Master developer sought as partner for Caymanas SEZ project
The Ministry of Industry, Investment and Commerce is searching for a consultant to conduct a feasibility study on the Caymanas Special Economic Zone (CSEZ), at the same time that it has launched a search for a master developer for the 1,700-acre property.
The master developer, to be chosen through competitive bidding, will design, finance and operate the complex, said Dr Eric Deans, chairman of the ministry's Logistics Hub Task Force.
"The deal will be structured along the lines of a public-private partnership," he told the Financial Gleaner.
The Ministry of Industry has not yet determined how much financing is needed to develop the 1,700-acre site, saying that assessment would follow the design work and geo-technical studies.
Under Jamaica's logistics hub programme, the Government anticipates that about 16 special economic zones will be developed as trading and distribution hubs, one of which is the CSEZ.
The feasibility and design studies to be conducted by the consultant being recruited will relate only to Caymanas, which is a government-owned property.
"The developer is not conducting the feasibility, but is expected to reimburse the GOJ for the cost," Deans said.
He adds that for the other 15 economic zones, private investors will fund their own studies.
The Development Bank of Jamaica is handling the recruitment of the master developer and consultant for feasibility/design studies on behalf of the ministry.
World Bank backing
Jamaica is developing legislation for the new SEZ structure, with financing from the US$50m Foundations for Competitiveness and Growth Project, which is backed by the World Bank. Under this project, the World Bank is providing technical and legal expertise to help draft the law, said Deans.
So far, a SEZ Green Paper has been laid in the House of Parliament for public input. Once it moves to the next stage, a White Paper, the Ministry of Finance is expected to telegraph its position on tax incentives for SEZ investors.
Deans said the SEZ legislation is expected to be completed in the last quarter of this year.
As for the CSEZ feasibility study, he said the results are expected to guide Jamaica's negotiating position under the PPP deal with the master developer.
"The responsible way to privatise, and to ensure that this prime asset is developed to its best and optimum use, is to enter any negotiation process armed with relevant and current information to achieve results that are in the nation's best interest," said the ministry official.
The feasibility study, he said, will analyse factors that could create synergies or give rise to competition; test the resiliency of the project to natural disasters; determine the best use of the property and the phasing of the project.
It will include site assessment, a drainage study, infrastructure assessment, transportation assessment, market analysis, demand analysis, development of a concept master plan, financial analysis, and an implementation plan.
"This is an important project and it is essential that we get it right, and we are ensuring that we get it right with the help of our multilateral partners," Deans said.
The 2015-16 Budget includes a $30-million allocation for the CSEZ feasibility study and another $20 million for a draft logistics hub initiative master plan.