Agriculture to Return to Growth in 2025/26

The Planning Institute of Jamaica (PIOJ) projects that the agriculture industry will return to growth in the first half of fiscal year 2025/26.

This follows a decline in the July to September 2024 quarter due to the impact of Hurricane Beryl and other weather events, which will linger into October to December.

“Some crops, impacted by weather events, which continued into October to December 2024, require three to six months for recovery,” said PIOJ Director General, Dr. Wayne Henry.

He was addressing the agency’s recent quarterly press briefing.

The passage of Hurricane Beryl and the associated damage and loss disrupted economic activity and adversely affected macroeconomic performance.

The cost of damage and loss was estimated at $32.2 billion or 1.1 per cent of Jamaica’s 2023 gross domestic product (GDP).

“Damage and loss in the infrastructure sector accounted for almost 50 per cent of the total, at $15.9 billion. This was led by damage to transport infrastructure at $10.3 billion, followed by damage to electricity infrastructure at $4.1 billion,” Dr. Henry said.

GDP decreased by 0.4 per cent for the first nine months of 2024 and is anticipated to contract for the remainder of the year.

Dr. Henry said the decline reflected lower real value added of 1.2 per cent for the Goods Producing Industry, as the Services Industry remained flat.

“The most significant declines were recorded for Construction, down 2.9 per cent and Wholesale & Retail Trade, Repairs, Installation of Machinery & Equipment, down 1.4 per cent.

Among the industries that recorded growth for the nine-month period were Hotels & Restaurants, by 2.1 per cent and Finance & Insurance Services, up 1.9 per cent.

Turning to the short-term prospects, Dr. Henry said that all industries, with the exception of Agriculture, Construction; Hotels & Restaurants; and Other Services are expected to record growth.

He noted, however, that the economy will continue to feel the lingering effects of Hurricane Beryl, compounded by several other hydrological events.

He that the Construction industry is anticipated to be impacted by the downturn in capital expenditure on infrastructure works, due to pause on works associated with continued rainfall and the resultant delays in the disbursement of funds.

For the Hotels & Restaurants and Other Services, the continued impact of the travel advisories, as well as industrial disputes that impacted operations at some hotels, are expected to temper the performance.

“Within this context, the economy is anticipated to contract for the remainder of this calendar and fiscal year. For October to December 2024, it is projected that the change in real value added will be within the range of -1.5 to zero per cent, resulting in calendar year out-turn within the range of -1.0 to zero per cent,” Dr. Henry said.