ECONOMIC GROWTH accelerated in the review quarter, relative to the first half of the calendar year, states the latest Bank of Jamaica quarterly monetary policy report.
This report states that this growth occurred in spite of the adverse impact of flood rains in the last week of September.
Growth was estimated in both the goods and services sectors. In the goods sector, growth was largely reflected in the construction sector and to a lesser extent, in the manufacturing sector.
The services sector grew appreciably due to continued expansion in the transport storage and communication sub-sector, and some recovery in tourism, the report states. Growth in economic activity reflected estimated increases in private and public sector consumption, as well as investments, which was partially offset by a deterioration in net external demand.
In the goods producing sector, growth was recorded in the manufacturing and construction sectors, while the agricultural and mining sectors experienced contractions.
The estimated contraction in agriculture reflected a reduction in domestic agriculture, which was partially offset by an expansion in export agriculture. The decline in domestic agriculture reflected the compounded impact of two tropical systems in September 2002, as well as the lagged effects of the rains in May 2002. Preliminary information from the Rural Agricultural Development Agency (RADA) indicated that approximately 2417 hectares of crops were damaged and approximately 12044 farmers were affected as a result of the flood rains during September. The crops that were most significantly affected were vegetables and ground provisions, with losses estimated at $286.4 million.
The marginal growth in export agriculture was largely reflective of the performance of the sugar industry. Due to the late reaping of the 2002 crop, the volume of sugar cane produced increased by 25.8 per cent in the quarter, relative to the September 2001 quarter. Banana cultivation on
the other hand was adversely affected by the weather conditions. In particular, it is estimated that small and medium sized producers lost approximately 20 per cent of their crops. Coffee exports were also reportedly affected by the September 2002 rains. Within the livestock sub-sector, preliminary estimates indicate losses of approximately $18.0 million, primarily from poultry.
Value added in the mining sector is estimated to have fallen in the September 2002 quarter, relative to the September 2001 quarter. This contraction was inferred from declines of 3.6 per cent and 1.5 per cent in crude bauxite and alumina production, respectively, relative to the September 2001 quarter. The rains hampered production in some of the plants, albeit for no more than one or two days.
The manufacturing sector is estimated to have grown marginally in the review quarter, relative to the corresponding quarter of the previous year.
This assessment is based on an estimated growth in the petroleum refining, food processing and the sugar, molasses and rum sub-sectors, the report states. How-ever, an estimated decline in the textile and wearing apparel and alcoholic and non-alcoholic industries partly offset the performance of the sector. Not-withstanding the overall growth in the food processing group, production in this industry was adversely affected by the September rains.
There was continued growth in the construction & installation sector in the September 2002 quarter.
