manufacturing.  Goods production now accounts for a little under one quarter of GDP, while services 
have become the main economic activity and the main earner of foreign exchange (Table I.1). 
6. For most of the past decade, economic growth has been low, at an annual average of under 
1%.  At the same time, inflation has remained relatively high while the external current account 
balance registered large deficits.  Poor growth and recurring bouts of  financial market instability have 
been rooted in increasingly high and unsustainable levels of public debt, which was still at 123% of 
GDP at the end of 2009, making Jamaica one of the world's most heavily indebted countries.  The economy has been hard hit by recent exogenous shoc ks including a recession in the U.S. economy, the 
global financial crisis, and a period of high fo od and fuel prices, although prices have begun to 
                                                     
 
1 World Bank (2010), p. i. WT/TPR/S/242 Trade Policy Review 
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decline.  Like most Caribbean countries, the ec onomy and financial system are highly dependent on 
the U.S. economy and financial market conditions. 
Table I.1 
Selected economic indicators, 2004/10a 
 2004/05 2005/06 2006/07 2007/08 2008/09 2009/10 
 (Annual % changes) 
GDP, prices, and unemployment       
Real GDP 0.7 1.5 3.4 0.6 -1.7 -2.5 
Nominal GDP 12.3 12.0 13.8 13.0 12.1 8.2 
Consumer price index (end of period) 13.2 11.2 8.0 19.9 12.4 13..3 
Consumer price index (average) 12.8 14.8 7.4 12.4 20.2 9.7 
Exchange rate (end of period, in J$/US$) 61.5 65.5 67.8 71.1 88.8 89.5 
End-of-period REER (% change, appreciation +) 5.1 4.0 -0.7 4.0 -10.1 .. 
Unemployment rate (per cent) 11.7 11.2 10.3 9.7 10.6 11.4 
Structure of GDP (% of current GDP at basic prices, including imputed bank service charges) 
Goods production 27.9 27.5 27.1 26.7 24.7 24.1 
Agriculture 5.6 6.1 5.9 5.3 5.6 6.1 
Mining and quarrying 4.3 4.0 4.1 3.5 1.6 0.9 
Manufacturing 9.3 8.9 8.7 8.9 9.0 9.1 
Construction 8.7 8.4 8.4 8.9 8.4 8.0 
Services 72.1 72.5 72.9 73.3 75.3 75.9 
Electricity and water 3.4 3.7 3.7 3.9 4.2 4.2 
Wholesale and retail trade, and repairs and 
installation of machinery 19.1 20.0 19.2 19.1 20.3 19.8 
Hotels and restaurants 4.9 4.8 4.8 4.8 4.7 4.8 
Transport, storage, and communication 11.8 11.5 11.9 11.7 10.8 10.7 
Financing and insurance services 10.2 10.0 9.8 10.2 10.5 10.1 
Real estate, renting, and business activities 9.6 9.9 9.8 10.3 10.4 9.2 
Producers of government services 11.5 11.0 11.7 11.6 13.0 13.9 
Other services 6.4 6.4 6.4 6.3 6.4 6.4 
Less financial intermediation services indirectly 
measured 4.7 4.9 4.5 4.6 4.9 4.8 
External sector (% of GDP) 
Current account/GDP -6.5 -10.5 -10.0 -17.0 -18.6 -7.6 
Merchandise trade balance/GDP -20.8 -24.1 -24.6 -31.3 -33.4 24.5 
Goods imports/GDP 35.9 40.2 42.6 50.7 50.7 35.7 
Goods exports/GDP 15.1 16.1 18.0 19.4 17.3 11.2 
Goods and services imports/GDP 52.5 56.0 59.7 68.4 67.4 50.7 
Goods and services exports/GDP 37.2 37.3 40.0 40.7 37.6 32.8 
FDI/GDP 5.8 6.6 7.2 6.2 5.8 4.2 
Private remittances/GDP 14.5 14.6 14.7 15.3 14.5 14.7 
Gross reserves (Central Bank) (US$ billion) 1.9 2.3 2.6 2.1 1.7 2.4 
Gross reserves in weeks of imports of goods and 
services 15.8 16.9 15.1 12.1 13.7 18.9 
M e m o  i t e m s        
Current GDP (J$ billion) 636.8 713.0 811.4 917.0 1,027.6 1,111.6 
Current GDP (US$ billion) 10.4 11.3 12.2 13.1 13.8 12.7 
Per capita GDP (US$) 3,843 4,198 4,180 4,182 5,198 4,657 
Public debt (% of GDP) 120.1 119.9 116.5 113.5 124 123 
Population (million) 2.6 2.7 2.7 2. 7 2.7 2.7 
.. Not available. 
a Fiscal year from 1 April to 31 March. 
