Durrant Pate/Contributor

The Jamaican economy continues to be in trouble, with the latest projection of another contraction for the current July- September quarter.

This would bring to four consecutive quarters of contraction, further worsening the current recession, with the economy recording an estimated contraction of 2.9% for the previous April to June quarter.

In delivering the current projection, the Planning Institute of Jamaica (PIOJ) says the economy is projected to contract within the range of 0.5% to 1.5% for July–September 2026. For PIOJ Director General, Dr Wayne Henry, “lower output is anticipated as industries continue to recover from the adverse effects of the hurricane. It is important to note, however, that as economic recovery intensifies, the expectation is that for each subsequent quarter, the rate of contraction will be progressively lower, ultimately returning to growth during October to December 2026. 

With regard to upside potential for growth, Dr Henry told the PIOJ’s Quarterly News Briefing earlier this week that the main supporting factors include: 

Risk factors in detail

1. Faster pace of recovery for most industries due to the gradual easing of the adverse impact of Hurricane Melissa 

2. Full operationalisation of the National Reconstruction and Resilience Authority (NaRRA) by the latter half of the fiscal year, which is expected to drive reconstruction efforts and further stimulate construction activity 

3. Timely resolution to the ongoing conflict in the Middle East, and 

4. Favourable weather conditions, to support the recovery in agricultural output and water production 

Risks to the short-term outlook include: 

1. Weather-related shocks, largely associated with the start of the hurricane season and the impact of the “Super El Nino” on vulnerable industries 

2. A worsening of geopolitical tensions, which may result in further inflationary pressures on energy and other commodity prices 

3. Delays in the execution of major infrastructure projects, which would constrain the economy’s medium-term growth potential. 

Latest data for July 2026

Preliminary data on the Mining & Quarrying industry for July 2026 indicate that alumina and crude bauxite production declined by 18.1% and 55.7%, respectively. With respect to the Accommodation and Food Service activities industry, preliminary data indicate that airport arrivals contracted by 22.4% relative to July 2025. However, Electricity consumption grew by 0.1% for July 2026.

For the first six months of 2026, real Gross Domestic Product (GDP) is estimated to have contracted by 3.5%. The Goods-Producing Industry declined by 6.8%, while the Services Industry declined by 2.4%. 

The industries that were estimated to have recorded the largest contractions during the first half of the year, were Mining & Quarrying, down 23.7%; Agriculture, Forestry & Fishing, down 17.6%; and Accommodation & Food Service Activities, down 14.4%.