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Local manufacturing, as it is now, has no future - Hylton

Published:Wednesday | August 20, 2014 | 8:00 AM
Anthony Hylton

John Myers Jr, Gleaner Writer

Manufacturing has been one of the largest contributors to Jamaica's gross domestic product (GDP), but the industry minister says the sector, as currently exists, is incapable of driving the kind of growth that the country requires.

"Manufacturing, as we know it, which is simply to manufacture for local production, has no future," declared Minister of Industry, Investment and Commerce Anthony Hylton.

Hylton, who was addressing a Gleaner Editors' Forum on July 30, said local manufacturing "has to be linked into a global supply chain".

While acknowledging that a few local manufacturers have recognised this and have made steps to expand into regional and global markets, Hylton said more of them need to move in this direction.

Hylton said the creation of a logistics hub in Jamaica would provide an important fillip for local manufacturers, who would benefit from improved logistics and increased access to global markets.

SEIZE NEW OPPORTUNITIES

Supporting the industry minister, the logistics hub task force chairman, Dr Eric Deans, said the island's industries must explore and seize new opportunities in the global marketplace in order to generate the kind of demand that can drive local production at levels that can spur substantial economic growth.

"There are many more opportunities within the global environment, which, using our strategic assets or location, will allow us to access much larger markets than the Jamaican market. And it involves getting involved in a whole range of industries apart from what we have been traditionally used to," he said at the forum.

Manufacturing contributed 8.6 per cent to Jamaica's gross domestic product (GDP) in 2012, ahead of agriculture, with 6.6 per cent, and tourism at 5.4 per cent.

It also contributed J$30.5 billion taxes to the government coffers that same year, according to the Jamaica Manufacturers' Association (JMA). The sector contributed 8.4 per cent to GDP in 2013.

The JMA, in lobbying on behalf of its members, has consistently cited impediments such as the lack of incentives and other policies by the Government that inhibit expansion by manufacturers, as well as the high cost of energy, security, and other inputs.

"Despite experiencing significant challenges, manufacturers have demonstrated their resilience, and many continue to reinvest, innovate, and expand their reach in the local and international marketplace, which proves that opportunities exist that can and are being pursued by those who have the heart and dedication for hard work," the JMA has previously said.