Jamaica's Economy Grew By 4.2% In Q1 2023

  • Total value added at constant prices for the Jamaican economy increased by 4.2 per cent in the first quarter of 2023 when compared to the first quarter of 2022. This was attributed to growth in the Services and Goods Producing Industries of 5.4 per cent and 1.0 per cent, respectively. The performance of the economy reflected the sustained recovery from the impact of the COVID-19 pandemic. This outturn was significantly higher than the 2.7% preliminary estimate put forward by the PIOJ.
  • The increase in the Services Industries was due to improved performance in all industries, except for the Producers of Government Services which declined by 0.3 per cent. Growth was recorded for Hotels & Restaurants (29.7 per cent), Other Services (13.0 per cent), Transport, Storage & Communication (7.1 per cent), Wholesale & Retail Trade; Repairs; Installation of Machinery & Equipment (2.8 per cent), Real Estate, Renting & Business Activities (2.3 per cent), Finance & Insurance Services (1.9 per cent) and Electricity & Water Supply (0.7 per cent). The performance of the Hotels & Restaurants industry was positively impacted by a 45.5 per cent growth in foreign national arrivals to the island.
  • Within the Goods Producing Industries, higher output levels were recorded for Mining & Quarrying (114.7 per cent) and Manufacturing (3.6 per cent). However, there were declines in Agriculture, Forestry & Fishing and Construction of 6.9 per cent and 4.2 per cent, respectively. The growth in the Mining & Quarrying industry was due to increased output from the JAMALCO plant which was closed in the comparable period of 2022.
  • When compared to the fourth quarter of 2022, the total value added for the economy grew by 1.0 per cent. This was the result of a 1.5 per cent increase in the Services Industries and a 0.6 per cent fall in the Goods Producing Industries. The economy grew by 4.7 per cent for the fiscal year 2022/2023 compared to fiscal year 2021/2022.
  • Meanwhile, the PIOJ estimates that the economy will grow within the range of 2.0 per cent to 3.0 per cent for the June 2023 quarter relative to the June 2022 quarter. The growth projection for FY2023/24 is within the range of 1.0 per cent to 3.0 per cent. All industries are projected to record growth, albeit at slower rates, as base effects wane.
  • The downside risk to the projections include increased factory downtime, particularly in Mining and Quarrying industries, weather-related shocks that could affect agriculture, an intensification of geopolitical conflicts leading to a deterioration of supply side conditions and a lower than anticipated external demand for Jamaican goods and services as a result of slower than expected growth in the economies of Jamaica’s main trading partners.

(Source: STATIN)