Issues

When you turn on your television, listen to your radio, open your newspaper or visit your favour news website at the moment – you are bombarded by the latest footage of the financial melt down.

But it’s hoped Jersey will be in a good position to deal with whatever is thrown at it - with the publication of the latest economic figures in the form of the GVA and the GNI.

But what are GVA and GNI? Well GVA is quite simply the Gross Value Added and the GNI is the Gross National Income.

Car sharing can save a motorist money

Which is great but what does that actually mean? BBC Jersey spoke to the head of the States Statistic Unit, Duncan Gibaut to find out.

He explained that with "both of these things, what we're trying to do is measure the size of the Jersey Economy.

"How much economic activity was going on in Jersey for calendar 2007 and the gross value added allows us to do that.

"It measures all the activity in Jersey and also by sector - finance versus construction vs agriculture etc...

"The GNI, the Gross National Income allows us to measure the size of Jersey's economy with respect to other jurisdictions, other countries."

Duncan explained that they are relevant to the person on the street because of the way they're made up.

The GVA is created by adding together company profits with the money we earn. That shows that the government is earning more money which can then be reinvested into the services we use - such as the hospital, our roads and even schools.

Every penny counts!

In comparison the GNI is used to compare our Island with other places around the world - and can be used as an indication of quality of life.

So now we know what the terms actually mean – lets look at where Jersey stands and what the figures are for the island.

According to the Statistics unit, last year Jersey's total GVA was £4.1 billion (before inflation is taken into account) and Duncan Gibaut says that shows positive growth compared to previous years.

He told BBC Jersey that "what we're seeing is that the Jersey economy saw a real term growth of 7% in 2007 and that is actually the second consecutive year that we have seen such real term growth.

“7% was the real term growth reporting for this time last year for 2006 and we are seeing 7% real term growth for 2007 and that is best characterised as strong real term growth."

Another factor of growth and the economy is labour – the workforce. Duncan explained that population change isn't entirely behind the growth.

Locals praise the store for its welcome

He told us that “we look at the change in the work force over the last five years; the average change per year is about .7%, so slightly less than 1%.

“So what we’ve seen over the last five years is economic growth that is averaging about 2.3% and change in the workforce of about .7%.

“That change in the workforce can indeed be due to net inward migration, and is at some level, but particularly over the last two to three years we have been reporting at the statistics unit increases in manpower (i.e. increases in the labour force) particularly for the locally qualified.”

Part of this measurement excersize is to see how the island compares with other jurisdictions. The information compares Jersey’s GNI with that of the Isle of Man, the UK and our nearest and dearest Guernsey.

Obviously the UK has the highest GNI but if you break it down to the GNI per capita which is the GNI divided by the number of people living there - then we come out on top.

And we also compare favourably to Guernsey according to Duncan Gibaut. He explained that: “In Jersey we have seen a growth of 6% in 2007 for this GNI figure. Guernsey saw a change of about 2% or so and that has roughly been the level for about the last two years.

“GNI for Jersey grew by 6% in 2007 and about 7% in 2006. Guernsey GNI grew by about 1 – 2% in each of those years.

Nick serving a customer

“So Jersey has seen a stronger growth in GNI than Guernsey and Jersey’s GNI has been similar to that of the Isle of Man. They saw an increase of GNI of 7.5%, so a smidgen higher than the Jersey rate of 6% and 7%.”

Jersey's Chief Minister says the continued growth in the economy cannot last. It grew by seven per cent last year for the second year in a row.

That's partly due to population growth, but also due to more people already here joining the workforce.

Chief Minister, Senator Frank Walker, told the BBC Jersey Breakfast Show that the island had to wary about being complacent, especially with the current global situation.

Senator Walker said: “We have to say that I don’t think there is any question of us being able to continue with the success we have enjoyed over the last two years.

“What we’ve got to do now is up our game still further to make sure we protect what we’ve got and make sure the people of Jersey, come what may, are protected against all the international effects that so many are suffering from.”

The Chief Minister also said that the island has hit its targets for economic growth over the last few years: “Actually what we’ve achieved over the last five years is 2.3% so we are marginally above target, but that has been built on a working force growth of 0.7% over the same period, which is below the States target of 1%.

“What that means is that we have made the workforce in Jersey more productive than ever before, and again that is one of the objectives we have been striving for.”

Savings

Despite turmoil in the global financial markets, Senator Walker believes that savings in Jersey bank accounts are safe.

He told BBC Jersey’s Breakfast Programme, Jersey Today, that the government will do all it can to make sure savers won't lose out.

He said: “No one has lost their deposit in Jersey, no one indeed has lost their deposit in the UK and that is a position we will do everything we possibly can to protect in the future, no matter what happens internationally.”

Senator Walker has said that meetings are taking place this week to make sure turmoil on the global financial markets won't affect savers here.

He explained that nobody would lose out: “we are going to do everything possible to protect the savings of Jersey depositors, and indeed our other depositors as well, but naturally protecting our local people is absolutely top of our agenda.”

Governments elsewhere have had to arrange rescue packages for banks and mortgage lenders affected by the credit crisis.

Senator Frank Walker says the government will do all it can to make sure savings are safe.

He explained that: “Our savings are very safe in Jersey because of the infrastructure that we have established and because of the banks we have allowed to set up here. We don’t have banks of a similar nature to Lehman for example.

“But we are well aware of concerns of ordinary people in Jersey with savings in the bank. Meetings have been taking place this week already and we are going to do everything possible to protect the savings of Jersey depositors.”