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Crime, high prices driving down confidence

The Jamaica Chamber of Commerce (JCC) is reporting that both business and consumer confidence fell during the fourth quarter of last year on the back of the galloping crime rate, as well as energy and food prices.

The Conference Board, an affiliate of the chamber, is reporting that the index of business confidence tumbled by 25 points to 109.8 points during the fourth quarter of last year, down from the 134 points recorded during the third quarter, and just a shade above the 110 points reached during the same period of the previous year.

The board is also reporting that the major factors behind this decline were concerns about the escalating acts of crime and violence, particularly murders, and galloping food and energy prices. The business community also expressed concerns about government’s macro economic policies, especially those related to greater levels tax compliance.

Slowdown
The chamber is also projecting that the economy will limp along by 1.75 per cent this year, based on the assumption that there will be no further weakening of the US and European Union (EU) economies, as well as declines in aggregate demand and remittance flows.

Meanwhile, the index of consumer confidence also dipped from 163 points during the third quarter of last year, to 147.7 during the fourth quarter. The survey also pointed out that the bulk of the decline was recorded in the future expectations index, which fell steeply by 19 points to 152.8 points, while the current economic conditions index dipped by 4.2 points to 132.4 points.
The decline in the expectations index was widespread across the island, while the dip in the future economic conditions was confined to the Kingston Metropolitan area.

Consumers, however, still expected the economy to continue on a growth path, albeit at a slower rate. They also expected more jobs to be created this year, and that income prospects remained favourable and spending plans mixed.

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