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Hurricane Beryl cost Jamaica $32 billion and sent the economy into decline, according to the Planning Institute of Jamaica.
The Jamaican economy contracted by 2.8 per cent in the July-September 2024 quarter, while the outlook for the December quarter remains cloudy. PIOJ said agriculture and mining bore the brunt of the damage.
The state agency projects that the economy may contract further by 1.5 per cent for the final quarter of 2024.
As the ongoing impact of Hurricane Beryl continues to reverberate across multiple sectors, the economy is anticipated to “contract for the remainder of this calendar and fiscal year,” said PIOJ Director General Dr Wayne Henry in his quarterly briefing on the economy on Wednesday.
The storm swiped Jamaica in early July, wreaking damage equivalent to 1.1 per cent of the $2.9-trillion economy.
Agriculture, mining, tourism, and infrastructure services experienced the greatest impact. “The cost of damage associated with the passage of Hurricane Beryl was estimated at $32.2 billion or 1.1 per cent of gross domestic product,” said Henry.
Encapsulated in the figure is $15.9 billion of damage to general infrastructure, $10.3 billion to transportation infrastructure, and $4.1 billion to the electricity grid.
“Looking ahead, all industries, with the exception of agriculture, construction, hotels and restaurants, and other services are expected to record growth in the short term. For agriculture, it is anticipated that the industry will return to a growth path in the new fiscal year in 2025/26,” said Henry.
Regarding the September quarter, the goods-producing industry, which includes agriculture, mining, and manufacturing, declined 6.5 per cent, with the agriculture sector experiencing the most severe impact.
“Thirteen of the fourteen parishes recorded a decline in domestic crop production, with agriculture contracting by 13.5 per cent,” Henry explained, while highlighting the widespread destruction caused by the hurricane.
In addition to the agricultural losses, the mining industry contracted 15 per cent, with alumina and bauxite production affected by damage to port infrastructure.
The damage to alumina producer Jamalco’s Rocky Point port “necessitated the diversion of alumina exports to an alternative port as well as tempered production,” said the PIOJ head.
The services industry also struggled during the quarter, contracting by 1.2 per cent. The most notable decline was in the hotels and restaurants sector, which faced a reduction in foreign visitor arrivals following travel advisories. The hotels and restaurants industry saw a decline of 2.1 per cent, largely due to a fall in visitor numbers and flight cancellations, Henry noted.
Despite these setbacks, some sectors demonstrated resilience. The finance and insurance services industry posted a modest 1.0 per cent growth, driven by higher revenue at banking institutions.
Over the nine-month horizon, January to September 2024, the planning agency estimated that the Jamaican economy shrank by 0.4 per cent.
The short-term economic outlook remains challenging, PIOJ noted. However, there are expectations for a recovery in specific sectors in 2025. Agriculture, for instance, should return to growth in the new fiscal year, once recovery efforts take hold, Henry said.
The PIOJ also addressed the wider implications of these economic difficulties, with a focus on the government’s long-term economic development strategy. As the country grapples with the challenges of natural disasters and global economic pressures, the PIOJ emphasised the importance of structural reforms and investment in key areas like human capital development and digital infrastructure.
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