Source:  Data provided by the Jamaican aut horities, based on Bank of Jamaica – Monthly Balance of Pa yments Statistical 
Updates ;  Statistical Institute of Jamaica – Quarterly Gross Domestic  Product January-March 2010 , National 
Income and Product 2009 , the Labour Force 2008 and 2009 , and consumer price i ndex monthly bulletins. Jamaica WT/TPR/S/242 
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7. The country has long struggled with a narrow productive structure and vulnerability to 
external shocks, both climatic a nd economic.  These shortcomings were exposed during the recent 
global economic slowdown.  Real GDP declined by 1.7% in fiscal year 2008/09, with economic 
conditions deteriorating sharply in  the second half of the year.  During 2009/10, real GDP contracted 
further, registering a decline of 2.5%.  Bauxite and alumina production was hard hit by the global 
economic downturn, leading to the closure of three out of four alumina plants, and exports fell by 
about 60%, while remittances – a traditional source of balance-of-payments support – suffered a 7% 
decline.  The employed labour force contracted by 50,200 between January 2009 and April 2010.  
Tourism has also been negatively affected, although it has proven to be more resilient than in the rest 
of the Caribbean.  There were declines in border tax and consumption tax collections. 
8. Sharp swings in import prices had a strong impact on inflation rates, which peaked at over 
16.8% in 2008, and the current account deficit, which amounted to 18% of GDP in 2008.  However, 
both inflation and the current account balance improved in 2009, reflecting the impact of the decrease 
in oil prices and the easing of food prices as well as the contraction in imports, which exceeded by far that of exports.  The Jamaican dollar came under intense pressure in 2008, depreciating 12.2% in 
relation to the U.S. dollar. 
(i) Fiscal policy 
9. The decline in economic output has had a nega tive impact on Government revenues and the 
recession increased debt servicing costs, consuming th e bulk of government revenues.  The total cost 
of debt servicing (interest and amortization) in the 2009/10 fiscal year was 119% of Jamaica's total 
revenues and grants.  According to the authorities, excep t for three of the last ten years, interest costs 
and principal repayments have exceeded total revenues. 
10. As the global crisis pushed Jamaica into recession, the prospect of an outright debt default 
loomed on its large domestic debt, and with no ec onomic recovery projected in 2010, Jamaica agreed 
a US$1.27 billion Stand-By Arrangement with the IMF
2, which was approved in early 2010.  The plan 
is designed to reverse entrenched fiscal and budg et deficits and re-energize growth, which has 
averaged just over 0.7% for the past 15 years.  As well as wholesale fiscal reform aimed at cutting 
spending and raising taxes, the plan included the sale of Air Jamaica (AJ), the loss-making national 
airline.  The airline was effectively divested on 30 April 2010 and, legally, is no longer an operating 
company.3  The programme also included structural reforms, notably strengthening Jamaica's 
competitiveness by promoting a reduction in the cost s of doing business in the private sector.  Overall 
macroeconomic performance under the pr ogramme has been encouraging. 
11. The Government also launched a comprehensiv e debt exchange in January 2010 to address 
the problem of Jamaica's high debt overhang.4  The Jamaica Debt Exchange (JDX), which saw bond 
holders voluntarily exchanging existing bonds for ne w ones with the same principal value but lower 
interest rates and longer maturities, allows the G overnment to reduce its interest bill and expand the 
maturity profile of the debt stock.  With IM F and other multilateral support, and the country's 
economic programme, the Government aims to reset the cost of its domestic debt and spending 
patterns to a more sustainable level. 
                                                      
2 IMF Press Release No. 10/24, "IMF Execu tive Board Approves US$1.27 Billion Stand-By 
Arrangement with Jamaica", 4 February 2010.  View ed at:  http://www.imf.org/external/np/sec/pr/2010/ 
pr1024.htm.  See also Ministry of Finance and th e Public Service, and Bank of Jamaica (2010). 
