1. No category

Review
of
Economic Performance
January–March 2015
Planning Institute of Jamaica
May 20, 2015
Overview
January to March 2015
 Real GDP grew by an estimated 0.3% for
January–March 2015 relative to the similar
period of 2014.
 Goods Producing Industry contracted by 0.7%
 Services Industry grew by 0.6%
Planning Institute of Jamaica
May 15, 2014
2
Real Value Added Growth in the
Goods Producing Industries (%)
Jan-Mar
2014
Apr-Jun
2014
Jul-Sep
2014
Oct-Dec
2014
Jan-Mar
2015
GOODS
PRODUCING
5.4
6.5
-7.9
-3.9
-0.7
Agriculture
17.3
17.1
-22.9
-12.8
-0.5
Mining &
Quarrying
8.5
-0.3
-2.0
-2.1
0.2
Manufacture
-1.1
4.2
-5.9
-1.7
-3.1
Construction
1.1
1.2
1.7
1.3
1.4
Planning Institute of Jamaica
May 15, 2014
3
Agriculture
 Real Value Added for the Agriculture industry contracted by
0.5%, based on PIOJ’s production index:
 Traditional Export crops, down 11.6% reflecting:
 Sugarcane, down 21.2 %
 Bananas , down 3.8%
 Cocoa, down 60.9%
 Post Harvest Activities and Animal Farming were also
estimated to have declined.
 However Other Agricultural Crops recorded an estimated
increase of 3.5%, reflecting increases in four of the nine crop
groups:
 Vegetables – up 4.9%; Fruits – up 10.0%; Potatoes– up 9.1%; and
Yams – up 4.8%
 This performance largely reflected recovery from
drought conditions which prevailed during the latter half
of 2014.
Planning Institute of Jamaica
May 21, 2015
4
Mining & Quarrying
 Real Value Added grew by 0.2%. Total bauxite
production increased by 0.7% due to increased
global demand for aluminium and reflected the
combined effect of:
 Higher alumina production by 0.2%, reflecting:
 The combined effect of increased production by Jamalco (up
1.3% to 330.9 kilo tonnes) and a contraction in output of 2.2% to
145.9 kilo tonnes at WindalCo.
 Increased average capacity utilization rate at alumina refineries
by 0.1 percentage point to 43.5 %.
 Increased crude bauxite production, up 8.2%
 the bauxite capacity utilization rate increased by 5.5 percentage
points to 95.1%.
Planning Institute of Jamaica
May 21, 2015
5
Manufacture Industry
 Real Value Added was estimated to have declined by
3.1% reflecting:
 A contraction in Other Manufacturing reflecting
declines in:
 four of the six Petroleum Products subcategories
 Non-metallic Minerals (Cement, down 19.9%; Clinker, down
10.5%)
 Chemicals & Chemical Products (Fertilizer, down 22.8%;
Aluminium Sulphate, down 25.8%)
 Food, Beverages & Tobacco was estimated to have
declined, reflecting:
 Sugar, down 24.3%; Molasses, down 16.0%; Poultry Meat,
down 7.1%
 Rum & Alcohol, down 65.0%
Planning Institute of Jamaica
May 21, 2015
6
Construction
 Real Value Added in the Construction industry grew by
1.4%, reflecting:
 An increase in the Other Construction component reflecting
higher capital expenditure by:
 National Works Agency – which disbursed $0.6 billion, up 28.2%
 NROCC which disbursed $5.6 billion compared with $0.8 billion in
January–March 2014
 Telecommunications disbursed $10.5 billion compared with $2.5
billion in January–March 2014
 Building Construction is also estimated to have grown
due to an increase in Non-Residential Construction,
reflecting:
 Increased hotel construction
 Increased construction of office space for the BPO sub-industry
Planning Institute of Jamaica
May 21, 2015
7
Real Value Added Growth in the
Services Industries (%)
Jan-Mar
2014
Apr-Jun
2014
Jul-Sep
2014
Oct-Dec
2014
Jan-Mar
2015
SERVICES INDUSTRY
0.3
0.4
0.7
0.8
0.6
Electricity & Water Supply
0.5
-1.6
-1.1
-2.4
-2.8
Transport, Storage &
Communication
0.7
1.0
1.1
1.6
1.0
Wholesale & Retail Trade;
Repair & Installation of Mach.
