Jamaica: Government says upgrading of seaports a major objective

News was prepared under the information support of Online Daily Newspaper on Hellenic and international Shipping "Hellenic Shipping News".

31 Oct 2011

THE Ministry of Transport and Works says the upgrading the island's infrastructure, in particular the seaports, has been one of the major objectives of the ministry.

This is being done in order to capitalise on the island's strategic geographical location in relation to other countries in the western hemisphere, says permanent secretary in the ministry, Dr Alwin Hales, in an interview with JIS News.
"The ministry is positioning Jamaica as a hub for port activities, especially when widening of the Panama Canal is completed in 2014, which will see significant growth in the amount of cargo handled by our ports and will in turn lead to significant revenue and employment increase," he added.
He said the expansion of the ports and upgrading of other infrastructure, ties in with the country's Vision 2030 national development plan.
Vision 2030 Jamaica is the country's first long-term national development plan, which aims at enabling Jamaica to achieve developed country status by 2030. It is based on a comprehensive vision: 'Jamaica, the place of choice to live, work, raise families and do business.'
The major ports of focus are the Kingston Container Terminal, Montego Bay, Ocho Rios, Falmouth and Port Antonio.
The permanent secretary said the Port Authority of Jamaica recently signed agreements with ship operators, which will see expansion in cruise shipping in Ocho Rios and Montego Bay, as well as further expansion at the Kingston Container Terminal.
"The entities involved include the Carnival Cruise Line and the CMA/CGM Group. We are not ready to put a cost on the Carnival activities just as yet, but it will involve significant private investment and they are still in the negotiation phase," he said.
"In terms of the container terminal in Kingston, it is expected that some $130 million will be spent on dredging and that will have to be completed in time for the 2014 opening of the widened Panama Canal. In addition to that, we are expecting an investment of some US$120 million from CMA/CGM in the expansion of the ports," he said.
Dr Hales pointed out that expansion works have led to increased capacity, particularly at the Kingston Container Terminal.
"In respect of the Kingston Container Terminal's capacity, we have seen where between 2004 and 2011, the revenue has more than doubled from $6 billion to just over $12 billion in income per year," he said, adding that it is Jamaica's primary transshipment facility and the Port Authority's main revenue earner.
"It is a major player in the regional transshipment market. The terminal has maintained its commanding position in the region through sustained efforts and marketing. We are positioning the port of Kingston to be the primary transshipment location in the region after the expansion of the Panama Canal is completed. It provides a convenient point for transshipment, logistic and container activities that will make for the efficient movement of goods throughout the region," he added.
Dr Hales informs that expansion works by the Port Authority have, over the years, resulted in capacity increasing from 400,000 twenty-foot equivalent units (TEUs) to the current 2.8 million TEUs.
"The first expansion was in 1995-1997 when it went from 400,000 to 800,000 TEUs, then in 1999-2001, it went to 1.2 million TEUs; in 2005 it was increased to 1.5 million TEUs, and between 2005 and 2008, it was increased to 2.8 million TEUs," he added.
Highlighting some of the benefits accrued to the country as a result of the expansion, Dr Hales told JIS News that one key element is employment.
"Many local jobs were created during the construction phase of these developments as well as personnel working within the Port Authority itself, and associated stakeholders who service the ports," he says.
"Business revenue to the Port Authority has increased with these phases of expansion. In addition to that, there have been benefits to the economy in terms of tax revenues, and other charges and fees associated with the shipping industry," the permanent secretary pointed out.
The expansions, he noted, have been funded through loan financing and internally generated funds. The most recent development in Falmouth, Trelawny -- he Falmouth Cruise Ship Pier -- was financed through a joint venture partnership between Royal Caribbean Cruise Line and the Port Authority.
He said that during 2010, calls to the ports were 3,635, some seven per cent higher than the previous year.
"The port of Kingston remains the main port of call, as there were 2,464 calls in 2010, some 273 more than the previous year. The port of Montego Bay received 330, while 219 vessels called at the port of Ocho Rios, and there were 622 calls at other ports," sais Dr Hales.
He pointed out that in 2009 during the global economic crisis there was a 9.8 per cent decline in activities at the ports. "During that time the Port Authority forged some partnerships and deals with the major shipping lines to ensure that they kept calling on our ports and to that extent, there have been some amount of recovery. We had growth of 9.47 per cent in 2010, which more or less virtually wiped out the shortfall in 2009," he said.
According to the permanent secretary, "things are looking really good for the transshipment and cruise business in Jamaica and we are really gearing up for the expansion of the port".
"The Port Authority is making every effort to attract investors in port expansion, because we are aware that the scale of expansion that is required is going to need a lot more than the country can absorb in terms of debt, so we are seeking investors of the highest calibre to partner with the Port Authority in the continued expansion of the island's ports," he said.
Source: Jamaica Observer