3 AJ's assets are currently managed by Caribbean Airlines, which is owned by the Government of 
Trinidad and Tobago. 
4 IMF (2010b), pp.11-14. WT/TPR/S/242 Trade Policy Review 
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12. The Jamaican Government generates a substantia l share of its central revenue from taxes and 
charges on imports, which are seen as critical in the li ght of a structural fiscal deficit.  International 
trade taxes averaged between 27% and 28% of tota l tax revenues during the review period with the 
general consumption tax on im ports and customs duties accounting for most of the revenue. 
13. As part of IMF programme, the Government is committed to scaling back the system of 
waivers on customs duties, tax incentives, and exemp tions to broaden the tax base, reduce distortions 
in the system, and allow a phased reduction in corporate tax rate to a more competitive level.5  A  
freeze in granting discretionary waivers on duties and ta xes is a first step in this process.  To help 
combat the fiscal deficit, the Government is prepari ng to reform the system of waivers at Customs that 
deny the Treasury an estimated 50% of customs reve nue.  The Government is to examine and justify 
the various waivers and tax incentives in place in order to quantify their costs and macroeconomic 
impact including on revenue, debt investment, and growth.  It has announced that it will prepare and 
announce a strategy for the reform of tax incentiv es by December 2010.  At the same time, the 
Government is committed to spearheading the revi val of negotiations on tax coordination under the 
auspices of CARICOM. 
(ii) Trade competitiveness 
14. Jamaica imposes no taxes or quantitative restri ctions on exports and has a number of tax 
incentives intended to encourage exports.  The f our export subsidy programmes, which currently 
benefit from an extension of the transition period  for developing countries under WTO rules, will be 
phased out by 2015.  However, as Jamaican expor ts have continued to stagnate, there may be 
structural problems with competitiveness, whic h the incentive programmes can only partially 
alleviate. 
15. To improve economic growth, Jamaica needs to increase the growth of its exports since it is 
an open economy with only a small domestic market.  Weak export performance is of concern in view 
of the increasing erosion of trade preferences, which benefit over 50% of Jamaica's merchandise exports.  The lack of competitiveness of the Jama ican economy is sometimes cited as the main 
contributor to its weak export performance and the relatively weak growth performance overall. 
16. Jamaica's low external compe titiveness reflects its relatively high costs of doing business, 
high trade costs, and low labour productivity.  A ccording to the Planning Institute of Jamaica's 
analysis of factors expected to create a competitiveness-supporting business environment, 
considerably more remains to be  done to enhance the business climate and the global competitiveness 
of Jamaica's merchandise export sectors.
6  Significant competitive disadvantages for Jamaica include:  
high infrastructure costs, the business costs of cr ime and violence, government debt, the burden of 
government regulation, taxation a nd burdensome customs procedures7, and low labour productivity. 
                                                      
5 The IMF has noted that while the magnitude of waiv ers is not accurately known, some studies suggest 
an impact on revenue collections of more than 10% of GDP.  Furtherm ore, the Minister of Finance has 
requested assistance from the Fund to carry out a compre hensive audit of tax incentives (IMF, 2010a, p. 11). 
6 Planning Institute of Jamaica (2009b).  The World Bank pointed out in 2004 that "policies that 
improve international competitiveness and increase pro ductivity are the key to growth in Jamaica's open 
economy" (World Bank, 2004). 
7 According to the latest World Bank Doing Business Report, between 2006 and 2010, the two main 
areas of deterioration were trading acro ss borders, because of increasing impor t costs;  and paying taxes, due to 
the number of different tax types, payment dates and tax rates, which act as a competitive disadvantage.  
However, the World Bank ranking places Jamaica sixth among the 15 Caribbean  countries in the survey, with 
the top two (Puerto Rico and St Lucia) ranked 35th and 36th overall, respectively.  Jamaica was ranked 75th 
overall (63rd in 2006). Jamaica WT/TPR/S/242 
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17. The Government is aware that increasing labour  productivity is a critical means of enhancing 
international competitiveness.  However, Government data8 show that between 1990 and 2003, annual 
average labour productivity growth was very low, at 0.04% which compares unfavourably, for exampe, with Trinidad and Tobago (4.5%) and the Dominican Republic (2.4%).  Data for 2005-09 
show an overall decline in labour productivity of 0.8%.
