PIOJ Growth-Inducement Strategy - Planning Institute of Jamaica

4.0 Projected Performance
4.1 Calendar Year, 2011
Global Economy
The global economy is projected to grow by approximately 4.4 per cent in 2011.
Associated with this, credit markets, investment, output and trade are expected to
improve. Despite the monetary efforts to cool down the Chinese economy, growth will
be led by Emerging and Developing Countries, which combined, are projected to grow
by 6.4 per cent, almost three times the 2.2 per cent projected for the Developed world.
Against this background commodity prices are expected to continue to increase for 2011,
albeit at a slower pace than occurred during 2010. Demand will continue to be strong
from emerging market economies and expand in recovering developed countries.
Disruptions to supply and declining inventory levels are expected to contribute to the
upward trend in prices.
Domestic Economy
An expansion in real GDP of 1.9 per cent is projected for the Jamaican economy during
2011. This out-turn would represent the first calendar year increase since 2007 when the
economy grew by 1.4 per cent. This improved performance is predicated on
developments in both the international and domestic economy. The country is expected
to benefit from continued recovery in the global economy, specifically with Jamaica’s
main trading partners showing signs of improvement. World Output is projected to grow
by 4.4 per cent during 2011 with the USA, Jamaica’s main trading partner, expected to
expand by 2.7 per cent 27 . This should augur well for exports, primarily tourism,
bauxite/alumina as well as for increased remittance inflows. Domestically, aggregate
demand is expected to show signs of improvement during 2011, as business confidence
which had started to rise primarily during the latter part of 2010, is expected to continue
increasing during 2011. This is expected to translate into increased demand for goods
and services.
27 “World Economic Outlook”, IMF October 2010
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