0.1
0.1
0.4
0.3
0.3
Finance & Insurance Services
0.1
0.2
0.2
0.4
0.3
Real Estate, Renting &
Business Services
0.6
0.6
0.4
0.5
0.5
Government Services
-0.2
-0.2
-0.2
-0.2
-0.2
Hotels & Restaurants
0.2
2.3
4.1
5.6
4.0
Other Services
0.6
1.1
1.6
1.5
1.5
Planning Institute of Jamaica
May 21, 2015
8
Electricity & Water
 Real value added for the Electricity & Water industry
declined by 2.8% due to:
 Water production, down 0.9% reflecting:
 13.0% decline in production in the Western division
 7.0% increase in production in the Eastern division due largely to
a 288.0% increase in water production in Portland
 Electricity consumption, fell by 2.0% reflecting
declines in all categories largely reflecting a decline
of 21 925 in the average number of customers:
 Residential, down 0.8%
 General Service (small businesses using less than 25 kVa), down
2.7%
 Power Service (large businesses using more than 25 kVa but less
than 500 kVa), down 0.6%
 Large Power (Businesses using more than 500kVa) down, 7.2%
Planning Institute of Jamaica
May 21, 2015
9
Transport, Storage & Communication
 Real Value Added in Transport, Storage &
Communication grew by 1.0%, due largely to
estimated improvement in the two major
components:
 The Communications component is estimated to have
grown consequent on increased competition.
 Transport & Storage grew due to:
 A 8.2% increase in air passenger movements which
outweighed a 3.9% decline in Maritime Cargo handled at
the island’s seaports.
Planning Institute of Jamaica
May 21, 2015
10
Finance & Insurance Services
 The real value added for the Finance &
Insurance Industry grew by an estimated
0.3%, reflecting the combined effect of:
 A real increase in the value of total assets at
deposit taking institutions
 An increase in net interest income on loan stock at
deposit-taking institutions.
Planning Institute of Jamaica
May 21, 2015
11
Wholesale & Retail Trade: Repair and
Installation of Machinery (WRTRIM)
 Real Value Added in the WRTRIM industry grew by
0.3% due to:
 Higher levels of domestic demand reflected in:
 increased business (up 12.0%) and consumer confidence (up
9.2%)
 an increase in the outstanding stock of loans to distributors at
Institutions licensed by the Financial Institutions Act.
 higher volume (up 4.1%) and value (up 13.3% in real terms) of
ABM & POS transactions
 a real increase in remittance inflows for January 2015 (up 7.6 %)
 Growth in the industry was tempered by a decline in the
outstanding stock of loans to consumers.
Planning Institute of Jamaica
May 21, 2015
12
Tourism
Real Value Added for Hotels & Restaurants grew by
4.0%, reflecting:
 Total arrivals, up 9.9% to 1 078 828 visitors
 Stopover arrivals, up 5.0% to 566 560.
 Cruise passenger arrivals, up 15.9% to 512 268
 Total visitor expenditure increased by 5.2% to
US$679.54 million
Planning Institute of Jamaica
May 21, 2015
13
Quarterly Real Value Added Growth (%)
2008-2015
3.0
1.0
Percent
GDP Chart
2.0
0.0
-1.0
-2.0
-3.0
-4.0
-5.0
The Macroeconomic Environment
 This performance during the quarter took place
against the background of:
 Quarterly deflation of 0.6%
 Fiscal surplus of $18.2 billion
 Real depreciation of the exchange rate
Planning Institute of Jamaica
May 21, 2015
15
Inflation by Quarters 2013-2015
5
4.0
4
3.5
 For January–
March 2015
2
1
3.0
Per Cent
Per Cent
deflation was
0.6%
3
2.5
2.0
1.5
1.0
0.5
J-M2014
O-D
J-S
-1
0.0
A-J
0
J-M2013
 For fiscal year
2014/15 inflation
rate was 4.0%.
-2
Planning Institute of Jamaica
May 21, 2015
16
Inflation: Main Components
 Deflation during the quarter largely reflected
declines in:
 Food & Non-Alcoholic Beverages (down 0.9%)
 Housing, Water, Electricity, Gas & Other Fuels (down 4.2%)
 Transport (down 0.8%)
 The out-turn resulted from lower prices for:
 Electricity and Transport categories due to lower cost for
international crude oil
 Starchy Food & Vegetables due to recovery in Domestic Crop
Production.
Planning Institute of Jamaica
May 21, 2015
17
Fiscal Accounts
 A fiscal surplus of $18.2 billion was recorded
during the quarter
 This was $4.2 billion worse than budgeted due to:
 $6.3 billion (4.8 per cent) lower than programmed revenue
 $2.1 billion (1.9 per cent) lower than programmed expenditure
 Revenue & Grants totalled $124.5 billion in
January–March 2015, while expenditure totalled
$106.3 billion.
Planning Institute of Jamaica
May 21, 2015
18
Exchange Rate
 The average nominal exchange rate at the end
of March 2015 was $115.04 per US$1.00,
representing 0.3% nominal depreciation
compared with end of December 2014.
