Manufacture underperforms as economy expands
McPherse Thompson, Assistant Business Editor
The mining and quarrying industry increased by 12 per cent during the December quarter, driven by higher production and global demand for bauxite and alumina, according to economic data released by the Planning Institute of Jamaica (PIOJ).
The planning agency also confirmed estimated economic growth of 1.4 per cent for the quarter to December 2013, reflecting what Director General Colin Bullock said was continued strengthening of economic performance by most industries.
For the calendar year 2013, real gross domestic product (GDP) was estimated to be relatively flat, recording an uptick of just 0.1 per cent, but better than the previous year when the economy contracted 0.5 per cent. This compares with a contraction of 0.5 per cent recorded in 2012.
The PIOJ predicts further expansion this March quarter of one to two per cent.
Bullock said performance during the December quarter was supported by relatively favourable but still challenging global economic conditions, as well as increased consumption, investment and industrial production.
"The impact of these developments on Jamaica was primarily manifested in higher demand for export of goods and services. However, lower commodity prices, primarily for metals and agricultural produce, dampened the growth in export earnings," Bullock told a briefing at the PIOJ's offices in New Kingston on Wednesday.
During the quarter, he said, alumina production grew by 15.5 per cent, reflecting increased production by Jamalco in Clarendon, up 7.6 per cent, and Windalco in Ewarton, St Catherine, up 38.8 per cent. Crude bauxite production increased by 2.9 per cent.
Agriculture, forestry and fishing grew by an estimated 10 per cent, assisted by improved weather conditions as well as increased output associated with the operations of agro parks.
Traditional export crops increased by 25.7 per cent, spurred by a 57 per cent increase in banana production, largely reflecting recovery from the impact of Hurricane Sandy, Bullock said.
The goods-producing sector expanded by four per cent, with all industries, except manufacture, registering improvement during the quarter.
Manufacture declined by an estimated 0.7 per cent because of contractions in foods, beverages and tobacco, with the food-processing component reflecting declines in the production of condensed milk, sugar and animal feed, the director general said.
Construction grew by two per cent, due largely to an expansion in residential developments.
The services industry grew by 0.6 per cent, reflecting increased real value-added in all industries except producers of government services, Bullock said.
Electricity consumption grew by 1.1 per cent due to increases in all business-related categories, but residential electricity consumption fell by 0.8 per cent.
Transport, storage and communication grew by one per cent. The increase in the transport component was spurred by a six per cent increase in air passenger movements largely reflecting increased stopover visitors, and a 1.4 per cent increase in the volume of maritime cargo handled at the island's seaports.
Expansion in telecommunications continued to be driven by the estimated increase in the volume of minutes sold due to a lowering of call rates and an intensification of competition among the major service providers.
Finance and insurance registered a 0.2 per cent growth, reflecting an increase in the total assets at deposit-taking institutions and an increase in fees and commissions income.
The stock of loans and advances outstanding at commercial banks amounted to $362 billion at the end of December 2013, an increase of 18 per cent compared with the end of December 2012. Of that amount, credit to the private sector accounted for about 92 per cent, Bullock said.
The wholesale and retail trade, repair and installation of machinery industry grew by 0.2 per cent, partly supported by an increase in volume and value of automated banking machines and point-of-sale transactions.
Real value-added for hotels and restaurants, which captures most of tourism activities, grew by 5.6 per cent. This was influenced by an estimated 7.2 per cent growth in stopover arrivals, Bullock said.