Jamaica’s economic expansion continues despite economic shocks
Minister of Finance and the Public Service, Dr Nigel Clarke is pointing to the improving resilience of the Jamaican economy given the economy’s modest expansion, despite external economic shocks, in the third quarter of 2019.
Minister Clarke stated, “STATIN reported earlier this week that the Jamaican economy grew in the June – September quarter of 2019 by 0.6% over the June – September quarter of 2018. Modest economic expansion, therefore, continues despite the closure of the JISCO/Alpart plant in the September 2019 quarter and the corresponding 17.6% decline in output in the important bauxite/alumina sector as a result.”
The Minister noted that news of the JISCO closure has been in the public domain for months and the anticipated economic impact has most probably been priced in. The Minister said, “The closure of JISCO was expected to impact growth in the 3rd quarter of 2019 and is expected to impact the 4th quarter of 2019 as well. However, the fact that the economy still expanded overall, despite a decline of nearly 18% in the critical alumina sector, as a result of the JISCO/Alpart closure, is a credit to the improving economic resilience of the Jamaican economy.”
The Minister highlighted that the international context is important. “ US-China trade tensions and lower global growth have led to declines in the prices of many commodities including alumina, iron ore, soybeans and copper. As a result, growth in Latin America and the Caribbean for 2019 is forecasted by the IMF to average only 0.2%. Though Jamaica is affected by the same external shocks, our 2019 growth is ahead of the Latin American and Caribbean average. It may not be much comfort but this context is nevertheless important.”
Growth in the Jamaican economy in the third quarter of 2019 now makes it 19 consecutive quarters of economic growth, the longest unbroken stretch of economic growth since Jamaica started measuring growth quarterly in 1997. The previous longest unbroken period of consecutive quarterly economic growth was only 9 quarters.
In looking forward to the 2020/21 financial year the Minister noted that there is full expectation that economic growth will return to the previous trajectory prior to the JISCO/Alpart closure. The Minister further disclosed, “The projection is for economic growth for the 2020/21 financial year to return to levels above 1%. The Government will continue to use all levers at our disposal to elevate levels of growth beyond this across the medium term.”