 This
translates into a real exchange
depreciation of 1.5% relative to the US dollar.
rate
External Trade
 External Trade Balance improved by US$52.2
million to a deficit of US$289.2 million at the end
of January 2015.
 Imports for the month declined by 13.0 per cent to
US$401.6 million
 Mineral Fuel imports accounted for 19.0% of total imports.
 Exports for the period
declined by 6.5 per cent to
US$112.4 million.
Planning Institute of Jamaica
May 21, 2015
20
Remittances
 Remittance inflows for January 2015 amounted
to US$166.2 million, up 5.1% relative to the
corresponding period of 2014.
 For the first ten months of fiscal year 2014/15
remittance inflows increased by 4.7% to US$1
811.1 million.
Labour Market Indicators
2014
January
Agriculture, Hunting, Forestry &
Fishing
Mining & Quarrying
Manufacturing
Electricity, Gas and Water Supply
Construction and Installation
Wholesale & Retail, Repair of MV, C,
Personal & HH goods
Hotels & Restaurants Services
Transport, Storage & Comm.
Financial Intermediation
Real Estate, Renting & Business
Activities
Public Administration & Defence
Education
Health & Social Work
Other Community, Soc & Per
Services
Priv. Households with Employed
Persons
Industry Not Specified
April
2015
July
October
January
Absolute
Change
Jan 15–Jan 14
207,100
6,900
71,700
8,000
81,500
210,200
5,800
77,300
9,500
76,200
206,400
5,300
70,300
8,700
83,300
207,700
6,600
72,300
7,800
82,700
199,700
6,100
78,900
8,500
76,200
-7,400
-800
7,200
500
-5,300
233,200
80,700
71,600
26,200
232,200
77,200
77,000
29,100
216,500
82,700
76,400
25,000
223,800
81,400
76,000
23,900
237,000
81,300
77,100
28,200
3,800
600
5,500
2,000
70,600
57,200
70,000
32,600
69,900
57,700
63,700
30,600
64,400
57,500
73,000
33,400
64,500
55,000
74,500
31,100
64,500
56,500
70,800
33,300
-6,100
-700
800
700
54,200
59,000
63,800
57,900
57,900
3,700
55,500
3,100
55,600
2,000
54,200
3,700
56,900
2,400
53,400
3,300
-2,100
200
22
Planning Institute of Jamaica
May 21, 2015
Labour Market Indicators
 Total employed labour force for January 2015
increased by 2 600 persons to 1 132 700 compared
with January 2014 and 8 200 persons compared
with October 2014.
 The unemployment rate for January 2015 was
14.2% compared with 13.4% in January 2014 and
14.2% in October 2014.
May 21, 2015
Planning Institute of Jamaica
23
Short-term Prospects & Developments
 Short-term prospects for the economy are
generally positive based on:
 Strengthening of the performance of most industries relative to the
similar quarter of 2014. Growth to be led by:
 Agriculture (Continued recovery from drought conditions & increased
production from Agro Parks)
 Construction
 Mining & Quarrying
 Hotels & Restaurants
 Improved confidence levels based on the anticipated conclusion of
another successful quarterly review by the IMF
 Continued implementation of strategic investment projects (Hotel
and Road Construction, etc.)
 Downside Risks
 Effect of fiscal consolidation on the implementation of major
projects
 Beginning of the Hurricane season
Planning Institute of Jamaica
May 21, 2015
24
Inflation
April 2015
 Inflation of 0.2 % was recorded for April 2015
and largely reflected higher prices for:
 Food & Non-Alcoholic Beverages, up 0.5% due to:
 Vegetables & Starchy Foods, up 0.8%
 Meat , up 0.4%
 Fish & Seafood, up 0.5%
 Transport, up 1.1%
Planning Institute of Jamaica
May 21, 2015
25
Tourism
April 2015
 Provisional data indicate:
 Airport arrivals increased by 4.9% in April 2015
 Cruise passenger arrivals decreased by 3.1%
May 21, 2015
Planning Institute of Jamaica
Planning Institute of Jamaica
May 21, 2015
26
26
Electricity April 2015
 Total electricity consumption decreased by
0.1% to 245.2 Million kilowatt hours.
Planning Institute of Jamaica
May 21, 2015
27
Mining & Quarrying
April 2015
 Total bauxite production grew by 0.1% due
to the net effect of :
 Alumina up 10.0%
 Crude Bauxite down 6.1%.
 Increase in Alumina exports of 21.0%, as
Crude Bauxite exports declined by 11.9%.
Planning Institute of Jamaica
May 21, 2015
28
Growth
April–June 2015
 Real GDP is projected to grow within the
range of 0.5% to 1.5% during April–June 2015
vis-à-vis April–June 2014.
May 21, 2015
Planning Institute of Jamaica
29