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FTC study to determine competitiveness in port services

Published:Sunday | March 4, 2018 | 12:00 AM
Containers are offloaded from a CMA CGM vessel at the port of Kingston on February 23, 2018.

The Fair Trading Commis-sion, FTC, is finalising a study of the port services industry in Jamaica to identify potential impediments to competition in light of Jamaica's development of special economic zones (SEZs).

The commission, which initiated the study last August, said the efficient operation of the industry was critical for the development of SEZs given that they are being touted as crucial to the competitiveness of the Jamaican economy.

Among the services offered by the port services industry are container handling, haulage, warehousing, and terminal operation, while regulatory oversight is provided primarily by the Port Authority of Jamaica.

The FTC said the aim of the study, the initial results of which are due this month, is to propose a framework for the port services industry that would be best to facilitate sustained growth in the wider local economy in light of the proposed policies to position Jamaica as a significant node in global logistics.


final report


The final report will be released following consultation with stakeholders, including regulatory bodies, ministries, and agencies as well as the Jamaica Special Economic Zone Authority.

Jamaica's SEZ structure is in its nascent phase. In September 2017, Prime Minister Andrew Holness tabled SEZ regulations in the House of Representatives, just over a year after the SEZ Act came into force on August 1, 2016. The zones are expected to open up significant economic opportunities for Jamaica in terms of employment, manufacturing, small-business development and foreign exchange earnings.

SEZs are designated geographical areas that operate under special regulations and tax structure. They were created to replace free zones, whose structure contravened international trade rules.

The SEZs now in operation include the Global Auto Logistics Centre launched by Kingston Wharves Limited in December 2017, providing a one-stop facility for the warehousing of cars for domestic distribution and for markets throughout the region; and Montego Bay Technology Park and Special Economic Zone, formerly Montego Bay Free Zone.

Within the SEZ law, there is a transitional mechanism in place designed to facilitate existing free zone companies, which will have a transitional period in which to regularise and transition to full SEZ status. Benefits to current free zone holders will automatically continue until the end of the transition period, December 31, 2019.

Competition Bureau Chief at the FTC, Dr Kevin Harriott, told the Financial Gleaner that as part of the study, they have interviewed key stakeholders but have decided not to discuss the preliminary findings until the commission is satisfied that it accurately captures stakeholders' views.

He said there are areas in the port sector in which "we think competition could be enhanced", and the FTC will make recommendations on how it could be restructured to make it more efficient.

Those recommendations will be incorporated in the report, the first draft of which is expected to be completed by the end of March, Harriott said.