Director General of the Planning Institute of Jamaica (PIOJ), Dr. Gladstone Hutchinson, is reporting flat growth of 0.1 per cent for the April to June 2012 quarter.
He informed that the modest gross domestic product (GDP) outturn occurred against the background of a relatively stable macroeconomic environment, with better than expected fiscal deficit and continued moderate inflation.
“For April to June 2012, the inflation rate was 1.5 per cent compared to 2.9 per cent for April to June 2011. The fiscal deficit for April to June 2012 was $8.8 billion, which was $1.35 billion lower than budgeted,” Dr. Hutchinson informed on Aug. 21, during the quarterly press briefing at the institute's Oxford Road offices in Kingston.
He attributed the modest growth, which was below the projected range of 0.5 per cent to 1.5 per cent per cent, to the larger than expected contractions in value-added in some key industries.
“The main detractors from economic growth during the review period were: transport, storage and communication at -0.4 percentage point; mining and quarrying, -0.2 percentage point; and construction, -0.2 percentage point. Combined, these industries detracted 0.8 percentage point from GDP growth,” Dr. Hutchinson explained.
However, the main industries contributing to GDP growth during the quarter were: agriculture, 0.5 per cent; hotels and restaurants, 0.3 per cent; and wholesale and retail trade, 0.1 percent, which combined, contributed 0.9 percentage point to GDP growth.
Real value-added for the agriculture industry also grew by8.5 per cent due to improved weather conditions during the review period and intensification of government programmes aimed at improving efficiency in the industry.
“Growth was pushed by: traditional export crops, up 7.4 per cent; bananas, up 25.4 per cent; cocoa, up 85.3 per cent and coffee, up 19.6 per cent,” Dr. Hutchinson said.
Other agricultural crops contributing to the growth of the sector include yams, which went up 34.0 per cent; fruits, 23.6 per cent; plantains, 18.5 per cent; legumes, 11.1 per cent; and postharvest activities, up 48.6 per cent.
The electricity and water industry grew by 0.6 per cent due to improved performance in the electricity component, as water production declined. Gross electricity generation grew by 1.0 per cent due to a 3.4 per cent increase in Jamaica Public Service Company (JPS) generation, which outweighed a decline of 3.1 per cent in non-JPS generation.
Realvalue-added for the hotels and restaurants industry increased by 5.2 per cent and preliminary data indicate that total arrivals grew by 6.5 per cent, due to a 6.2 per cent increase in stopover arrivals, and a 7.2 per cent increase in cruise passenger arrivals. Visitor expenditure increased by an estimated 6.8 per cent to US$516.7 million.
In addition, the wholesale and retail trade industry recorded an increase of 0.5 per cent in real value-added, due to: expansion in the stock of loans and advances for distribution (42.7 per cent) and consumption (23.7 per cent) purposes; and improvements in gross sales levels driven by increases in the volume (12.4 per cent) and value (38.0 per cent) of Automated Banking Machine (ABM) and Point of Sale Transactions, respectively.