Jersey's economy shrank by five per cent last year and was worth less than at any point since the island's statistical unit started compiling records 13 years ago. The decline was largely driven by an 11 per cent decrease in the value of the island’s biggest sector in the economy – the finance industry.
However, that industry has been celebrating after being made eighth-best finance centre in the world providing wealth management and private banking services, and fifth in Europe after London, Zurich, Geneva and Frankfurt according to the latest Global Financial Services Index.
Figures released by the States Statistics Unit show that Jersey Gross Value Added (GVA) – the value of economic activity in the island – stood at £3.5 billion last year, the lowest in real terms – when discounting inflation – since the unit began compiling the figures in 1998.
Ministers, however, have stressed that the figures are already at least two months old and do not represent the current state of Jersey’s economy.
The figures show that although the island saw growth of five per cent in 2006 and 2007, the value of the economy began contracting with the onset of the recession in 2008. Between 2008 and 2010 the GVA declined by 13 per cent.
Much of the decrease has been caused by the decline in the value of the finance industry, which was itself caused by a decrease in interest rates, which have reduced the value of deposits.
The performance of the non-finance industries, including construction, agriculture and tourism, have remained flat, and last year, for the first time since records began, were jointly valued higher than the finance industry.
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