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HomeBusinessEconomyJamaica’s PPPs earn international recognition

Jamaica’s PPPs earn international recognition

By Douglas McIntosh

KINGSTON, Jamaica, (JIS) – Prime minister, Andrew Holness, says Jamaica has attained an enviable track record of executing large-scale public-private partnership (PPP) and privatisation transactions.

He says specific transactions have been recognised internationally, noting that “we have [among other things] won structuring awards.”

Among these engagements, Holness points out, are the East-West and North-South legs of the Highway 2000 toll roads, the Sangster International Airport (SIA) and Norman Manley International Airport (NMIA), Kingston Container Terminal (KCT), Wigton Wind Farm, and TransJamaican Highway Limited (TJH).

He was speaking during the Jamaica Stock Exchange’s (JSE) recent 17th semi-virtual Regional Investments and Capital Markets Conference at the Jamaica Pegasus Hotel in New Kingston.

Holness said the KCT transaction was recognised in 2017 by Infrastructure Journal and Project Finance Magazine/IJ Global as the Port Deal of the Year.

The facility is operated by Kingston Freeport Terminal Limited (KFTL), a subsidiary of global container shipping group, CMA CGM, under a 30-year concession arrangement with the government, which commenced in July 2016. The concessionaire has invested approximately US$330 million in the terminal since taking over operations.

Holness also advised that LatinFinance Magazine recognised the US$225M international bond raised for TJH with the Infrastructure Financing of the Year Award in 2020. The TransJamaican transaction raised J$14.1 billion, the largest sum generated from an initial public offering IPO on the Jamaica Stock Exchange (JSE) to date.

The prime minister informed that in 2021, Sangster International Airport copped the prestigious World Travel Award for the Caribbean’s Leading Airport for the 14th time and 13th consecutive year. The facility is operated by MBJ Airports Limited, a subsidiary of the partnership between Mexican entity, Grupo Aeroportuario del Pacífico, S.A.B. de C.V (GAP), and the Vantage Airport Group, headquartered in Canada, under a 30-year concession agreement.

Holness pointed out that “of note, as of 2019, Jamaica’s PPP was ranked fourth in Latin America and the Caribbean.” He advised that the government has established a programme of attractive opportunities for private sector investors to acquire non-core state assets and participate in creating and improving public infrastructure.

“We have structured the opportunities using a variety of mechanisms, including asset sales through listing on the Jamaica Stock Exchange and direct sales to strategic investors, development leases, and PPPs,” Holness further informed.

He noted that PPPs were previously often viewed by successive governments as a modality to solve public sector budget constraints or financing gaps.

“Our macro-fiscal position has fundamentally changed, and we now have the wherewithal to undertake significant capital investment within the public sector budget. However, PPPs remain our preferred modality for infrastructure development,” the prime minister pointed out.

He said the primary reason relates, not just to financing, but to also leverage private sector expertise to assess, price and manage certain types of risks.

“The government’s objectives for the programme also include widening the base of ownership and direct equity participation in the economy and stimulating the local capital markets which are key drivers of private sector-led economic growth,” Holness added.

The three-day JSE Conference was held from January 25 to 27 under the theme: ‘Positioning Capital for Growth: Facilitating, Mobilising and Expanding’.

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