Jamaica’s economy shrank more than previously estimated during the July to September quarter of 2024, according to updated data released on Tuesday. The Statistical Institute of Jamaica (Statin) reported a 3.5 percent contraction in GDP for the third quarter, a sharp revision from the earlier estimate of a 2.8 percent decline.
This marks the first negative growth in Jamaica’s economy since the 6.6 percent contraction in the January to March quarter of 2021, which capped a recession caused by the COVID-19 pandemic. That recession saw the economy contract for five consecutive quarters.
Since the pandemic-induced recession, Jamaica’s economy had experienced a recovery, expanding for 13 consecutive quarters. However, the growth rate had been slowing over the past five quarters before the third-quarter decline was recorded. When adjusted for inflation, the output in the third quarter of 2024 was lower than it was during the same period in 2019, prior to the pandemic’s impact.
The Statistical Institute of Jamaica (Statin) cited several factors contributing to the downturn, notably the passage of Hurricane Beryl in July 2024. The hurricane had a significant adverse effect on the economy, particularly in the Agriculture, Forestry & Fishing, and Mining & Quarrying sectors. Heavy rains and strong winds from the storm damaged mature crops, disrupted harvesting, delayed planting, and caused considerable damage to one of the country’s major alumina-producing plants. Statin highlighted these challenges as key contributors to the economic contraction.
The report also noted significant damage to the Jamaica Public Service Company (JPS) infrastructure, which led to delays in power restoration across several parishes. This disruption resulted in reduced electricity and water consumption, negatively impacting the performance of both the Electricity and Water Supply and Other Services industries. Additionally, the tourism sector experienced a 6.1 percent decline during the third quarter.
While the GDP report primarily provides a backward-looking snapshot of economic activity from July to September, it remains a crucial indicator of Jamaica’s economic health, particularly amid growing concerns of a potential recession. There are expectations that the economic contraction may have continued into the October to December quarter and could persist into the January to March 2025 quarter.
