Jamaica's Economy
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The case for a logistics hub - Commentary - Jamaica Gleaner - Sunday | April 6, 2014

The case for a logistics hub - Commentary - Jamaica Gleaner - Sunday | April 6, 2014 | Jamaica's Economy | Scoop.it

There are only three global logistics hubs established in the world: Dubai, Rotterdam, and Singapore. They have made significant contributions to the economy of these places, as can be seen from their high rate of employment and increasing revenue.The benefits that Jamaica can obtain from having a global logistics hub are not fully appreciated by many persons, and that is one of the reasons why there is not a greater support for establishing one.

EDP - Jamaica's insight:

There are only three global logistics hubs established in the world: Dubai, Rotterdam, and Singapore. They have made significant contributions to the economy of these places, as can be seen from their high rate of employment and increasing revenue. The benefits of a logistic hub are: new jobs, demand for services such as fuel, food, water, souvenirs and other items, increasing the supply of these items, and it will allow Jamaica to be this global center for assembling, finishing, packaging goods, and then exporting these items to other countries, profiting both the company and Jamaica.A logistics hub will not automatically generate revenue, but it will provide opportunities for persons to generate revenue for themselves, their children and for the country. If Jamaica is able to establish a global logistics hub, the number of persons living below the poverty line can be significantly reduced, for there will be increased employment at all levels, and greater wealth-creating opportunities.

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Jamaica strong investor in agricultural R&D - report - Jamaica Gleaner

Jamaica strong investor in agricultural R&D - report - Jamaica Gleaner | Jamaica's Economy | Scoop.it
Jamaica Gleaner
Jamaica strong investor in agricultural R&D - report
Jamaica Gleaner
Jamaica strong investor in agricultural R&D - report. Published: Friday | April 25, 2014 Comments 0. Richard Browne, Business Reporter.
EDP - Jamaica's insight:

Jamaica spends nearly one-third of their GDP on agricultural research and development. In a report by the Inter-American Development Bank, they  predict that the Latin American and Caribbean region (LAC) will be the next "bread baskets" of the world. Studies also show that there is strong correlation between agricultural development and increases in economic growth with poverty reductions. An added bonus in Jamaica is that investment in agriculture has higher returns than public spending or private investment. Although one-third of GDP is a large percentage to spend on R&D, Jamaica falls behind Uruguay, Argentina, Columbia, Honduras, and the Dominican Republic, which surprisingly spends sixty-percent of GDP on agricultural R&D. Many are optimistic, seeing that food production is increasing rapidly in these countries, considering that the population is growing exponentially, and the demand for food will too.     

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'Withdraw the tax' - Jamaica Observer

'Withdraw the tax' - Jamaica Observer | Jamaica's Economy | Scoop.it
Jamaica Gleaner 'Withdraw the tax' Jamaica Observer The release said that Phillips also reminded the trade unionists of the "precarious state to which the Jamaican economy had deteriorated, and the consensus that had been built around the demand...
EDP - Jamaica's insight:

Andrew Holness yesterday told the Government that its intention to introduce the new financial transactions tax was a point of departure between the Administration and the Opposition, and advised the prime minister to withdraw it. Holness said that the Opposition was concerned that the tax would open the door to other "brazen and thoughtless tax impositions under the guise of passing some IMF test.Dr Phillips apparently made the promise at yesterday's monthly meeting of the tripartite committee monitoring the three-year MOU between the Government and the trade unions representing unionized public sector staff.The MOU includes the current wage freeze and a $25,000 one-off payment to the workers in response to restrained inflation and job protection. But Holness told the House of Representatives that the country could not let adversity blind it to opportunity, neither should crisis and desperation cause it to forego creative solutions.

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Importers get $4.2b in waivers despite owing $1.2b in taxes - Lead Stories - Jamaica Gleaner - Tuesday | December 31, 2013

Importers get $4.2b in waivers despite owing $1.2b in taxes - Lead Stories - Jamaica Gleaner - Tuesday | December 31, 2013 | Jamaica's Economy | Scoop.it

Eleven importers who owed the Government some $1.2 billion in general consumption tax (GCT) and other taxes from 2011 were still able to get waivers valued at $4.2 billion in the last financial year.

EDP - Jamaica's insight:

Discretionary waivers have since been capped at $3.96 billion annually, and the power to approve them transferred from the minister of finance to tax department officials."We found that the process of approving waivers does not lend itself to detailed checks ... . We noted that the Revenue Protection Division conducts investigations after the waivers are approved," the government oversight agency noted. "The country does not stand to benefit as tax waivers represent potential revenue that the Government has given up. This, therefore, means that the Government of Jamaica is deprived of revenues both ways when importers who benefit from tax waivers are not paying taxes," the Auditor General's Department (AGD) observed. However, the AGD said the audit showed that 106 excavators, with a Cost Insurance and Freight (CIF) value of $1.2 billion, were imported at 100 per cent concession between 2011 and 2012, but "were not registered on any system to capture the stipulated conditions of the concession or restriction of transfer".

