Jamaica not feeling effects of a recession, says PSOJ president

 

President of the Private Sector Organisation of Jamaica (PSOJ), Metry Seaga, says there seems to be a dichotomy between the data showing that the country is heading into a recession but not experiencing the effects of a recession. 

 

Mr. Seaga, who was a guest Thursday on the Morning Agenda on Power 106FM, said he is not disputing the data showing the economy has contracted, but he is unable to reconcile the difference between the decline in the Gross Domestic Product and the other economic variables. 

 

The PSOJ president said he is not seeing the usual rise in unemployment among other indicators that would accompany a recession. 

 

"Honestly, I'm not sure that we are feeling that in the country. When I look around and I see unemployment at 3.5%, the lowest it has ever been; when I see our dollar being stable; when I see some of the indicators; when I see the level of investment that's coming to us at the PSOJ; when I see the level of new companies coming in, I'm not sure how it is affecting business, to be honest with you. And I can't say that it is not," he admitted. 

 

Mr. Seaga added that the time has come to fix the country's anaemic economic growth and expand the local economy. 

 

"That is what we at the PSOJ are focused on. How do we grow the size of our economy? It's simply too small and we have got to increase its size by starting to export more. And we have got to do so through our special economic zones and getting investors here into the country to find a way to start to sell our goods and services and our value-added products to people in other countries. As far as I'm concerned, that's the key to unlocking our lack of growth over the last 50 years," he suggested. 

 

Opposition Spokesman on Finance Julian Robinson reiterated in Parliament on Thursday afternoon that Jamaica is heading into a recession based on the Planning Institute of Jamaica's projection that the country's GDP will record a second consecutive quarter of decline.

 

Mr. Robinson argued that the country has been on a decelerated path of growth ever since its recovery from the COVID-19 pandemic, with close to 55 per cent of Jamaicans now identifying as food insecure, meaning they cannot afford to eat properly. 

 

The PIOJ reported that the Jamaican economy contracted by 3.5 per cent for the July to September quarter of 2024. 

 

That followed a flat 0.2 per cent growth in the April to June quarter.

 

The figures for the economy's performance for the third quarter of 2024 are expected to be released later this month.

 

Speaking earlier Thursday on the Morning Agenda, Mr. Robinson argued that the government has contributed to the current economic downturn because it underspent its capital budget in the last two financial years - by $19 billion in the 2024/25 fiscal year and $9 billion the previous year. 

 

He believes the government could have spurred economic growth if it made greater use of the capital budget.