Montego Bay, Jamaica
Jamaica’s success in improving its ease of doing business and attracting foreign direct investment (FDI) has been based on its ability to significantly improve the approval process and it is now working on making it even quicker and easier for businesses wanting to place capital in the northern Caribbean island.
In an interview with the Business Guardian on the sidelines of the World Free Zones conference in Montego Bay Jamaica, Diane Edwards, president of the Jamaica Promotions Corporation (Jampro) said that investors want a smooth process and this is what her organisation tries to ensure.
Edwards said, “We have been able to accelerate the approvals process and we are doing a lot more work on creating a one-stop online shop to accelerate approvals even further, because what investors want is a smooth experience and that’s not what our bureaucracies have been trained to do. Our bureaucracies have been trained to be gate-keepers and not facilitators and we need to change that ethos into a facilitating ethos.”
While Edwards admitted that the taxation regime plays an important role she believes it is the quality of the services and the product on offer that makes a difference in both attracting and keeping FDI.
“Taxation plays some role, especially in special economic zones, yes they have played a strong role but that situation is evolving as well, so we have become more conscious of the quality of what we are offering to investors and not just fixate on the cost reduction, that’s why I was saying a while ago, come for the cost but stay for the quality,” Edwards explained.
Jampro is Jamaica’s trade and investment promotions corporation and is similar to InvesTT but with greater power. It was established as a statutory body under the Jampro Act, 1990, and promotes business opportunities in export and investment to Jamaica’s local and international private sector.
In addition to facilitating the implementation of investment and export projects, it acts as a key policy advocate and advisor to the Jamaica Government in matters pertaining to the improvements of Jamaica’s business environment.
Edwards was asked if in light of concerns about the need to ensure that businesses are in compliance with Environmental Sustainable and Corporate Governance goals and if adherence to these goals is a pre-requisite to investment in Jamaica, she said it is not explicitly so but is contained in many pieces of legislation.
Edwards said, “It is not exactly a pre-requisite explicitly stated, but those goals are embodied in a lot of the legislation that you have to comply with. So for instance, we have a building code, the building code has in it environmental impact studies, so you have to look at the impact on the environment. For instance, we have hotels that want to build in areas that are sensitive and we would require them to replant mangrove. I have one instance of that, or we would require them to protect the shoreline. So these things are embedded in legislation.”
She added, “So they may not be called explicitly SDG goals, but we are signatory to the goals and we are embedding them in all that we are doing, so for instance we also have a green investment strategy which is going to promote green investment, particularly renewable energy, particularly things like effluent, waste disposal, all of these things have to be done in an environmentally friendly way.”
Edwards was asked about the concern in Jamaica that many people leaving university are unable to find jobs outside of the Business Process Outsourcing sector like call centres, which do not pay a lot and leave them struggling to pay education loans, she insisted that there is a mismatch and that not enough university graduates see the opportunity in BPOs.
Edwards said, “Two things, one is that people coming out of universities often do not think of BPO as a career, and at the same time the BPO people are saying we can’t find management and leadership, so there is clearly a mismatch and we are trying to get the two talking more closely together because there is demand for different kind of skills. BPO is only one part of the spectrum, it goes up to software development. Right now we are training coders and software programmers and there will be jobs for them into the foreseeable future.”
On the issue of Free Zones and their reputation of poorly paying jobs, the Business Guardian also spoke Dr Samir Hamrouni the chief executive officer of the World Free Zones Organisation. He said the commitment was to ensure that the free zones of the future were not just about supplying much-needed jobs but high-quality jobs.
He said, “Within the free zone of the future there are two basic elements. A free zone should be the best place to do business in the country, so business excellence. So if within the country it takes three weeks to create a company, in the free zone it has to be one week. The second one is economic contribution. Year by year it is mandatory the zone should increase jobs created and export capacity.
Dr Hamrouni also defended free zones and the revenue that governments have to give up in return for having free zones saying studies show that countries receive a lot more than they give up by having free zones.
He said, “I will give you the last two studies we did. One in Costa Rica, from every dollar not collected, the country gets $6 and Dominican Republic $5 for every dollar given up in taxes and customs duties.”
For Edwards part of the sustainability in keeping Jamaica as a place to invest has to do with its movement to greater reliance on renewable and cleaner energy.
Edwards said, “We have what is called the integrated resource plan which was published in October 2021, and that is really looking at the ideal energy mix for Jamaica. So that includes solar, wind, waste to energy, hydro and of course LNG. So you really have to study it and to look at the mix of what is available, what is in the current state of technology because remember technology is evolving, so we have to look at baseload and variable load and how we can combine the two into an optimal mix. So I would say, could we go entirely solar? Probably not. But then you look at a country like Costa Rica which is 100 per cent renewable energy, so we have to find creative ways to bring the mix together.”