Chinese development financing for Jamaica surpasses $100b
Jamaica got substantially more backing for development from the People's Republic of China than any other country or funding agency, with an estimated $103 billion of loans and grants from the Asian powerhouse spread across nearly a dozen projects.
The funds, approved over several years, does not include the cost of the North-South Highway, according to the Planning Institute of Jamaica (PIOJ). That project ended up costing US$720 million.
Notably, as a possible show of influence, China, the world's second largest economy, offered grants or handouts equal to the US$15.9 million, committed directly in 2015 alone by the United States, the world's largest economy.
Most of the loans from China were for development and infrastructure upgrades, according to the newly released 2015 edition of the Economic and Social Survey Jamaica (ESSJ), published by the Planning Institute.
The ESSJ states that develop-ment assistance from China totalled US$880.4 million ($103.3 billion) for 11 projects, and that loan financing accounted for more than 90 per cent of that figure.
The PIOJ told Wednesday Business that the figures relate only to government-to-govern-ment financing programmes, which means they exclude public-private partnerships - like North-South developed by CHEC - and deal mainly with current projects.
The data compiled by the planning agency indicates a significant ramp-up of the Jamaica-China relationship.
In the last set of breakout data published by the Ministry of Finance showing monies owed to overseas entities, Jamaica was just $17 billion in debt to China at the end of fiscal 2013.
"PRC continued to focus its support primarily on the economic infrastructure sector, which was allocated US$690.5 million ($81 billion) of the resources provided, while the directly productive and social infrastructure sectors were allocated US$103 million ($12.1 billion) and US$86.9 million ($10.2 billion) respectively," the report said of current development programmes.
Compared to other large donors with ongoing projects, China easily surpasses them all.
The co-operation programme with the Inter-American Develop-ment Bank (IDB) totals US$591.9 million ($69.4 billion), comprising loan financing for the bulk of them, spread across 15 projects.
The World Bank's total financing of US$308.5 million ($36.2 billion) represents mainly loans spread over nine projects.
The European Union co-operation programme totals €242 million ($31.4 billion), most of which are grants spanning 16 programmes and projects.
The co-operation programme with the US, executed through the United States Agency for International Development (USAID), totals US$125 million ($14.7 billion) over five years and supports 18 grant projects.
The ESSJ outlook for 2016 listed more infrastructure projects coming on the books from China and elsewhere.
"Through the bilateral channel, it is anticipated that loan resources will be provided by the Federal Government of Belgium to construct a transportation hub in Portmore and by the People's Republic of China for the Southern Coastal Highway Improvement Project," the report said.
In December, the Jamaican Government signed a US$385 million contract with China Harbour Engineering Company Limited (CHEC) to build a 43 km roadway dubbed the Southern Coastal Highway Improvement Project. The road is the part of a 63 km network to link Kingston with Portland.
In 2015, China officially disbursed just under US$35 million to Jamaica, while the country repaid US$12.8 million in principal and some US$14.7 million in interest charges to the Asian giant.
Completed China-led projects include:
- Jamaica road-improvement and rehabilitation works - JDIP - for US$340 million ($39.9 billion) with counterpart financing of US$60 million ($7 billion) from Jamaica;
- The Jamaica Economical Housing Project totalling US$71.2 million ($8.4 billion) with counterpart funding of US$1 million ($117.3 million);
- The Palisadoes Shoreline Protection and Rehabilitation Works Project that constructed sea defences along the 14 km-long Palisadoes strip in the amount of US$58.1 million ($6.8 billion);
- The Chinese Garden Project in Jamaica for US$3 million ($351.9 million).
Other projects included a $5 billion debt for the construction of the Montego Bay Convention Centre and just over $3 billion for the construction of the Trelawny Multi-purpose Stadium.