9  The Government attributes the low 
aggregate productivity performance to, inter alia :  high public debt;  real wages and unit labour costs 
rising faster than labour productivity;  high cost of cap ital;  impact of crime;  inadequate investment in 
human and physical capital and in science and technology10;  and poor labour-management relations.  
In an effort to remedy this situation, the Jama ica Productivity Centre (JPC) is drafting a strategy 
document, aimed at increasing labour productivity, in  consultation with the organizations representing 
workers and employers, with the objective of finalizing it in 2011.  A policy on flexible work arrangements has been approved in the Jamaican Houses of Parliament. 
18. The high cost of electricity is widely rec ognized as a significant impediment to Jamaica's 
competitiveness across all sectors.  At retail rates th at have risen as high as U$0.34 per kWh, the cost 
of energy has an adverse impact on competitiv eness as well as on the welfare of the population.
11  
High energy costs are due to, inter alia , the high dependence on imported petroleum, old and 
inefficient generation, transmission, and distribu tion, infrastructure and technical losses (including 
electricity theft).  Tourism and hotels (5%) and the bauxite and alumina industry (40%) account for a 
major portion of electricity demand.  As part of the fuel diversification and infrastructure 
modernization strategy, the Government has recently  introduced liquefied natural gas (LNG) as the 
fuel of choice for the diversification of the country 's energy source.  According to the authorities, the 
use of LNG is expected to significantly reduce the co st of energy/electricity and have a positive effect 
on the country's competitiveness, and is being target ed for the next set of electricity generators. 
(iii) Current account deficit 
19. In recent years, the external trade sector has been characteri zed by relatively weak export 
growth, a steady increase in the value of imports and the effects of the global recession, resulting in a 
deteriorating trade balance, whic h is only partially offset by the positive services balance.  Net 
transfers in the form of remitta nces from Jamaicans residing abro ad have been an increasingly 
important factor in moderating the current account deficit. 
20. The trade deficit is traditionally large.  Jamaica has a relatively narrow export base, 
comprising mainly alumina/bauxite and some non- traditional exports, and is highly dependent on 
imported raw materials, oil, and capital goods.  Im ports of goods and services represent over 70% of 
GDP, heavily outweighing exports, which are under 40%;  imports of goods are more than three times 
the value of exports. 
21. The trend during the review period has been one of persistent double-digit merchandise and 
current account deficits.  The Jamaican economy faces a significant structural deficit because of 
stagnant growth in exports and st eady growth in imports.  To some  extent, the trade imbalance is 
offset by a surplus in service transactions, reflecti ng tourism exports and larg e inward inflows of net 
                                                      
8 Planning Institute of Jamaica (2009c), p. 22 and p. 24. 
9 Jamaica Productivity Centre, cited in Planning Institute of Jamaica (2010), p. 21.14. 
10 According to the PIJ, Jamaica spends around 0.4% of GDP on science and technology pursuits. 
11 World Bank (2010), p. 16.  The Jamaican authorities also provided data from a Caribbean Electric 
Utility Service Corporation (CARILEC) survey carried out in late 2009, which revealed that Jamaica Public 
Service Company rates are lower than those in many Caribbean countries.  Accord ing to the survey, which 
compared some 18 territories, Jamaica ranked 7th, 9th, and 10th for industrial, residential, and commercial rates, 
respectively. WT/TPR/S/242 Trade Policy Review 
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remittances from Jamaican workers abroad.  The external current account balance has deteriorated 
markedly since 2006, reflecting primarily the increase in the oil bill. 
22. In 2009/10, the external current account defic it was expected to narrow from 18.6% of GDP 
to 7.6%, as the contraction in imports exceeded that of  exports.  It is projected to continue to narrow 
gradually, to around 5% over the medium term, base d on the recent depreciation of the currency in 
real effective terms and the expected increase in national saving as a result of fiscal consolidation. 
(3) TRENDS IN TRADE AND FOREIGN DIRECT INVESTMENT  
(i) Merchandise trade 
23. As a small, open, island economy, Jamaica is dependent on international trade, both on the 
production side for exports and in particular in terms of the share of consumption generated by 
imports.  The ratio of merchandise exports plus im ports to GDP increased from around 51% to 68% in 
2008, although due to the economic downturn the ratio returned to an estimated 47% of GDP in 2009.  
