The Government’s chief planning agency, the Planning Institute of Jamaica (PIOJ), is reporting Gross Domestic Product (GDP) growth of 0.6 per cent for the first quarter of 2012, relative to the corresponding period last year.
Agriculture, wholesale and retail, and tourism were the main growth drivers, with activities in the goods producing industries increasing by some 1.4 per cent.
Agriculture, forestry and fishing in particular, registered the largest growth of seven per cent, reflecting increased output in traditional export crop (up 15.8 per cent), post-harvest activities (up 16.2 per cent), and other agricultural crops ( 5.6 per cent).
“This improved performance reflected continued strengthening of the economy,” said PIOJ Director General, Dr. Gladstone Hutchinson, on May 30 media briefing at his Oxford Road offices, to review the country’s economic performance for January to March.
Dr. Hutchinson attributed the improved performance in agriculture to a number of factors including favourable weather, and government programmes, which offered assistance to farmers in the areas of marketing, irrigation and extension services.
Meanwhile, manufacturing grew by 0.4 per cent. All categories within the goods producing industries recorded growth except mining and quarrying (down 5.5 per cent), following seven consecutive quarters of growth. Dr. Hutchinson explained that, “this performance was largely attributed to developments in the Eurozone, which resulted in the downward revision in the forecast for global growth and industrial activities”.
Construction also contracted 0.5 per cent, due to declines in all major components of the industry, with 83 per cent reductions in the level of expenditure on civil engineering (road works).
Activities by the Port Authority of Jamaica also declined by 64.5 per cent; Urban Development Corporation, by 71.9 per cent; and telecommunications by 67.6 per cent during the quarter. This, he said, was due to the change in administration and re-prioritizing of spending.
However, increased expenditures were recorded by the National Road Operating and Constructing Company (NROCC), associated with the Sandy Bay to May Pen phase of Highway 2000.
Meanwhile, there was a 0.2 per cent growth in the services industries due to expansion in most areas except transport, storage and communications, and finance and insurance.
Hotels and restaurants also recorded growth of one per cent, reflecting a 0.6 per cent increase in stopovers arrivals and 69.4 per cent growth in cruise-passengers.
This represents the seventh consecutive quarterly increase, and continues to reflect the impact of the larger cruise vessels being accommodated at the Falmouth pier, Dr. Hutchinson. Provisional visitor expenditures for the period amounted to US$620.6 million, which reflects a $4.6 per cent increase in visitor expenditure over the corresponding period.
In other macro economic highlights, inflation for the quarter was 1.7 per cent, with remittance inflows for January and February amounting to US$316.9 million.
Dr. Hutchinson said that while the strengthening of the United States and Canadian economies are expected to boost Jamaica’s external demand for goods and services, developments in the Eurozone will temper this expectation, particularly in the bauxite and alumina industries, where downturn in industrial activities in this region results in weaker prices and demand.
The PIOJ Head said however, that the agency forecasts that the economy will record real GDP growth within the range of 0.5 per cent – 1.5 per cent for the April-June quarter, with most industries expected to experience growth.