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Country Highlights

Jamaica & its Economy: Impact of Tourism

The tourism sector has been a significant driver of economic growth in Jamaica, contributing to employment, GDP, and foreign exchange earnings. According to the Planning Institute of Jamaica (PIOJ), the tourism sector has grown by 36.0% over the past 30 years, outpacing the total economic growth of 10.0%. The industry has been among the country’s fastest-growing industries for several decades, directly employing 175,000 Jamaicans and generating indirect employment for another 354,000 individuals. It also drives various sectors, including 15.0% of construction, 10.0% of banking and finance, 20.0% of manufacturing, and 21.0% of utilities, agriculture, and fisheries. Additionally, tourism receipts account for about 53% of total exports, equivalent to approximately 20% of GDP, making it a vital source of foreign exchange earnings for the country.

The economic impact of tourism in Jamaica extends beyond direct employment and sectoral contributions. The industry has been a key driver of growth and development, requiring the development of other tourism-supporting infrastructure such as roads, ports, hospitals, and banks. This has been essential for providing access to high-quality services and creating a competitive tourism environment. The strengthening of the tourism sector has also led to the creation of a resilient corridor, which has been crucial for the industry’s recovery and the protection of the supply chain through local connections.

The COVID-19 pandemic has, however, placed a strain on the Caribbean’s economy, including Jamaica, due to travel restrictions and supply chain disruptions. The crisis has significantly affected the tourism sector, which accounts for 34% of total economic output and employment in Jamaica. The decline in tourism arrivals from key source markets, such as the United States, Canada, the United Kingdom, and other European countries, has had profound implications for the sector and the wider economy. The prolonged crisis could reduce output relative to pre-crisis levels, affecting the country’s overall economic performance.

The tourism sector has been a vital contributor to Jamaica’s economy, driving employment, GDP, and foreign exchange earnings. However, the COVID-19 pandemic has highlighted the sector’s vulnerability to external shocks, emphasizing the need for greater resilience and diversification in the country’s economic structure. As the country seeks to recover from the impact of the pandemic, it will be essential to strengthen the tourism sector and explore opportunities for greater linkages between tourism and other sectors, such as agriculture, to ensure a more sustainable and resilient economic future.

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Understand the macroeconomic situations that affect the global positioning of countries.

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Featured Reports

Understand the macroeconomic situations that affect the global positioning of countries.

Businesses can better understand how chatbots can advocate their vision.

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