The merchandise trade deficit contracted significan tly in 2009, reflecting a decline of 40% in the 
value of imports, which was partially offset by a reduction of 46% in earnings from exports. 
(a) Composition of trade 
24. Jamaica's export structure remains heavily c oncentrated in a few primary products, which 
accounted for about 90% of exports during most of the review period (Chart I.1 and Table AI.1).  
Bauxite and aluminium goods have  dominated with over 60% of e xports for most of the review 
period.  In 2009, alumina export volumes were af fected by the weak global economy and declines in 
world prices, and resulted in the closure of three al umina plants.  Chemical and mineral fuel exports 
have grown significantly due to the growth of ear nings from ethanol as well as an increase in the price 
of fuel on the international market.  Also importa nt are foods, largely sugar, bananas, coffee, and 
cocoa, although their share of exports has declined from nearly a quarter to around one sixth of total 
merchandise exports.  There were no banana exports by the country's major exporter in 2008, due to 
the destruction of the crop by tropical storm Gustav.  Free-zone exports (generally products processed 
from imported inputs in one of Jamaica's free zones and re-exported) and goods procured in ports by 
foreign carriers accounted for 2.2% and 5.5% of total exports, respectively, in 2008. 
25. There is considerably more balance across co mmodity groups in Jamaica's import structure 
(Table AI.2).  Jamaica imports significant amounts of  raw materials and industrial inputs.  The largest 
categories are mineral fuels (petroleum products), fo od, machinery, and transport equipment including 
motor vehicles, chemicals, including ethanol feed stock, and medicinal and pharmaceutical products.  
The significant reduction in spending on mineral fu el imports, from 40% of total imports in 2008 to 
27% in 2009, was largely associated with the declin e in the average international price of crude oil 
during 2009.  Weak domestic demand, partly re flecting the lagged impact of the global economic 
crisis, also resulted in a decline in the amount of fuel imported. Jamaica WT/TPR/S/242 
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Chart I.1
Merchandise trade by product, 2003 and 2009
2003 2009
(a)    Exports and re-exports (f.o.b.)
Total: US$1,194 million
(b)    Im ports (c.i.f.)
Manufactures
Total: US$3,617 million Total: US$5,064 million
Source:    UNSD, Comtrade database (SITC Rev.3).Total: US$1,316 millionSugars
5.6%
Beer
2.9%
Alumina
57.7%Other 
agriculture
13.4%Other manuf.
2.6%Machinery
1.5%
Agri.Chemicals
4.9%Spirits
3.9%
Other 
agriculture
13.6%
Alumina
27.7%Other mining
23.9%Chemicals
15.5%Other manuf.
3.4%
Sugars
5.5%
MiningAgrilculture
Mining
Other 
agriculture
1.3%
Chemicals
12.3%Other semi-
manuf.
10.1%Machinery & 
transport eqpt.
24.5%Other manuf.
7.0%
Other mining
0.5%Fuels
20.9%Not specified
1.6%
Food
15.1%
Chemicals
14.6%Other 
agriculture
0.9%Food
18.1%
Agri.
Manufactures
MiningAgri.
Mining
Fuels
27.6%
Other 
mining
0.5%Other semi-
manuf.
8.2%Machinery & 
transport eqpt.
16.2%Other manuf.
7.2%Not specified
2.4%Spirits
2.5%
Manuf.
Manuf.Other mining
10.5%Machinery
3.1%
Automotive 
products
6.7%Automotive 
products
4.3%Beer
1.4%Not specified
0.4%
 WT/TPR/S/242 Trade Policy Review 
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(b) Direction of trade 
26. A very large proportion of Jamaica's merchandi se exports go to developed countries.  The 
United States, Canada, and the EU together took over 90% of Jamaica's exports in 2009, up from 77% 
in 2003 (Chart I.2 and Table AI.3).  The EU's share, at around 30% during the review period, reflects 
the influence of trade preferences, including for bananas and tropical products. 
