Jamaica remains a very viable destination for local and foreign investments, despite being ranked among the countries with the highest cost for energy in the Caribbean basin.
With a determination to attract those investments, Minister with responsibility for spurring investment growth in the country, Hon. Anthony Hylton, will be hosting an investment forum from March 1 to 2, at the Montego Bay Convention Centre, in St. James, to fuel the thrust.
Mr. Hylton, who is Minister of Industry, Investment and Commerce, tells JIS News that, “this is a forum with a difference."
Speaking at a JIS ‘Think Tank’ on February 21, the Minster pointed out that already, the forum has attracted more than 120 interests from every geographic zone across the world.
Spearheaded by Jamaica Promotions Limited (JAMPRO), a division of the Ministry, the forum aims to provide a unique opportunity for investors to “see, touch and feel” Jamaica as an investment destination, and will present a menu of potential projects across various sectors. It will focus on three main areas – Information Communication Technology (ICT), Manufacturing and Tourism.
The forum will also feature several knowledgeable local and international speakers, who are specialists in their field, to share ideas on the way forward.
The high energy cost in production has not been lost on the Minister, who points out that the Government will not shy away from the fact that this is a hurdle for investors. However, Mr. Hylton says the Government is committed to tackling this problem head-on.
"We have a time-table (to do this). We know that 380 Megawatts (MW) of new power is to come on board and the investment from the Jamaica Public Service Company (JPSCo) is there. We have to settle the Liquified Natural Gas (LNG) issue shortly, that is a priority. That is the time table,” he emphasises.
President of JAMPRO, Sancia Templer, in acknowledging the high cost of energy, tells JIS News that there are smart investors who do not focus on the initial hurdles, but rather see the overall economic benefits to be gained, and so whereas Jamaica’s energy cost may be high, there are other lucrative areas of competitive advantage.
"So, even though we have high energy costs, we are still able to attract investors. Clearly we have to be selective. There are some industries that are more sensitive to the cost of energy than others, but the investor would have to look at the overall package,” she says.
Manufacturing is the sector that is most affected by the high energy cost, and the President argues that investors involved in manufacturing, who wish to invest in Jamaica, could preferably be high value niche manufacturers.
“We would never be able to compete, for example, with the Far East. We could never be able to produce the kind of volumes at the kind of unit costs that come out of China, but we can do value-added culturally inspired products here in Jamaica, products that can proudly carry the Jamaican name,” she notes, citing the country’s world renowned spices and sauces.
Mrs. Templer tells JIS News that comparative studies have been done in the region, which revealed that the country is comparable in terms of the overall cost mix and in some instances, in terms of energy.
“So, whereas we would not seek to go into whole-scale mass manufacturing, there are advantages. There are products that can be manufactured competitively here, and there are other areas of investments that can be competitive in Jamaica, despite the high energy cost,” she says.
There have been proposals put on the table about turning to another cheaper energy source – coal. That, however, carries its own problems, notably the impact on the environment.
Minister Hylton says using coal as energy will rob the country of its important “green environment destination” label.
“I think what we need to do now is to be very focused on a particular fuel arrangement. We now have the LNG in sight, so we need to focus on that…and as we go forward, we’d look at what other mix of energy there is, taking into account the environment and the sustainability of our efforts,” the Minister explains.
“LNG represents the best solution and a lot of work has gone into it and we are at a point now where we are poised to make those decisions in coming to the quickest solution in so far as our energy price reduction is concerned,” he tells JIS News.
Meanwhile, the JAMPRO President says that the new JPSCo plant will help to bring the cost of energy down. “That augurs well for the future, but there are areas where we can be competitive today and we’re selectively working on those areas,” Mrs. Templer informs.
By O. Rodger Hutchinson, JIS PRO