Jamaica

Phone Code: 001876

Root-level Domain Code: .jm

CIA Info

Background: The island - discovered by Christopher COLUMBUS in 1494 - was settled by the Spanish early in the 16th century. The native Taino Indians, who had inhabited Jamaica for centuries, were gradually exterminated, replaced by African slaves. England seized the island in 1655 and a plantation economy - based on sugar, cocoa, and coffee - was established. The abolition of slavery in 1834 freed a quarter million slaves, many of which became small farmers. Jamaica gradually obtained increasing independence from Britain, and in 1958 it joined other British Caribbean colonies in forming the Federation of the West Indies. Jamaica gained full independence when it withdrew from the federation in 1962. Deteriorating economic conditions during the 1970s led to recurrent violence as rival gangs affiliated with the major political parties evolved into powerful organized crime networks involved in international drug smuggling and money laundering. The cycle of violence, drugs, and poverty has served to impoverish large sectors of the populace. Nonetheless, many rural and resort areas remain relatively safe and contribute substantially to the economy.

Economy Overview: The Jamaican economy is heavily dependent on services, which now account for more than 60% of GDP. The country continues to derive most of its foreign exchange from tourism, remittances, and bauxite/alumina. Jamaica's economy, already saddled with a record of sluggish growth, was hit hard by Hurricane Ivan in late 2004, but has made a gradual recovery. But the economy faces serious long-term problems: high but declining interest rates, increased foreign competition, exchange rate instability, a sizable merchandise trade deficit, large-scale unemployment and underemployment, and a high debt burden - the result of government bailouts to ailing sectors of the economy, most notably the financial sector in the mid-to-late 1990s. Following a strategy begun in 2004, Jamaica has reduced its public debt to 133.3% of GDP. Inflation also had declined to 5.8% at the end of 2006. High unemployment exacerbates the serious crime problem, including gang violence fueled by the drug trade. The government faces the difficult prospect of having to achieve fiscal discipline in order to maintain debt payments while simultaneously attacking a serious and growing crime problem that is hampering economic growth.

Geography Note: strategic location between Cayman Trench and Jamaica Channel, the main sea lanes for the Panama Canal

Location: Caribbean, island in the Caribbean Sea, south of Cuba

Natural Resources: bauxite, gypsum, limestone

Geographic Coordinates: 18 15 N, 77 30 W

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