Logistics Centred Economy a Key Strategy – Minister Hylton

Minister of Industry, Investment and Commerce, Hon. Anthony Hylton, says developing a ‘logistics centred’ economy is a key strategy through which Jamaica’s global competitiveness can be significantly enhanced.

The Government envisages the country becoming the fourth node in the global logistics chain with the implementation of its Global Logistics Hub Initiative, which is geared towards achieving continued growth by bringing significant investments to the country.

Establishment of the hub will allow the country to take advantage of the anticipated increase in trade activities in the region as a result of the expansion of the Panama Canal, scheduled for completion by 2015.

“The Logistics Hub, as the centrepiece of the Government’s growth strategy, is expected to transform the Jamaican economy, create jobs and further integrate Jamaica into the global value chain. In so doing, Jamaica will become more deeply integrated into global value chains,” the Minister said.

He was speaking at the opening of a two-day Caribbean Competitiveness Forum, held at the Jamaica Pegasus Hotel in New Kingston, on Tuesday, March 18.

Mr. Hylton noted that the Logistics Hub will create the conditions for attracting global businesses, thereby facilitating and promoting the seamless access of Jamaican products and services to global markets.

“Several Special Economic Zones (SEZs) will be constructed across the island over time, and these will attract major transnational manufacturing and distribution companies, which will set up business in the zones, thereby creating additional employment for Jamaicans. The strategy to be used in the SEZs is the creation of industrial clusters, which involves the coming together of business entities within the zones,” he said.

The Minister noted that this strategy will greatly benefit the Micro, Small and Medium-size Enterprise (MSME) sector, which will be able to capitalize on the opportunities for linkages with larger global enterprises.

“This global integration will provide a well needed fillip to the Jamaican manufacturing and export sectors, and will result in the growth of the MSME sector,” he said, noting that the sector will play a pivotal role in Jamaica’s further integration into the global economy.

Mr. Hylton said the Government will ensure that it provides the most enabling legislative and policy framework, to facilitate the growth of MSMEs, the manufacturing and export sectors to take advantage of growth opportunities related to the logistics hub initiative.

In this regard, he noted that the Government has instituted or is in the process of instituting several positive legislative and policy changes, aimed at creating an enabling business environment.

These include the insolvency legislation, which will modernize bankruptcy laws, encourage entrepreneurship and facilitate rehabilitation of entities facing bankruptcy; the MSME and Entrepreneurship Policy, which provides a coherent framework for supporting MSMEs, facilitating increased access to financing  and capacity building, including conformity to global standards; and the Security Interests in Personal Property Act (SIPP), which increases access to financing, by allowing personal property (non real estate assets) to be used as collateral for  loans, to promote entrepreneurship and growth.

“All these are designed to support the Jamaican business environment as we move towards the creation of a logistics-centred economy, and elevate our position on the global value and supply chains.  In the process we have paid special attention to improving market access, capacity building programmes, and the attainment and adherence to global standards,” Mr. Hylton emphasized.

This is the second staging of the forum, organised by the Caribbean Centre for Competitiveness (CCfC) of the University of the West Indies, in collaboration with the Caribbean Export Development Agency (CEDA) and the Private Sector Organisation of Jamaica (PSOJ).

It is being held under the theme: ‘A New Innings: Competitiveness through Global Value Chains, Clustering and Innovation’, and focuses on four critical areas identified by most governments of the region as sectors with significant potential for growth. These are: Services; Caribbean Cuisine; Manufacturing; and Emerging Industries.

The forum will provide the opportunity for participants to share experiences and learn from regional success stories that will be showcased during the event. Participants will be exposed to the importance of clustering, value chain analysis and innovation to business development. They are also expected to gain insight into marketing, export and distribution strategies.