Feb 2017 Financial News

Agriculture tops real sector growth again (Jamaica)

Feb 22, 2017

Once again, the combination of agriculture, forestry and fishing was the sector which grew the most in the December 2016 quarter, the Bank of Jamaica (BOJ) indicates in its quarterly Monetary Report (QMPR) which was released yesterday.

The food and forest-based industries topped real sector growth, delivering an increase in the range of 17.5 to 18 per cent and contributing 52 per cent to growth in the goods sector.

Overall, the BOJ estimates that the Jamaican economy expanded within the range of 1.0 per cent to 2.0 per cent in the December 2016 quarter, representing the eighth consecutive quarter of growth. All industries are estimated to have grown, excluding manufacturing, mining and quarrying and producers of government services.

The goods sector under which agriculture is categorised contributed 63.4 per cent to this expansion in GDP, growing in the range of 2.5 to 3.5 per cent. The services sector, comprising the remainder, grew in the range of 0.5 per cent.

The pace of expansion in the tradable sectors of the economy was faster than that for the non-tradable sectors, reflecting continued positive performance in Agriculture, Forestry and Fishing and Hotels and Restaurants.

Non-tradable industries include Construction, Electricity, Gas & Water, Finance & Insurance Services, Real Estate, Renting& Business.

According to the BOJ, for the fourth consecutive quarter, agriculture, forest and fisheries recorded “robust growth, reflective of favourable weather conditions as well as various support initiatives by the Government and private interests.”

The December quarter saw an increase in output in domestic agriculture, traditional export crop production and animal farming, the central bank said, with the expansion in domestic agriculture primarily attributed to growth in vegetables and root crops.

Growth in traditional export crops reflected increases in coffee, cocoa and banana exports, while the increase in animal farming reflected growth in chicken and egg production.

No other sector is estimated to have grown above 2.5 per cent. The BOJ said Electricity & Water Supply, which grew in the range of 1.5 to 2.5 per cent, was mainly driven by the relatively low cost of energy. The growth in water production reflected increased rainfall relative to a year earlier, which was also higher than the 30-year average for that period.

Expansion in construction, which grew 0.5 per cent, the BOJ said, was mainly influenced by hotel construction and housing developments by the National Housing Trust (NHT), partly offset by a decline in road construction activities. The spike in NHT housing starts is predominantly related to the start-up of the Friendship housing development in St James, where 1,500 units are expected to be constructed.

Mining and Quarrying is estimated to have fallen between 4.5 to 5.5 per cent for the December 2016 quarter, reflecting contractions in both alumina and crude bauxite production.

The central bank said the declines largely reflected lower than anticipated capacity utilisation due to maintenance shutdowns and the change of management at one plant.

Source:
BY AVIA COLLINDER
collindera@jamaicaobserver.com
Business reporter
Jamaica Observer
Wednesday February 22, 2017   

http://www.jamaicaobserver.com/business/Agriculture-tops-real-sector-growth-again_90286