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Press Release

Indices of Businesses & Consumers Show Relative Stability Even as Firms Anticipate increased Capital Expenditure

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The first quarter 2022 indices of business and consumers have shown little significant change over the preceding fourth quarter 2021 period, reflecting relative stability in economic expectations by both firms and individuals. This stability is deemed a positive development as the nation prepares to adjust to the initiatives to fully re-open the economy and emerge from the COVID-19 period. This overall perspective was a key outcome from today’s release of the quarterly indices by the Jamaica Chamber of Commerce’s Conference Board staged virtually in partnership with the National Commercial Bank Group, NCB Capital Markets and the Jamaica Stock Exchange. According to the main presenter Mr Don Anderson, Executive Chairman of Market Research Services Limited (MRSL), which has been carrying out the survey of businesses and consumers for some 20 years, on balance, consumers are optimistic that their individual economic prospects will improve as the economy opens up and as more job opportunities are created. At 157 points, the overall index remains below the pre-pandemic level of 170 points but is nonetheless 30% higher than the corresponding period in 2021. The data indicate that firms remain generally bullish in their optimism about the current climate for investment or expansion and profitability. This is indicated by the fact that the topline Index of Business Confidence moved from 115.2 points at the end of the first quarter of 2021 to 131.1 points at the end of the first quarter of 2022. It was noteworthy, Mr Anderson pointed out, that a number of sectors, anticipated significant increases in their capital expenditures over the short term. For instance, 64.3% of entities in Farming and Agriculture (including Mining and Quarry) projected increasing capital expenditure (up from 48.1% in 2020 and 57.6% in 2021). Similarly, in the industry grouping comprising Transport, Storage and Communications, 60% of firms projected increases compared with 23.8% in 2020 and 44.9% in 2021. Some 72.7% of firms in Construction and Installation were contemplating increased investment spend in 2022 and beyond, compared to 44.1% in 2020 and 52.5% in 2021.

It was a similar picture in Other Services (e.g., Personal Care etc.), where 75% of firms anticipated capital expenditure outlays up from 28.7% in 2020 and 47.3% in 2021, as well as in Finance, Insurance, Real Estate and Business Services where 2022 projections comprised 60%, compared to 38.3% and 38.5% respectively for 2020 and 2021. Both consumers and firms noted the specific concerns derived from the nation’s experience thus far with the COVID-19 pandemic. For individuals, the top issues were articulated as the need to get the economy “back on track”, as well the impact being caused by significant price increases. Businesses were similarly emphatic that getting the economy back on track should now be the primary focus for the government. The release event was chaired by the JCC Conference Board Chairman Andre Gooden and featured introductory remarks by Mr Vernon James (NCB/LYNK) and Ms Jamelia Jalaalwalikraam (NCB). Comments were also presented by a panel comprising businessman Mr Michael Ammar (Ammar & Azar Ltd) and economist Dr Wesley Hughes. The surveys of 117 businesses and 646 consumers used to generate the indices were executed between January and March 2022 across all Jamaica.