Five of the six service industry subsectors recorded positive out-turns to drive Jamaica’s estimated growth of six per cent for the January to March 2022 quarter.

Leading the way was ‘Hotels and Restaurants’, which, according to the Planning Institute of Jamaica (PIOJ), increased by an impressive 105.7 per cent.

This contributed significantly to the services industry recording an 8.9 per cent out-turn for the review period. 

Speaking during the PIOJ’s digital quarterly media briefing on Wednesday (June 1), PIOJ Director General Dr Wayne Henry said the hotels and restaurants subsector continues to benefit from increased travel, consequent on the relaxation of previously implemented COVID-19 containment measures.

“Preliminary data revealed that foreign national arrivals increased by 230.1 per cent to 475,805 visitors, and cruise-passenger arrivals [totalled] 99,798, relative to none in the corresponding quarter [last year]. Based on data received for January to February 2022, total visitor expenditure increased to US$485.6 million, relative to US$169.2 million in the corresponding period [in 2021],” Henry informed.

The other subsectors recording growth were ‘Wholesale and Retail Trade, Repair and Installation of Machinery’, up 9.5 per cent; ‘Transport, Storage and Communication’, up 8.1 per cent; Finance and Insurance Services, up 1.5 per cent; and Electricity and Water Supply, up 1.4 per cent.

Henry said, however, that the subsector ‘Producers of Government Services’ remained flat.

Meanwhile, only two of the four goods producing industry subsectors recorded positive out-turns.

These were ‘Agriculture, Forestry and Fishing’, which grew by an estimated 8.6 per cent, and ‘Construction’, up 1.1 per cent.

Henry said the agriculture sector’s performance reflected the impact of favourable weather conditions, an increase in hectares reaped, and increased demand associated with the further relaxation of the COVID-19 public health and social measures.

“Additionally, Government support through initiatives aimed at boosting production and productivity also contributed positively to output per hectare,” he added.

HIGHER CAPITAL EXPENDITURE ON CIVIL ENGINEERING ACTIVITIES

The director general also indicated that the construction subsector’s out-turn reflected growth in the ‘Other Construction’ and ‘Building Construction’ components.

“The growth in the ‘Building Construction’ component was driven by a 1.5 per cent increase in the value of mortgages disbursed by the National Housing Trust (NHT) to $8.1 billion. Real sales of construction inputs grew, with wholesale of construction materials, hardware and plumbing up 13.4 per cent, and retail sale of paint and glass, up 2.9 per cent,” he informed.

Henry told journalists that the increase in the ‘Other Construction’ component was due to higher capital expenditure on civil engineering activities.

These, he informed, were reflected in outflows by the Jamaica Public Service Company, up 20.9 per cent to $1.4 billion, and National Works Agency (NWA), which disbursed $6.6 billion, an increase of 133.1 per cent.

Henry said the NWA’s disbursement facilitated work on the Yallahs to Harbour View leg of the Southern Coastal Highway Improvement Project (SCHIP).

“National Road Operating and Constructing Company Limited (NROCC) [also] disbursed $444.8 million, up 61.3 per cent, to facilitate works on Part A of the SCHIP, that is, the May Pen in Clarendon to Williamsfield in Manchester component,” he further indicated.

Conversely, ‘Mining and Quarrying’ declined by 64.3 per cent and manufacturing by 0.7 per cent.

Henry informed that the contraction in mining and quarrying resulted from lower outputs for alumina and crude bauxite.

“Alumina production fell by 74.3 per cent, mainly as a result of no production at the Jamalco alumina plant, which closed in August 2021 due to a fire at the facility. Crude bauxite production declined by 2.9 per cent, resulting from lower demand,” he further advised.

UPTURN IN TOURISM AND ENTERTAINMENT ACTIVITIES

Meanwhile, Henry said the growth prospects for April to June 2022 are “generally positive”, with the out-turn projected to be within the two to four per cent range, based on a continuation of the recovery process.

“This projection is supported by the further relaxation of COVID-19 containment measures… as well as an increase in domestic demand spurred by higher levels of employment,” the director general added.

Henry said growth during this period is expected to be driven by the ‘Hotels and Restaurants’, ‘Other Services’, and ‘Transport, Storage and Communications’ subsectors, reflecting the upturn in tourism and entertainment activities.

CAUTIOUSLY OPTIMISTIC

He advised that preliminary data for April to June 2022 indicate some “positive movements”, which support this projection.

“Airport arrivals for April 2022 totalled 227,259 persons, an increase of 174.8 per cent, compared with April 2021. Electricity consumption for April 2022 grew by 4.1 per cent, relative to April 2021,” Henry indicated.

He added that, “despite several challenges that abound, we remain cautiously optimistic as we continue to closely monitor and assess these developments”.