Jamaica is a mixed economy with both state enterprises and private sector businesses. Major sectors of the Jamaican economy include agriculture, mining, manufacturing, tourism, and financial and insurance services. Tourism and mining are the leading earners of foreign exchange. Half the Jamaican economy relies on services, with half of its income coming from services such as tourism. An estimated 1.3 million foreign tourists visit Jamaica every year.
Supported by multilateral financial institutions, Jamaica has, since the early 1980s, sought to implement structural reforms aimed at fostering private sector activity and increasing the role of market forces in resource allocation. Since 1991, the government has followed a programme of economic liberalization and stabilization by removing exchange controls, floating the exchange rate, cutting tariffs, stabilising the Jamaican currency, reducing inflation and removing restrictions on foreign investment. Emphasis has been placed on maintaining strict fiscal discipline, greater openness to trade and financial flows, market liberalisation and reduction in the size of government. During this period, a large share of the economy was returned to private sector ownership through divestment and privatisation programmes.
The macroeconomic stabilisation programme introduced in 1991, which focused on tight fiscal and monetary policies, has contributed to a controlled reduction in the rate of inflation. The annual inflation rate decreased from a high of 80.2% in 1991 to 7.9% in 1998. Inflation for FY1998/99 was 6.2% compared to 7.2% in the corresponding period in CUU1997/98. The Government of Jamaica remains committed to lowering inflation, with a long-term objective of bringing it in line with that of its major trading partners.
After a period of steady growth from 1985 to 1995, real GDP decreased by 1.8% and 2.4% in 1996 and 1997, respectively. The decrease in GDP in 1996 and 1997 was largely due to
