Implementation and Concession Agreements Signed for North/South Link of Highway 2000

The Government on June 21 signed implementation and concession agreements for work to begin on the North/South link of Highway 2000 with Jamaica North South Highway Company Ltd. (JNSHC), a special purpose company established by China Harbour Engineering and Construction Company (CHEC), to undertake the development.

The signing took place at the offices of the Ministry of Transport and Works,  with Minister, Dr. the Hon. Omar Davies; Minister of Finance and Planning, Dr. the Hon. Peter Phillips, and Senior Vice President, China Communications, Mr. Chen Zhong, participating.  

Under the concession agreement, the Government will make no financial investment in the project, neither will it provide any loan guarantees, revenue guarantees or traffic guarantees for the project. It will, however, provide the JNSHC with similar incentives provided to Transjamaican Highway, operators of the existing highway.

The JNSHC will be responsible for financing, design, constructing and operating the project and will be given a concession period of 50 years. On completion of this concession, the roadway will be handed back to the Government  at no cost. The project, which is estimated to cost US$600 million, is expected to be financed by loans from China Development Bank and from equity provided by CHEC and should be constructed over three years.

Dr. Davies described the project as “a significant investment in infrastructure in Jamaica."  He expressed excitement at the possible additional development which will result, when this leg of Highway 2000 is completed.  “We feel that (it represents an) opportunity for us as a country to open up additional economic opportunities in terms of jobs and increased economic growth,” the Minister said.

A special feature of the project is that lands adjacent to the highway, totalling approximately five square kilometres, will be used for housing or commercial and hotel developments.

Addressing the concerns of  environmentalists, the Minister said that,  “we will not cut any corners except for the physical road corners. All regulatory requirements will be met by the investors and developers."

Meanwhile, Dr. Phillips explained the long concessionary period. “The Government is not making any financial commitments at all, so it was considered necessary to facilitate the sole investor, developer, risk taker, sufficient time to recoup that investment with an appropriate rate of return,” he explained.

Chairman of  the National Road Operating and Constructing Company (NROCC), Dr. Wayne Reid, explained that negotiations for the implementation of this project began over three years ago, and to date, a number of agreements have been signed  between CHEC and NROOCC. These included an MoU, a Framework Agreement and an Implementation contract.

The project will be a four-lane highway, similar to the existing one with all grade separated interchanges. The full Geotechnical risks are to be taken by the contractor.

Also included in the contract is the fact that the developer will be responsible for completing the Mt.  Rosser project and NROCC will be refunded the approximately US$120 million based on its expenditure to date.

The North South Link is proposed to begin at Caymanas and continue to Ocho Rios. It is expected to bypass the problematic areas of the Bog Walk Gorge, Mt. Rosser and Fern gully.

By Andrea Braham