JIS News

The Government is seeking to create a new investment vehicle that is a model for select state-owned and private sector enterprises, to be packaged for offering to the general public.
This was announced today by Prime Minister P.J. Patterson during his Budget presentation in the House of Representatives.
The Prime Minister explained that the strong performance of the local stock market over the last few years had provided impetus for this approach and that the “abolition of double taxation of dividends has contributed positively to this performance”.
Mr. Patterson noted that criteria have been developed for the selection of enterprises, and these included profitability, positive cash flow generation, strong growth potential, and intrinsic value.
He said that from the government’s perspective, it was interested in a mechanism that would facilitate a partnership between itself and the private sector to raise financial resources (equity) for the development of the country. “This fresh capital can be utilised for reinvestment in existing companies and/or investment in new ventures, especially in those industries that have demonstrated growth and growth potential,” Mr. Patterson elaborated.
He added that government would also be looking at the opportunity to facilitate significant wealth creation for citizens. Over the last few years, the Prime Minister noted, the stock market has been a mechanism for significant wealth creation. “We want to broadening the base of ownership of companies through share ownership, which allowed wider participation by Jamaicans, both local and overseas,” he stressed.
Mr. Patterson noted that during the last fiscal year, significant alliances had been realized between the social partners. He also pointed out that investor confidence had been reflected in the country’s ability to access the international capital markets and the substantial agreements for direct foreign investment in critical growth industries.
“We are developing new and innovative ways to forge closer collaborative ties across all sectors,” he emphasized, pointing out that this was timely, in view of a “bullish” stock market; stable foreign exchange market; interest rates downward trending; and the willingness of the private sector to participate and contribute seed capital.

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