Jamaica logistics hub dream step closer to reality

(Jamaica Observer) Jamaica’s long-anticipated logistics hub dream seems to be one step closer to becoming a reality.

Designated Free Zone administrator and operator Masada Jamaica Limited has entered a concessionary agreement with lubricant blender Gulfray America’s Manufacturing Limited for the development and management of the Spanish Town Free Zone to the tune of US$350 million.

The planned redevelopment and expansion of the eight-acre property to more than 42 acres is being done to accommodate new expressions of interest — one of which is for an assembly and distribution plant for the construction of motor vehicles, trucks, forklifts and buses by China National Automotive Industry Inter-national Corporation (CNAICO), a large state-owned group and a Fortune Global 500 enterprise.

Executive director of Masada Jamaica Limited, Robert Melamede at a press launch on Wednesday, told the audience that the first phase of the construction will be completed in June next year, after which nine international companies will occupy the zone.

What’s more, the planned expansion is expected to contribute 2,500 high-level jobs to the local economy in the areas of chemical and mechanical engineering, manufacturing, petro-chemicals, logistics and research.

“Additionally, jobs in the service industry will be generated by business processing outsourcing clients within the zone, as will jobs outsourced to small- and medium-sized enterprises,” Melamede stated. The project is expected to create 10,000 new jobs over the next two years.

CNAICO specialises in areas such as international trade, where it actively engages in global economic and technological cooperation. The company deals mainly with the import and export of vehicles, auto parts, agricultural and construction machinery, and other mechanical and electrical products with market presence in countries and regions all over Asia, Europe, Latin America and Africa.

Located at March Pen Road, St Catherine, the Spanish Town Free Zone is currently home to companies involved in the distribution of lubricating oil and greases, manufacturing and distribution of consumer products and product laboratory services.

Melamede stated that the expansion of the Spanish Town Free Zone will provide 1.5 million square feet of space in the first phase, representing the US$350-million investment. When completed, the facility will be used for the refining and regeneration of petroleum products, manufacturing of composite and insulation material, vehicle assembly, auto parts remanufacturing and distribution, manufacturing of pharmaceutical and nutraceutical products, research, development and manufacturing of tobacco products.

“We are able to maximise on Brand Jamaica, the logistics thrust of the island, its workforce and its strategic location in the heart of the Americas. We are able to secure these agreements with companies located in the United Arab Emirates, India, Dominican Republic, Singapore, USA and China just to name a few,” Melamede told the audience.

“In some instances, we have been able to successfully convince companies to relocate to our Economic Zone from other parts of the world… Let me be clear, the choice to create the Spanish Town Free Zone was not taken lightly.”

He added that availability of English-speaking skilled workers, central location and the increasingly welcoming business environment as reflected by the World Bank’s Ease of Doing Business Report was considered.

Spanish Town over Mariel

General Manager of CNAICO Liu Xiado told the audience that the company reconsidered opening operations at the Mariel Economic Zone in Cuba and instead chose the Spanish Town Free Zone.

Jamaica’s logistic hub initiative is one the pillars of the Jamaican Government’s economic growth strategy and is being spearheaded by the Ministry of Industry, Investment and Commerce in conjunction with a number of other Ministry’s, Departments and Agencies. The initiative focuses on the country becoming the Logistics Hub of the America’s and the fourth node in the global logistics network joining Dubai, Rotterdam and Singapore.

The country’s strategic location at the centre of the East-West and North-South trade routes, positions it play a significant role in international shipping and trade as a result of imminent expansion of the Panama Canal which is expected to double its capacity by the end of the year.

Chairman of the Logistics Hub Task Force, Eric Deans in explaining what is different about this project from other Government announcements that have gone unfulfilled, noted that “we have the occupants and tenants here with us roaring and ready to go. This is not a project which is due to start in two to three years, it’s an expansion of existing operations utilising the suppliers of GulFray and building on that synergies and that network. This is why you see all the range of investors represented here today.”