MOST SECTORS of the Jamaican economy have declined as the country continues to reel from the effects of the global economic crisis, despite the fact that other countries have shown growth.

"This was reflected in weaker external demand for Jamaican goods and services, tighter financing conditions, a deterioration of the fiscal deficit and reduced remittance flows," said Dr Pauline Knight, acting director general of the Planning Institute of Jamaica (PIOJ).

Knight, who presented the information at the institution's quarterly press briefing Wednesday, said there were declines in mining and quarrying, manufacture, construction, transport, storage, communication and wholesale and retail trade.

There were declines in remittances from July to September 2009, which amounted to US$458.4 million, down 13.1 per cent when compared to the corresponding period in 2008.

Knight also revealed that, from July to September, real gross domestic product (GDP) declined by 3.1 per cent relative to the corresponding period last year.

$1.3 trillion fiscal deficit

Additionally, the country's fiscal deficit ballooned by $30.5 billion this quarter, which was $4.3 billion more than expected and $14.6 billion more than it did last year. The fiscal deficit now stands at a whopping $1.3 trillion.

Inflation for the quarter under review stood at 3.1 per cent, with inflationary pressures emanating primarily from increased prices in food and non-alcoholic beverages, housing, water, electricity, gas and other fuels.

Commenting on the short-term outlook, Knight said it was projected that the country would experience challenges from three broad areas. They include weakened external demand and its impact on export industries, namely, bauxite, alumina and manufacture; continued slowdown in construction activities, some of which are fuelled by a downturn in capital projects; and continued decline in remittances and consumer confidence, which wea-kened the demand for wholesale.

GDP decline

Additionally, she said it was forecasted that GDP would decline within the range of three per cent to four per cent during October to December.

She said the projection for the first quarter of the next calendar year was also negative.

"We anticipate that we will still continue to see some declines, especially in the first half of the year," she said, adding that the second quarter might show improvement.

However, despite the negatives, Knight said there was a possibility of increased levels of confidence, which would come from an agreement with the International Monetary Fund.