EPOC Co-Chair Expects Growth Momentum to Continue

Co-Chair of the Economic Programme Oversight Committee (EPOC), Richard Byles, has described the 1.1 per cent growth in gross domestic product (GDP) for the April to June quarter as “pretty good”, and that he expects the country to continue this momentum.

Addressing the Committee’s monthly press briefing at the Sagicor head office in New Kingston, yesterday (September 13), Mr. Byles said the Planning Institute of Jamaica (PIOJ) estimate of 1.1 per cent is a “good, strong number” and shows a continuation of increasing growth over the last four quarters.

The January to March quarter recorded estimated growth of 0.8 per cent and the previous October to December quarter saw GDP growth of 0.6 per cent.

“There was a build-up in the rate of growth in GDP, and that is excellent. I think what this is saying is that the economy is getting traction and is growing. It is fairly modest, but continuous,” Mr. Byles said.

He noted that Jamaica recorded a positive GDP for 10 of the 14 quarters over the period of the International Monetary Fund (IMF) programme since March 2013.

The last six quarters have been positive.

Mr. Byles said for the April to June quarter, there was an increase of 2.3 per cent in the Goods Producing sectors and 0.8 per cent in the Services industries. Growth in all other sectors remained positive, with the exception of Mining and Government Services.

Additionally, the EPOC Co-Chair highlighted the strong increase of available credit to the private sector, which is at 11.9 per cent. He said this is excellent, particularly when compared to a rate of 4.5 per cent for the same period last year.

“I want to emphasise that this is a good indicator that the economy is getting some traction with the business of growth,” he said.

Meanwhile, Net International Reserves (NIR) stood at US$2.52 billion at the end of August, comfortably in excess of the end-September IMF target of US$1.44 billion.

Mr. Byles further noted that measured against the Government’s budget, the country produced a primary surplus of $36.4 billion for July, also considerably ahead of the budgeted $14.2 billion.

He pointed out that this overachievement is, in part, driven by increases in tax revenues, which is more than $7 billion above budget, as well as by expenditures being $14.1 billion below budget.

Revenue collection for the first four months of the fiscal year was $153.8 billion, significantly head of the same period last year.

The Statistical Institute of Jamaica (STATIN) has also reported that inflation for July was 0.5 per cent, which was down from the slight spike of 0.9 per cent in June. The calendar year-to-date inflation rate to July 2016 was -0.1 per cent, while the 12-month trailing inflation rate was 2.1 per cent.