Pipeline of projects to take growth to 3 per cent revealed
Director General of the Planning Institute of Jamaica, Dr Wayne Henry said some of the initiatives are slated to get underway by year’s end.
Director General of the Planning Institute of Jamaica (PIOJ), Dr Wayne Henry, on Wednesday revealed that there are a number of initiatives in the pipeline that will stimulate the economy in the medium to long-term when several projects that have fuelled the country’s recent growth rate of 1.8 per cent are expected to come to an end.
The new projects will emanate from investments in the Special Economic Zones (SEZs), the logistics hub initiative, the business processing outsourcing (BPO) sector, port infrastructure and the so-called blue economy.
Dr Henry who was speaking at the PIOJ’s quarterly media briefing at the Institute’s New Kingston office, said some of the initiatives are slated to get underway by year’s end.
“Increasingly, there have been questions as to the initiatives that are expected to drive growth during the medium term, based on projections for a strengthening in the growth out-turn within the range of 2.0-3.0 per cent,” Henry noted.
The PIOJ boss outlined that the logistics hub initiative will involve the development of 3,900 hectares of land across the island, with projected total capital expenditure of US$28.0 billion and the creation of approximately 100,000 jobs.
Henry disclosed that the Jamaican government was in the process of finalizing a bilateral agreement with the government of Singapore and Singapore Cooperation Enterprise to provide technical assistance during the implementation phase.
Meanwhile, eight SEZs are included among the major pipeline projects, with an estimated capital investment of US$8.9 billion, covering 6,000 hectares of land. Currently, the Freezones/SEZs include industries involved in the global BPO sector, distribution/warehousing, logistics services and manufacturing/assembly.
“Going forward, activities within the Freezones/SEZ will be augmented by emerging areas that include industries/activities such as, ship repair, aviation, automobile, electronics, clean energy, limestone, the creative industry, among others,” Henry stated.
With respect to timelines, by the end of 2019, it is expected that a total of 106 companies currently operating in the free zone would have transitioned to the SEZ.
Under the SEZ, existing companies would no longer be entitled to a zero-tax regime but instead will be required to pay Corporate Income Tax (CIT) of 12.5 per cent.
“This is expected to generate additional revenue to support growth,” said Henry.
By 2020, there will be the start-up of at least three of the new SEs, namely, 876 Logistics Limited; Phase 1 of the JISCO SEZ & Industrial Park; and the Caymanas Special Economic zone (CSEZ) North.
The year 2021 will see the roll out of the Caymanas SEZ South and the Jamaica German Ship Repair, while in 2022 phase II of the JISCO SEZ & Industrial Park and the Amaterra SEZ will be undertaken.
As for port and other major infrastructure developments, the government is looking to position Port Royal in Kingston as a cruise port, using Sea-Walk technology for a floating cruise pier. This development will be undertaken over a three to four year period.
Over in Ocho Rios, St Ann, work will continue at Reynolds Pier for the port to be able to accommodate larger vessels and to improve the aesthetics of the port.
Meanwhile, in Portmore, St Catherine, an additional 157,000 square feet of a new purpose-built Knowledge Processing Outsourcing will be completed, creating some 4,000 jobs.
The government will also explore species diversification for export purposes, such as sea cucumbers which are in high demand by Asian countries for medicinal purposes and which Jamaica has in abundance as part of the ‘blue economy’.
The ‘blue economy’ encompasses the sustainable management and use of marine resources whilst simultaneously optimizing its economic and social benefits.