Date: November 21, 2018
The Planning Institute of Jamaica (PIOJ) held their Media Briefing today, discussing the review of the economic performance of Jamaica for the July to September 2018 period.
Dr. Wayne Henry, Director General of PIOJ, highlighted the macroeconomic performance for the July-September 2018. He mentioned that, “Real GDP grew by an estimated 1.9 percent relative to the corresponding quarter of 2017.” Growth in Real GDP was due to a rise in the ‘Goods Producing Industry’ and ‘Service Industry’ which recorded an estimated growth of 5.2 percent and 0.8 percent, respectively.
Production Performance by industry are as follows:
- Agriculture, Forestry & Fishing Industry, up by 0.7 percent. It should be noted that Traditional Export crops went down by 5.5 percent, due mainly to a 72.5 percent contraction in the output of sugarcane. Despite the overall growth, the performance of the industry was negatively impacted by drought conditions which caused low yields and crop losses.
- The Manufacture Industry contracted by 0.8 percent. This performance was link to reduced out from the Food, Beverages & Tobacco and the Other Manufacturing sub-industries. The decline in output for Food, Beverages and Tobacco was related to lower production of Sugar, Molasses, Flour, Rum and Alcohol and Beer & Stout.
- The Construction industry grew by 3 percent during the period. The higher value was due to increased activities in both Building Construction and the Other Construction components. The main driver for the improvement in the Building Construction component was increased activities in the non-residential category, while higher capital expenditure in civil engineering drove growth in the Other Construction component.
- Mining & Quarrying Industry expanded by 54 percent reflecting a growth in the output of alumina. This growth outweighed a decline in crude bauxite production. According to PIOJ, “Alumina production increased 65.7% and reflected higher production at Alpart.”
- Electricity & Water Supply Industry down by 0.1 percent. The outturn was as a result of lower water production, while electricity consumption remained flat. During the period water production slipped 1.7%, impacted by lower rainfall levels in the main catchment areas. Notably, The National Water Commission (NWC) disbursed $1.2 billion through the rehabilitation of portable water in the Kingston Metropolitan Areas (KMA), pumps and tanks rehabilitation projects. Whereas, Jamaica Public Service (JPS) disbursed $2.1 billion in efforts of the construction of a new generation facility, for the 90 Megawatt LNG plant in Old Harbour.
- Transport Storage & Communication Industry, growth of 1.4 percent.
- Wholesale & Retail Trade, Repair and Installation of Machinery, grew by 0.6 percent.
- Finance & Insurance Services, up by 1.2 percent.
- Hotels and Restaurants Industry climbed by 2 percent.
The Director General went on to state that, “the latest update undertaken by the Statistical Institute of Jamaica (STATIN) indicated that the total labour force for July 2018 decreased by 30,100 persons to 1,338,200 persons compared with July 2017. Relative to July 2017, the employed labour force increased by 12,800 persons to 1,226,400 persons.” Notably, this was the highest monthly employment level on record. Additionally, the unemployment rate for July 2018 was 8.4 percent compared with 11.3 percent in July 2017. Dr. Henry stated that, “this was the lowest quarterly unemployment rate on record since 1968.”
Programme Director of Vision 2030 Jamaica, Ms. Elizabeth Emanuel highlighted the progress towards achieving the developmental targets as set out in the medium-term socio-economic policy framework (MTF). She noted that, “at the previous quarterly press briefing in August 2018, it was stated that the fourth implementation of the medium-term framework was near completion. She further indicated that the document has been completed and will be reviewed by a large number of stakeholders and will be presented to the Cabinet in short order for their review.” With respect to the period 2015 to 2018, Jamaica saw developmental gains in several areas which includes human capital development, macroeconomic stability, reduction in unemployment, increases in the non-fossil fuel based energy, governance particularly in the areas of control of corruption and governance effectiveness as well as key economic sectors mainly in the tourism, agriculture and infrastructural development.
In concluding, the Jamaican economy is estimated to have grown by 1.9 percent for the July-September 2018 quarter based on early indicators. This growth out-turn was supported by several positive macroeconomic developments including the attainment of the lowest ever unemployment rate and the continued increase in the level of employment which boosted domestic development, robust level of capital investments in the construction industry facilitating improved roads and water infrastructure. Also, there was an uptick in both business and consumer confidence levels and greater levels of macroeconomic stability, evident by relatively low inflation, a decline in interest rates and an improved fiscal out-turn being recorded.
With respect to the Vision 2030 Jamaica, the National Development Plan, a review of the 2015-2018 socio-economic policy framework indicates that improvements were made in the key social economic and environmental indicators of development. This suggests that some progress was made towards achieving Jamaica’s developmental goals. The near-term outlook for Jamaica remains positive with the projection for growth for the calendar year and for the fiscal year 2019 are both anticipated to fall between the range of 1.5% to 2.5%. Despite the occurrence of developmental challenges, initiatives have been established and are being implemented to address most of the constraints identified.
The General Director concluded his presentation by stating that, “It is therefore critical that we remain focused and disciplined as a country, as we intensify our efforts to realize greater levels of economic growth and sustained improvements in the well-being of our people. In addition, the Company is committed to making Jamaica the place of choice to live, work, raise families and do business.”