Govt Provides Special Loan for Food Exporters to Upgrade Operations

KINGSTON — Government is offering food exporters a special loan of $100 million and  general assistance, to bring their operations up to standard to meet the new United States (US) Food and Drug Administration (FDA) requirements, which take effect in January, 2012.

Making the announcement at a press conference at the Ministry, in New Kingston, on September 6, Minister of Industry, Investment and Commerce, Hon. Dr. Christopher Tufton said the support  is critical, as firms that are not compliant with the new Food Safety Modernisation Act, which was outlined by United States President, Barack Obama, in January of this year, could be denied access to that market.

This, the Minister said, could result in serious fall-out for food exports, as the legislation holds significant implications for Jamaican exporters of food and other products to the US market. Affected entities include those that produce, handle, transport, import, export and distribute food to the US.

“New FDA regulations will affect all entities exporting food products to the US, whether in primary form or processed form,” Dr. Tufton stressed. Jamaica has an estimated 200 exporters, which comprise some 160 registered exporters of food products and more than 40 traders.

The FDA has advised that as of January, it will be conducting 50 audits among local firms and food facilities that export to the US, and these companies will be required to share their food safety plans with the FDA, upon request. Under the new Act, the Administration will have the power to restrict the importation of foods from facilities that refuse, or fail FDA inspections.

The law stipulates that firms write and implement new food safety protocols (Hazard Analysis Critical Control Points – HACCP), to protect against potential hazards. “They will also be required to implement acceptable traceability and recall procedures as well as strategies to prevent intentional contamination of foods,” the Minister noted.

Dr. Tufton said all local exporters must therefore not only ensure that they meet the requirements of the Act, but also the requirements of all other relevant FDA regulations governing the production and trading of food products.

In addition to the provision of the $100 million loan facility,  the Ministry is working closely with a number of stakeholders and entities to implement a programme to assist exporters in bringing their operations up to par. 

Stakeholders include: EXIM Bank, the Development Bank of Jamaica (DBJ), the Jamaica Exporters Association (JEA), the Ministry of Health, Veterinary Services Division, the Plant Quarantine Division, the Bureau of Standards Jamaica (BSJ), the Scientific Research Council (SRC), the Food Storage and Prevention of Infestation Division, and the Jamaica National Agency of Accreditation (JANAAC).

Dr. Tufton explained that the facility will aid exporters with the cost of becoming compliant, including consultancy, equipment and retooling. The interest rate on local currency loans is 6.5 to 7 per cent, while the interest on US equivalent loans is five to six per cent.

Additionally, the BSJ is developing a range of initiatives to support exporters. “This will include a programme where we will cost-share up to 25 per cent of the cost of assessing and providing the necessary technical assistance to those entities, in an attempt to fast-track their certification process,”  the Minister said.

The Bureau will also conduct “gap” audits to assess the state of readiness in respective companies, with the first meeting scheduled for September 9.  

Meanwhile, the Ministry will launch a mentorship programme involving exposure by companies that are not certified to companies that are certified, in order to gain practical exposure and informal advice on the process of certification.

“Already we have identified a few local companies that are certified and they have agreed to dialogue with colleague companies that are not, and to expose them to some of their own internal systems and processes,” Dr. Tufton said.

He also informed that an FDA expert is expected in the island in October to conduct sensitisation sessions on the new law, and its impact on food products that are to be exported to the US.

“So, we are in consultation with the US authorities and we are attempting, as best as possible, to get them involved in the process of explaining and helping us to appreciate the new requirements, in an attempt to build a relationship to overcome the challenges that we face,” the Minister said.
 

By Alphea Saunders, JIS Reporter