PIOJ head says Ja not in recession amid two consecutive quarters of decline
Published:Wednesday | February 19, 2025 | 11:11 AM
Director General of the Planning Institute of Jamaica (PIOJ) Dr Wayne Henry says the country is not in a recession as the macroeconomy remains relatively strong amid two consecutive quarters of decline.
Speaking at the agency’s quarterly press conference on Wednesday, Henry reported that Jamaica recorded a 1.8 per cent decline for the October to December quarter in 2024, resulting in the island entering into two consecutive quarters of decline, which some equate to a recession.
“The estimated outcome for the quarter largely reflected the lingering effects of Hurricane Beryl from the previous quarter, coupled with the storm Raphael and other hydrological events during the review quarter,” said Henry.
He added that these shocks negatively impacted the performance of electricity, water supplies, agriculture, wholesale & retail trade, and manufacturing of equipment.
Overall, the goods-producing industries declined by 4.7 per cent, and the services industries decreased by 0.7 per cent.
Within those categories, the largest single declining sector was agriculture, down 12 per cent.
The economy declined by 3.5 per cent in the July to September quarter, according to the Statistical Institute of Jamaica.
The economy reported a growth of 0.1 per cent in the April to June quarter.
Two consecutive quarters of GDP decline is a widely-used definition of the economy entering into a decline or recession.
Other factors can also be utilised by economist to argue whether the economy has entered into a recession such as employment rates, income, and production levels.
However the PIOJ head argued that Jamaica was not in recession as the macroeconomy remains relatively strong with high job demand.
“It is the PIOJ’s assessment that the Jamaican economy, though facing a downturn in the economic output is not in a recession. There are challenges due to hydrological shocks reflected largely in the fallout of tourism, electricity, and water supplies, agriculture, and fisheries,” said Henry.
The PIOJ expects the economy to return to growth in the current January to March quarter.
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