Logistics hub to be financed mainly by private sector
Richard Browne, Business Reporter
Given the level of investment required, the logistics hub development is expected to be financed mainly by private sector interests, according to Colin Bullock, director general of the Planning Institute of Jamaica.
There will be some support from international partners such as seed capital, he said, but in terms of financing “government is facing a major debt constraint” and so it has to be left to the private sector.
He was speaking at the Jamaica logistics hub symposium at the Jamaica Conference Centre, downtown Kingston on Tuesday.
The creation of the hub “would create employment opportunities at all levels of the value chain,” he said.
Also speaking at the symposium, Giorgio Valentini, World Bank representative for Jamaica, said that “compared to what I saw last year … there is already a change in the way people think” about the hub.
Valentini added that this could be the year that real change takes place. “This can be the year that we see some of those investments coming to fruition,” he said.
Dr. Juan Pedro Schmid, senior country economist at the Inter American Development Bank (IDB) is also cautiously optimistic about Jamaica, noting that it is coming out of a long and deep recession.
But he said the growth process will be “slow and tedious” because it is based on gradual improvements in confidence and relying on comparative advantages.
The logistics hub could act as a major driver for the economy providing revenues, employment, cheaper freight for Jamaican firms and other positives, Schmid said.
The IDB will play a role in developing the hub with the public sector, but more importantly the private sector, he added.
The IDB has various funding vehicles for small to larger businesses going up to as much as between US$10 million and US$200 million via the structured and corporate finance department for high development projects.
“We expect several business opportunities related to the logistics hub and look forward to providing our support,” he said.