JIS News

Prime Minister, the Hon. Bruce Golding, says that there is a need to wean the national budget off from its dependence on drawdowns from on the Capital Development Fund (CDF) to supplement expenditure.
Mr. Golding was responding to questions raised by Member of Parliament for East Central St. Andrew, Dr. Peter Phillips, on declining bauxite reserves at Tuesday’s (October 5) sitting of the House of Representatives at Gordon House.
The Prime Minister noted that, according to the Jamaica Bauxite Institute (JBI), the country still has had “comfortably” 30 years of new bauxite reserves left, with more being discovered. However, he acknowledged that “one day” it is going to be done, and the country needed to have something to show for it.
“Naturally, the concern now is to get the plants up and running, but we need to wean the budget off its reliance on the CDF for life support,” Mr. Golding said.
The CDF is funded by the levy on bauxite, and was established with a mandate to reinvest some of the revenues from the industry back into community and infrastructural upgrade of communities in the bauxite belt.
Mr. Golding advised the House that, in order to get the Ewarton Alumina Refinery in St. Catherine back into operation in July, the Government had to make significant concessions in its fiscal regime. He said he suspected that if it becamecomes possible to get the Alpart and/or Kirkvine (plants) back up, similar arrangements would have to be made.
“There are certain challenges that we have to overcome, but we have to look at the long term and we have to see how quickly we can get into a gear to ensure that this valuable asset has a lasting contribution to Jamaica,” he explained.
The Prime Minister also pointed out that while at the peak of the global recession, which severely impacted the bauxite/alumina industry, there were five million tonnes of aluminum stockpiled, up to last week, that inventory still stood at four million tonnes.
“Therefore, it seems to me that the opportunity for revival is still not at our door, because the inventories are still pretty high,” he asserted.
He further told the House that UC Rusal and Hydro Aluminum, joint owners of Alpart, were reviewing market conditions and start up costs before making a decision on reopening.
Mr. Golding said the feasibility study for the establishment of an aluminum refinery in Lydford, St. Ann, was suspended last year, because of the severe downturn in the global market. He said that recent advice from investment partners, China Minmetals Corporation and Century Aluminum Company, is was that they are were contemplating resumption of the study, but no decision has had been madee yet.

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