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JIS News

Director General of the Planning Institute of Jamaica(PIOJ), Dr. Wesley Hughes has indicated that the Jamaican economy is beginning to return to some form of normalcy following the battering it took from recent hurricanes.
Dr. Hughes told journalists at the PIOJ’s quarterly press briefing held at its New Kingston offices today (November 15) that the goods producing sector grew by 6.1 per cent while the services sector increased by 0.8 per cent. “This was partly a recovery from the downward situation we had the previous year, which was significantly affected by other external events so what we are seeing is a form of normalization of the economic trends in the economy,” he stated.Real Gross Domestic Product (GDP) for the July to September quarter grew by an estimated 2.7 per cent relative to the corresponding period in 2004.
He further informed that economic activity during the review quarter was affected by the damage to infrastructure and productive assets caused by a number of external shocks such as Hurricanes Dennis and Emily.
The cost of the damage and loss associated with the hurricanes saw the productive sector recording losses of some $747 million while the social sector sustained loss of more than $260 million and infrastructure losses amounted to some $4.8 billion. Other incidentals in relation to emergency operations and environmental impact totalled approximately $5.97 billion.
“As you can see, this would have had a very significant impact on budgetary situation because increased expenditure would have been called for, but in addition there would have been a loss of revenue,” he said.
Gross performance during the period, Dr. Hughes said, “should also be viewed against the background of external shocks and in general these were not favourable”.
He further informed that, “there was a general upward movement in interest rates in the United States.
There was a general sharp upward movement in oil prices globally and so when you look at the external picture and the internal shocks the economy was operating in a very unstable environment and imparted some fairly negative impact overall on our situation”.
Meanwhile, the Director General said specifically the main growth sectors were mining and quarrying, which grew by 16.2 per cent, construction by 6.7 per cent, manufacturing up 3.0 per cent, and electricity and water up by 10.5 percent.
For the review quarter, the goods producing sectors performed reasonably well, growing by 6.1 per cent.
Agriculture also showed some recovery of some 2.5 per cent. “Agriculture showed some recovery from the battering that took place over the previous three quarters again reflecting the very significant shocks that we suffered such as hurricanes, drought, even fire in St. Elizabeth and that showed some improvement of about 2.5 per cent,” he said.
Meanwhile, inflation for the quarter stood at 4.3 per cent. There was a fiscal deficit of $7.1 billion, which is some $4.3 million more than budgeted. This, Dr. Hughes explained was due to revenue being $7.1 billion less than budgeted and expenditure being $2.7 billion less than budgeted.
Dr. Hughes said the remainder of the year should see GDP growing by 2.9 per cent between October to December. The goods-producing sector, he informed, was expected to improve by 4.5 per cent while the service sector was expected to grow by 1.9 per cent.