27. Jamaica's import structure has remained more or less stable over the review period, with the 
Americas, Europe, and Asia accounting for on aver age around 77%, 10%, and 10% of total imports, 
respectively (Table AI.4).  Jamaica's largest s ource of imports remains the United States with over 
37% in 2009.  Much of this trade is in food, machinery, motor vehicles, industrial inputs, and 
materials for assembly and exports.  Other countries in the Americas have increased their share to 
around 40% of total imports, with Trinidad and Tobago, Venezuela, and Mexico as the main 
suppliers.  This shift in the origin of imports refl ects to some extent the increase in the import bill for 
petroleum and petroleum products, as these countri es are important oil suppliers to Jamaica.  
Jamaica's main trading partner in the region is Trinidad and Tobago, followed by Barbados and 
Guyana.  Jamaica's considerable trade deficit w ith CARICOM reached US$1,531 million in 2008;  the 
largest deficit is with Trinidad and Tobago, wh ich supplies a large amount of Jamaica's petroleum 
imports.  The deficit declined to US$671 million in 20 09, mainly reflecting the fall in crude oil prices. 
(ii) Trade in services 
28. Jamaica continues to run its traditional surp lus in services, which averaged US$565 million 
for the period up to 2009, when exports of services totalled almost US$2.7 billion while imports were 
around US$1.9 billion (Table I.2).  The main surplus is posted in tourism (travel) for which estimated 
net foreign earnings amounted to US$1.9 billion in 2008 and in 2009.  Net earnings from services 
increased by an estimated 73% (to US$770 million) in  2009, influenced primarily by declines in the 
deficits on transportation (associated with a decrease in freight charges on lower volumes of imported goods) and other services. 
Table I.2 
Trade in services, 2003-09 (US dollar) 
 2003 2004 2005 2006 2007 2008 2009
a 
Services balance 552.4 578.8 607.3 627.7 424.8 428.1 769.9 
Exports 2,138.3 2,297.1 2,329.4 2,648.8 2,706.7 2,795.5 2,650.6 
Transportation 474.3 497.3 451.1 459.0 447.2 469.2 344.2 
Travel 1,355.1 1,438.0 1,545.0 1,870.1 1,910.0 1,975.9 1,925.5 
Other services of which: 308.9 361.8 333.3 319.7 349.5 350.5 380.9 
Insurance 8.4 9.1 14.2 13.8 12.4 10.6 8.4 
Communication 144.6 192.8 148.4 147.8 66.9 42.5 52.6 
Financial services 26.3 27.7 50.4 40.4 27.3 29.2 36.6 
Computer and information 36.0 33.1 34.5 28.8 14.9 16.6 9.1 
Imports 1,585.9 1,718.3 1,722.1 2,021.1 2,281.9 2,367.1 1,880.6 
Transportation 617.9 641.0 717.7 885.4 987.6 1,113.6 785.4 
Travel 252.4 286.5 249.3 273.4 298.2 268.2 216.4 
Other services 715.6 790.8 755.1 862.3 996.1 985.3 878.8 
Insurance 97.1 124.2 133.8 168.2 180.2 194.6 154.2 
Communication 45.9 48.3 47.2 79.6 72.4 42.2 46.3 
Financial services 16.3 31.9 34.2 42.7 25.8 24.1 42.3 
Other business services 469.5 447.2 458.5 476.1 539.3 546.3 445.2 
a Preliminary. 
Source:  Bank of Jamaica, BOP data. Jamaica WT/TPR/S/242 
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Chart I.2
Merchandise trade by main orig in and destination, 2003 and 2009
2003 2009
(a)    Ex ports and re-ex ports (f.o.b. )
Total: US$1,194 million
(b)    Im ports (c.i.f.)
