Dr. Wesley Hghes, Director General of the Planning Institute of Jamaica, adjusts his glasses as he briefs reporters on the economy Wednesday at the Planning Institute of Jamaica, New Kingston. - Rudolph Brown/Chief Photographer

Real economic movement for 2006 is expected to end up at 2.5 per cent, according to projections released on Wednesday by the Planning Institute of Jamaica (PIOJ), with services accounting for more than 80 per cent of the growth.

PIOJ estimated that real gross domestic product (GDP) during the July to September quarter grew by 2.7 per cent relative to the corresponding period in 2005, with the services sector growing by 3.7 per cent, while the real output of the goods producing sector moved upward by 0.4 per cent.

The state's planning agency also projected that the economy will grow by 3.2 per cent during the three months to December 3, which coupled with its estimate for the September quarter, and the Statistical Institute of Jamaica (Statin) measurements for the March and June quarters - 1.8 per cent and 2.4 per cent growth respectively - places overall growth for the 2006 calendar year at an annualised 2.5 per cent.

In its projection for the December quarter the PIOJ estimates that the goods producing sector will see 3.9 per cent real growth reflecting recovery from the comparative quarter the year before which experienced a slowdown as a result of a brewing cement crisis and squeeze on agricultural sector from heavy rains in October.

The planning agency also expects 2.7 per cent increase in real output from the services sector.

Last year, the real economy grew an estimated 1.9 per cent.

For the quarter under review, July to September, the PIOJ showed the construction sector was still reeling from the fallout from the shortage of cement in the first half of the year reflected in flat growth over the comparative period last year.

Agriculture led the growth in the goods producing sector with 9.6 per cent, driven by a 150 per cent increase in traditional export crop - coffee, banana and cocoa - production, while mining and quarrying grew marginally or by 0.9 per cent, representing an increase in crude bauxite production (16.1 per cent) against a one per cent decline in alumina production as a result of equipment failure at two refineries.

Services sector

Manufacturing continued to see decline (2.6 per cent) during the quarter, largely as a result of the Cigarette Company of Jamaica moving its manufacturing operation to Trinidad.

For the services sector, all sub-groups had increased outputs, with growth in hotels restaurants and clubs registering the highest growth 16.1 per cent which translated to one per cent growth in total GDP.

According to the PIOJ, the current quarter began on a strong positive note, with bauxite and alumina production in October registering 21 per cent growth over last October, a 2.4 per cent increase in electricity sales to 261 million kilowatt-hours, and with tourist arrivals during the month being 23 per cent higher than the comparative period last year.

- camilo.thame@gleanerjm.com