This is according to the Government of Jamaica 2021/22 Fiscal Policy Paper, which indicates that the economy declined by 14.6 per cent during the first half of fiscal year 2020/2l, from April to September 2020.
The document, which was tabled in the House of Representatives, indicates that the projected recovery is based on an anticipated decrease in the economic impact of the coronavirus (COVID-19) pandemic as global vaccination against the disease is executed.
It points out that, notwithstanding the existence of “notable risks”, the outlook is positive, with growth of 5.2 per cent projected for 2021/22, as the demand for goods and services increases over levels recorded in 2020/21.
This expansion is expected to be mainly driven by the hotels and restaurants; transport, storage and communications; and other services sectors, buoyed by anticipated increased tourist arrivals and a gradual return to normalcy, relative to the sharp decline in economic activity in 2020/21.
The Policy Paper states that medium-term growth within the goods-producing industry is expected to be spurred by agriculture, forestry and fishing, based on continued stabilisation of the supply chain associated with irrigation projects, such as the Essex Valley Irrigation Infrastructure Development Programme, and heightened demand resulting from increased tourism activity.
Mining and quarrying is also expected to contribute positively, due to anticipated increased production capacity, following the resumption of operations at the JISCO-Alpart refinery in 2022/23.
The Fiscal Policy Paper indicates that the projected positive out-turn in the services industry is expected to be significantly spurred by the hotels and restaurants sector being buoyed by anticipated increased visitor arrivals.
Inflation is expected to stabilise at around five per cent over the medium term, while the current account deficit is projected to increase, averaging 3.6 per cent of gross domestic product (GDP), over the period.
This, according to the Policy Paper, is primarily based on the expected deterioration in Jamaica’s trade balance as imports increase at a faster rate than exports.
- Countries: Jamaica
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