Jamaica must take advantage of FDI opportunities if it is to grow
Jamaica is poised to benefit significantly in the coming year if it takes advantage of growing trends and existing opportunities for foreign direct investments (FDI) said Phillip Gore, chairman of the Jamaica Promotions Corporation (JAMPRO). Gore said that Jamaica has managed to do well thus far, due to its relatively low labour cost, strategic location for export in relation to North America and its "economic infrastructure in key sectors, including tourism and information technology, which provide the platform for innovation by private enterprises in these sectors."
FDIs are a measure of foreign ownership of the local, productive assets of a country, including factories, land and organisations. Speaking at this year's final Mayberry Investment Forum on Wednesday, Gore said that there several opportunities that need to be observed and anticipated if they are to be capitalised on.
The widening of the Panama Canal in 2014 is certain to have some impact on the prospects of Jamaica, facilitating greater transhipment in the region and possibly greater FDI inflows. He mentioned the investments made in the Port Authority of Jamaica--the maritime agency responsible for the regulation and development of the port and shipping industry--which will spend $130 million on dredging operations. The Port Authority will also be expanded at a cost of US$120 million, in time for the opening of the Canal, an investment made by the CMA/CGM shipping line.
The viability of the tourism sector and its resilience, especially during the global recession, was a point of reference for Gore, who stated that there is much more than can be done by way of health and wellness tourism.
He commended the sector for its construction of an additional 10,000 rooms in recent times and the intent to create an additional 1,000 on the island's west coast, generating US$700 million in FDI inflows. He was referring to plans by Fiesta, the Spanish hotel chain, to open a luxury brand hotel in Hanover.
Tourism will be an even greater contributor to FDI inflows as several major projects will begin in the new year. Among these are the construction of a hotel by the Marriott chain, generating US$20 million in FDI and creating 200 jobs. Even more significant is the Harmony Cove project which is expected to be fully implemented by next year and generate FDI in excess of US$2 billion.
Other opportunities exist in the information and communication technology sector, which JAMPRO has made top priority for attracting investments. Currently, the industry comprises approximately 26 companies and employs almost 11, 000 people full-time. The sector can look forward to "the entry of large players into the market and significant steps towards the goal of at least doubling the number of employees in the sector in the next three to five years".
There's more to come though, Gore said.
"Look out for some other major projects in the manufacturing, mining and energy sectors such as the Cement Jamaica project that is projected to deliver some US$340 million in capital expenditure." Plans also exist to create a West Kingston Power Plant which will run on oil/diesel but can be adjusted to run on liquified natural gas. This will begin by March 2012 and generate US$127million, creating 155 jobs.
The establishment a board to lead the Jamaica International Financial Services Authority will see significant progress being made in the offshore financial services centre further increasing the island's FDI inflows. Emphasis on generating FDI inflows have increased as it has become a major economic driver of globalisation, last year contributing US$201 million to the Jamaican economy. This sum falls short of the record -- just under a billion and a half dollars -- investments of pre-crash 2008.
In facilitating investment, Gore said JAMPRO is focused on targeting and landing investments needed to assist the country's developmental transformation, and as such, it is committed to following up on leads which come its way. JAMPRO is the country's investment and export promotion agency, established to stimulate, facilitate, and promote the development of trade and industry.