The Bank of Jamaica (BOJ) is projecting a partial rebound in the economic growth of about three percent, in the aftermath of the coronavirus (COVID-19) pandemic, commencing in the fiscal year 2021/22.
Governor, Richard Byles, said the Statistical Institute of Jamaica’s (STATIN) June 2020 quarter growth out-turn, showing an 18.4 percent contraction in domestic economic activity, was a “sobering” indication of the extent of the pandemic’s impact on the country.
Mr. Byles said the effect was also evident in employment, noting that STATIN’s labour market survey showed that approximately 12.6 percent of the labour force was unemployed as of July 2020, up from 7.8 percent the previous year.
The Governor said despite the fallout in economic activity due to COVID-19, the financial system has remained resilient throughout the pandemic.
He advised that the BOJ’s regular assessment of deposit-taking institutions’ (DTIs’) balance sheets indicate that they are “more than adequately” capitalised and in compliance with prudent liquidity standards.
At the same time, Mr. Byles added that “DTIs’ provisioning remains sufficient to withstand credit losses”.
In relation to Jamaica’s external accounts, Mr. Byles said notwithstanding the fallout in tourism flows, the BOJ expects that the current account deficit of the balance of payments will remain at sustainable levels of two to four percent of gross domestic product (GDP) over the next two years.
In this regard, Mr. Byles said Jamaica’s reserves remain “healthy”, with net international reserves at the end of October totalling approximately US$2.9 billion.