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Jamaica emerges as safe haven for investors, says Jefferies’ exec

Loop Business News

January 24, 2025 09:00 AM ET

Gregory Fisher, Managing Director at Jefferies Group, LLC, an international full-service investment banking firm.

Jamaica’s transformation from a high-yield risk to a stable, investment-grade-like credit environment is cementing its position as a safe haven for investors, according to Gregory Fisher, Managing Director at Jefferies Group, LLC, an international full-service investment banking firm.

Speaking at the Jamaica Stock Exchange (JSE) Regional Conference this week, Fisher highlighted the nation’s disciplined fiscal management and economic resilience as key factors driving this newfound reputation.

“Jamaica’s bonds are behaving more like their investment-grade peers, reflecting remarkable fiscal discipline and leadership,” Fisher said. He pointed to the reduction of the country’s debt-to-GDP ratio from 94 per cent to 73 per cent in the post-COVID period—a feat few nations, developed or developing, have been able to replicate.

Jamaica’s journey from a debt restructuring candidate a decade ago to a model of fiscal stability is a testament to deliberate policy reforms and strong leadership. Fisher noted that Jamaica’s international bonds are now less volatile and more aligned with global market expectations, making them attractive to conservative investors.

“This is no small accomplishment. It has taken years of heavy lifting to achieve this level of confidence in the international markets,” he remarked.

While Jamaica’s credit ratings remain below investment grade, the outlook is positive, and the spreads on its bonds have tightened significantly. According to Fisher, this stability makes Jamaica a compelling option for investors seeking security amid global market volatility.

However, this newfound safe haven status presents its own challenges. With Jamaica’s bond spreads now tighter, they may be less appealing to investors seeking high returns. Fisher acknowledged that attracting international interest will require sustained fiscal discipline and strategic market positioning.

“Jamaica must continue its trajectory to remain competitive, even in a tighter credit environment,” he said.

Fisher also called for an increase in corporate and quasi-sovereign issuance, highlighting the successful transaction surrounding Norman Manley International Airport as a prime example of what Jamaica can achieve. Expanding the pool of investment options, he reasoned, could enhance the country’s appeal to international investors.

Fisher framed Jamaica’s fiscal transformation as a blueprint for other emerging markets. By adhering to strong fiscal policies and leveraging strategic investments, the country has positioned itself as a leader in the Caribbean and beyond.

“Jamaica’s progress is extraordinary. It’s not just a regional success—it’s an example for the world,” he said.

Despite this success, Fisher noted that Jamaica’s trajectory is still closely tied to global economic trends, particularly US treasury yields. “Jamaica bonds are now behaving more like their investment-grade counterparts, meaning their returns will be increasingly governed by movements in U.S. treasuries,” he explained.