Total: US$3,617 million Total: US$5,064 million
Source:    UNSD, Comtrade database (SITC Rev.3).United 
Kingdom
12.8%
Total: US$1,316 millionCanada
16.1%Others
1.8%
United States
28.6%
Canada
10.0%Other America
7.0%Other Europe
14.1%
Canada
2.7%China
8.1%Other Asia
2.4%
AmericaUnited States
49.3%
EFTA
3.8%
Netherlands
5.2%Other America
8.9%China
1.3%
Netherlands
2.7%EFTA
7.1%Other Europe
5.5%Other 
Asia
3.9%Others
1.4%
EuropeAsia
AmericaEuropeAsia
United States
43.6%
Venezuela
1.4%Other America
26.6%EU (27)
10.8%Other Europe
1.6%Japan
4.9%
China
2.3%Other Asia
3.7% Others
2.5%
United States
36.8%
Venezuela
12.8%Canada
2.1%Other America
24.7%EU (27)
8.0%Other Europe
2.1%Japan
2.3%
China
4.5%Other Asia
4.2% Others
2.5%
AmericaAmericaEuropeEuropeAsiaAsiaUnited 
Kingdom
9.9%
 WT/TPR/S/242 Trade Policy Review 
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(iii) Foreign direct investment (FDI) 
29. The stock of FDI has increased substantially since the mid-1990s to reach around 
US$1.4 billion.  Direct investment inflows have averaged around 6% of GDP during the review period with investment in the bauxite industry, communications and tourism accounting for most of 
the flows in recent years. 
30. The tourism and mining sectors have been significant contributors to FDI whilst the 
IT/telecoms sector has emerged since 2007 as a ma jor contributor, with FDI inflows in ICT 
surpassing those for tourism and mining in 2008 (Table  I.3).  Tourism inflows have been consistent 
with slight increases between 2005 to 2008, which is largely attributed to th e investments associated 
with the construction of new Spanish hotels.  Fo r the period under review, tourism constituted the 
largest percentage for JAMPRO facilitated inflows each year. 
Table I.3 
FDI inflows by sector, 2005-09 
(US$ million) 
 2005 2006 2007 2008a 2009 
Agricultural, manufacturing, and distribution 118.9 40.8 46.7 75.2 23.5 
Information technology and comm unication 55 58.2 164.5 257.0 136.6 
Minerals and chemicals 12.8 11.6 5.2 2.3 0.0 
Insurance 0.0 0.0 0.0 0.0 0.0 
Tourism 106.7 185.7 196.9 196.0 155.4 
Mining 111.6 335.8 216.6 74.2 30.8 
Other 75.9 118.1 59.3 714.3b 32.8 
Sub-total 480.9 750.1 689.2 1,319.0 379.1 
Retained earnings 201.6 132.1 177.3 117.5 161.8 
Total 682.5 882.2 866.5 1,436.6 540.9 
a Preliminary. 
b Include inflows arising from the acquisiti on of majority shareholdings in a local conglomerate by a Trinidadian business inte rest. 
Source:  Figures provided to the WTO Secretariat by the Ba nk of Jamaica, based on da ta from the Planning and 
Development Division of JAMPRO. 
31. The decline in FDI in the mining sector from US$336 million in 2006 to US$74 million in 
2008 is linked, according to the Jamaican authorities,  to the global economic downturn and decline in 
bauxite exports.  Increased investment in the telecommunication sector, including more service 
providers, has contributed significantly to FDI inflows since the last review.  The high levels of expenditure and job creation in the sector were fuelled by the ongoing work of certain telecoms firms, 
and expansion of some of the larger contact cen tre/business process outsourcing operators.  The ICT 
industry will continue to focus on telecommuni cations, business process outsourcing activities and, 
with renewed attention, software development. 
(4) O
UTLOOK  
32. According to the authorities, the rate of d ecline in the Jamaican economy in 2010 will slow 
appreciably compared with 2009, due mainly to continued growth in agriculture and mining, and the recovery in the economies of Jamaica's major tour ist markets in North America.  Real GDP is 
projected by the IMF to increase by 0.5% in FY 2010/11.  The re-opening of the Windalco Alumina 
plant in mid 2010, several months ahead of sche dule, is a positive development.  Given weak 
domestic demand, price pressures are expected to re main subdued and inflation is projected by the 
IMF to decline to below 8% by the end of FY 2010/11. Jamaica WT/TPR/S/242 
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33. The external current account deficit is projected to continue to continue  to narrow gradually 
to around 5% over the medium term, based, acco rding to the Bank of Jamaica, on the recent 
depreciation of the currency in real effective term s and the expected increase in national saving as a 
result of fiscal consolidation.  Improved invest or confidence is expected to influence some 
normalization in private capital flows and improved flows are also expected from remittances.  The 
main downside risks to the outlook concern extern al factors such as shocks to international 
commodity prices, higher than anticipated oil prices,  a slower than expected recovery in the world 
economy, and adverse weather, which could temper gains in the agriculture sector.