Island’s economic recovery is predicted to be sooner and stronger than Jersey’s

GUERNSEY’S economy is predicted to bounce back faster and more strongly than Jersey’s.

(Picture: Shutterstock)
(Picture: Shutterstock)

Standard & Poor’s global ratings provides comparisons of how the two islands’ different approaches to handling Covid-19 will impact on the economy in the next few years.

Guernsey persisted with strict travel restrictions throughout last year, but within the island life continued unrestricted once lockdown ended in June.

Jersey, where tourism is a larger economic driver, was more open with its borders, but ended up battling a surge in cases in November, bringing in strict restrictions in December, closing non-essential businesses again.

Both islands provided different financial support measures.

GDP, a measure of the size of the economy, is predicted to have fallen in Guernsey by 8% in 2020, and by 7.7% in Jersey.

Both islands are expected to post strong recoveries next year as activity that was paused restarts and the wider economy gains momentum, S&P says.

Guernsey’s GDP is expected to grow by 4.8% in 2021, before slowing to 2.5% in 2022, and 2% in the following two years.

Jersey should increase by 3.2% this year, and then 1.9%, 1.1% and 1%.

GDP per capita provides comparisons which help eliminate the effects of the different population sizes.

Guernsey is consistently higher than Jersey and the gap is only set to widen.

In nominal terms, it rises from $62,800 in 2020 to $79,300 in 2024 in Guernsey, and from $55,200 to $65,100 over that time in Jersey.

Unemployment is historically higher in Jersey, although 2019 was an exception when the rate there was 2.4% and in Guernsey it was 2.7%.

Covid-19 hit Jersey’s figure harder, as it rose to 5.5% over 2020.

Guernsey peak was 3.1%.

It is expected to fall back to 1.8% next year here, staying static, while Jersey should fall to 4% in 2021 and 3.7% in 2022.

The data also indicates that government revenues held up better in Guernsey, as a % of GDP they remained fairly static between 2019 (24.5%) and 2020 (24.1%), whereas they fell in Jersey from 24.6% to 19.5% in that time.

Spending when measured against the size of the economy was slightly higher in Guernsey in 2020.

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