PIOJ estimates growth of 6.0% for Q1 2022 GDP

June 2, 2022

  • For the January – March 2022 quarter, real GDP is estimated to have grown by 6.0%, relative to the corresponding quarter of 2021. This out-turn represented the fourth consecutive quarter of growth and reflected a continuation of the recovery trend, following contractions in the corresponding quarter as a result of the COVID-19 pandemic and associated measures implemented to manage its spread.
  • The estimated out-turn was influenced by increased external demand, especially for Jamaica’s Tourism product and increased domestic demand associated with higher levels of employment, and operational hours as more industries gradually returned to normalcy.
  • The Goods Producing Industry is estimated to have declined by 2.1%, due to contraction in the Mining & Quarrying and Manufacturing industries. These contractions outweighed improvements recorded for Agriculture and Construction industries.
  • The Services Industry was estimated to have grown by 8.9%, relative to the corresponding quarter of the previous year, reflecting higher Real Value Added for all industries. This is with the exception of Producers of Government Services, which remained flat.
  • For FY2021/22, real GDP growth was projected to fall within the range of 7.0% to 9.0%. Based on the preliminary out-turn for January to March 2022, the Fiscal Year 2021/22 is estimated to have grown by 8.1% supported by improved performances in all industries, except Mining & Quarrying which contracted by an estimated 39.8%, due mainly to the closure of the JAMALCO alumina plant.


Production Performance by industry:

Real Value Added for the Hotels & Restaurants industry was estimated to have grown by 105.7%. Preliminary data revealed that Foreign National arrivals increased by 230.1% to 475,805 visitors, and Cruise passenger arrivals was 99,798 relative to none in the corresponding quarter. Based on data received for January to February 2022, total visitor expenditure increased to US$485.6 million relative to US$169.2 million in the corresponding period.

Real Value Added for the Mining & Quarrying industry decreased by 64.3%, due to declines in both alumina and crude bauxite production. Alumina production, fell by 74.3%, mainly as a result of no production at the JAMALCO alumina plant, which closed in August 2021 due to a fire at the facility. Crude Bauxite production declined by 2.9%, resulting from lower demand. The Average bauxite capacity utilization rate fell by 1.4 percentage points to 48.6%.

Real Value Added for the Agriculture, Forestry & Fishing industry, was estimated to have grown by 8.6%. The performance of the industry reflected the impact of favorable weather conditions, an increase in hectares reaped, and increased demand associated with the further relaxation of the Public Health and Social Measures (PHSM). Additionally, Government support through initiatives aimed at boosting production and productivity, also contributed positively to output per hectare. The Other Agricultural Crops group was estimated to have grown by 10.4% reflecting increased production in all nine crop groups, as a result of a rise in hectare reaped in all crop groups.

Real Value Added for the Manufacturing industry declined by an estimated 0.7%, due to a decrease in the Other Manufacturing sub-industry, which outweighed an increase in the Food, Beverages & Tobacco sub-industry. In the Other Manufacturing category, lower output stemmed largely from decreases in the Petroleum Products and Non-Metallic Mineral categories. Reductions were recorded for Liquid Petroleum Gas, down 71.9%; Asphalt, down 42.9%; and Gasoline, down 32.9%. The Petrojam refinery was not in operation for 9 days during the quarter to facilitate repairs and maintenance. The Non-metallic Minerals category also declined due to Cement production, down 7.1% and Clinker, down 4.4%.

Real Value Added for the Construction industry increased by 1.1%, reflecting growth in both the Other Construction and Building Construction components. The growth in the Building Construction component was driven by a 1.5% increase in the value of mortgages disbursed by the NHT to $8.1 billion. Real sales of construction inputs grew, with Wholesale of Construction Materials, Hardware & Plumbing up 13.4%; and Retail Sale of Paint & Glass, up 2.9%. The increase in the Other Construction component was due to higher capital expenditure on civil engineering activities reflecting: Jamaica Public Service Company, up 20.9% to $1.4 billion. Secondly, the National Works Agency (NWA), which disbursed $6.6 billion, an increase of 133.1%. Disbursement facilitated work on the Yallahs to Harbour View leg of the Southern Coastal Highway Improvement Project (SCHIP). Lastly, the NROCC, which disbursed $444.8 million, up 61.3% to facilitate works on Part A of the South Coast Highway Improvement Project (SCHIP), that is, the May Pen in Clarendon to Williamsfield in Manchester.

The Electricity & Water Supply industry was estimated to have recorded growth in Real Value Added of 1.4%, reflecting increases in both electricity and water consumption. Electricity consumption increased by 1.7% reflecting higher consumption for four of six categories. General Service (up 4.2%), Power Service (up 2.4%), Large Power (up 9.1%), and Largest Power (up 9.7%).  Water consumption increased by 0.2%, due to higher consumption in the Western division, up 9.3% that outweighed lower consumption in the Eastern division of 4.0%.

Real Value Added for the Transport, Storage & Communication industry grew by 8.1%, mainly due to an estimated increase in the Transport & Storage component, combined with an estimated increase in the Communication component. The growth in the Transport & Storage component reflected the combined effect of:  Significant growth in air transport, largely reflecting increased passenger movements up 187.2%, due to Arrivals (up 199.2%), and Departures (up 171.9%).

Real Value Added for the Finance & Insurance Services industry was estimated to have grown by 1.5%. This performance was influenced by increased profitability at deposit taking institutions, associated with the higher level of economic activities.

Real Value Added for the Wholesale & Retail Trade; Repair & Installation of Machinery (WRTRIM) industry was estimated to have grown by 9.5% due to higher demand stemming from an increase in the employed labour force by 57,800 persons; A relaxation of measures associated with the management of the COVID[1]19 pandemic, which facilitated increased operational hours; and Relatively strong increase in both the Consumer Confidence Index (up 30.1%), and the Business Confidence Index (up 13.8%).



The PIOJ noted that “For April–June 2022, growth prospects for the economy are generally positive. It is projected that the economy will grow within the range 2.0% to 4.0% relative to April–June 2021, based on the continuation of the recovery process, relative to the low output levels recorded in the corresponding period of 2021. Growth during this period is expected to be driven by the Hotels and Restaurants, Other Services and Transport Storage and Communications Industries, reflecting the upturn in Tourism and entertainment activities.”

Furthermore “The projection for FY2022/23 is for growth within the range of 2.0%–5.0%. This revised forecast, down from the previous range of 3.0%–6.0%, takes into consideration the high degree of uncertainty surrounding unfolding global developments, including the impact of geopolitical developments associated with the Russian-Ukraine war.”



Analyst Certification -The views expressed in this research report accurately reflect the personal views of Mayberry Investments Limited Research Department about those issuer(s) or securities as at the date of this report. Each research analyst (s) also certify that no part of their compensation was, is, or will be, directly or indirectly, related to the specific recommendation(s) or view(s) expressed by that research analyst in this research report.

Company Disclosure -The information contained herein has been obtained from sources believed to be reliable, however its accuracy and completeness cannot be guaranteed. You are hereby notified that any disclosure, copying, distribution or taking any action in reliance on the contents of this information is strictly prohibited and may be unlawful. Mayberry may effect transactions or have positions in securities mentioned herein. In addition, employees of Mayberry may have positions and effect transactions in the securities mentioned herein.