JIS News

Director General in the Office of the Prime Minister, Dennis Morrison has cited the active hurricane season coupled with periods of drought and high energy prices, as main forces that impacted significantly on Jamaica’s economy during 2005.
According to Mr. Morrison, the immediate economic plan involved four objectives: returning the economy to single digit inflation; balancing the fiscal deficit; gaining gross domestic product (GDP) growth momentum; and maintaining healthy foreign exchange reserves.
He was addressing a recent JIS Think Tank where he spoke on the country’s investment portfolio whilst addressing the current overall economic situation.Summing up the year, Mr. Morrison acknowledged that 2005 was indeed very challenging for Jamaica because of the weather as well as energy prices that soared to a new high in nominal terms since the early 1980s. “Those two variables drove inflation in 2005 as they did in 2004 and would have blown us off course in terms of the inflation rate that was set,” stated Mr. Morrison.
“Looking ahead,” he continued, “we need to plan ahead of bad weather so that when active hurricane seasons come, supplies are maintained at normal levels so that prices do not have to jump in the way that they did last year (2004) and this year.”
The OPM Director General pointed out that over the years, the macro economy has been the preoccupation of the government and other stakeholders in the local and international financial and investment community.
“The people, who make decisions about our economy locally and internationally include the financial and investment community in Jamaica, the international financial institutions and international banks. These are the people who make decisions as to whether to lend to the country, government or otherwise, at what interest rate and for what term,” he explained.
Meanwhile, Mr. Morrison indicated that construction and installation were the fastest growing merchandise sectors. “The construction industry is quite active as production has now increased tremendously to match the local demand,” he noted.
He said the Carib Cement was in an expansion mode with capacity set to double to 1.2 metric tons per year (MTPY) and other investors were eyeing the cement market with a prospect looking at investment at Port Esquivel to produce 600 metric tons.
Turning to the bauxite industry, Mr. Morrison emphasized that bauxite production was estimated to grow at a rate of 4.3 per cent for 2005, with Jamalco’s expansion expected to add 1.5 MTPY.
“With steady increase in foreign exchange earnings over the last four years as well as increased production over the same period, the Halse Hall plant slated to be completed by 2007 will have a capacity of 2.8 MTPY with an additional foreign exchange of US$300 million per annum expected by 2008,” Mr. Morrison outlined.
In relation to the telecommunications sector, Mr. Morrison is anticipating the fibre-optic expansions to lower telecoms rates in the near future.
“Fibralink Jamaica Limited and Trans-Caribbean Cable Company Limited (TCCCL) will invest more than US$80 million in submarine fibre-optic links, which is expected to cut rates by 70 per cent in the 06/07 fiscal year,” he commented.
He further pointed out that the expansion should spur Jamaica’s development into an international business centre.
To date, over US$500 million has been invested in telecommunications infrastructure and more is expected to come on stream shortly.