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Bank tax backlash! - Jamaica Gleaner

Bank tax backlash! - Jamaica Gleaner | Jamaica's Economy | Scoop.it
Jamaica Gleaner
Bank tax backlash!
Jamaica Gleaner
Finance Minister Dr Peter Phillips on his feet for the opening of the 2014-2015 Budget Debate. Finance Minister Dr Peter Phillips on his feet for the opening of the 2014-2015 Budget Debate.
EDP - Jamaica's insight:

The Government is coming under increasing fire over the announced new tax to be imposed on withdrawals from deposit-taking institutions, starting June 1. Finance Minister Dr Peter Phillips announced the new tax was expected to gain $2.25 billion this fiscal year, which would provide the bulk of the $6.7 billion in new taxes which the Government is budgeting to collect. The tax will be calculated on a graduated rate system, with withdrawals less than $1 million being subject to a 0.1 per cent tax (PCT). So, Jamaicans will pay $1 for every $1,000 they withdraw from deposit-taking institutions. Persons withdrawing >$20 million pay a 0.05 PCT, those withdrawing  >$5 million, but <$20 million, pay 0.075 PCT; and those taking $1 million - $5 million pay 0.09 PCT. 

"It is the stupidest tax to be levied on defenceless people in a long time. We are powerless. We can't do anything about it, because improved technologies have forced nearly all persons to use ATM cards to carry out transactions. What this means is that every time I do a transaction, it is a further erosion of disposable income," said Senator Kavan Gayle.

 
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'Jamaica in better place'... but this fiscal year 'won't be any less of a ... - Jamaica Gleaner

'Jamaica in better place'... but this fiscal year 'won't be any less of a ... - Jamaica Gleaner | Jamaica's Economy | Scoop.it
Jamaica Gleaner
'Jamaica in better place'... but this fiscal year 'won't be any less of a ...
Jamaica Gleaner
'Jamaica in better place'... but this fiscal year 'won't be any less of a fight', says Byles.
EDP - Jamaica's insight:

Jamaica had met the fourth-quarter primary surplus target and that he expects a positive International Monetary Fund (IMF) programme review for the end of March. A large challenge will be to achieve a primary balance target that is $10 billion higher than last year's and attaining meaningful economic growth. Previously, a general "lack of confidence" had been a major inhibitor to economic growth, but with the recent success of passing the IMF tests, that has been significantly eroded. So many Jamaicans have made sacrifices for this to happen. They include civil servants who have had a wage freeze, bond holders, and consumers who have had to deal with price increases due to the depreciation in the currency. The improvements came about despite a fall-off in taxes. "Tax revenues have consistently underperformed since August 2013, caused primarily by shortfalls from international trade taxes ($6.6 billion) as a result of lower imports; PAYE ($3.4 billion); tax on interest ($1.5 billion); and stamp duty ($1.5 billion)," said an EPOC news release.

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Bankers concerned over Gov't's new revenue measures - Jamaica Gleaner

Bankers concerned over Gov't's new revenue measures - Jamaica Gleaner | Jamaica's Economy | Scoop.it
Bankers concerned over Gov't's new revenue measures Jamaica Gleaner The Jamaica Bankers Association (JBA) has indicated it is concerned that the Government has not presented a more equitable and sustainable strategy to meet the shortfall in revenue...
EDP - Jamaica's insight:

The Jamaica Bankers Association (JBA) has expressed their concern at the measures the government has taken to make sure it makes its projected revenue for the 2014-2015 fiscal year. The JBA was specifically concerned about the new tax on withdrawals which it says, "conflicts with the country's aim to achieve financial inclusion." Also the JBA is worried about the asset-tax on financial institutions, on top of the already high corporate tax in Jamaica. The Government is very desperate and is trying hard to payoff its debt but some like the JBA think that the governments' taxes are too much.  

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Jamaica at final stage to implement FATCA - Jamaica Gleaner

Jamaica at final stage to implement FATCA - Jamaica Gleaner | Jamaica's Economy | Scoop.it
Jamaica Gleaner Jamaica at final stage to implement FATCA Jamaica Gleaner Next week, Jamaica and the United States (US) will officially sign the intergovernmental agreement (IGA) to implement the US' Foreign Account Tax Compliance Act (FATCA),...
EDP - Jamaica's insight:

The Jamaica Bankers Association (JBA) has indicated it is concerned that the Government has not presented a more equitable and sustainable strategy to meet the shortfall in revenue for the 2014-2015 fiscal year. In a release yesterday, the JBA said it was specifically concerned about the proposed levy of $2.25 billion by the Government on withdrawals from deposit-taking institutions and encashments from securities dealers. The JBA said it was also concerned with the Government's decision to raise an additional $1.79 billion, with an increase by 80% of the asset tax for deposit-taking entities regulated by the Bank of Jamaica. "The solution cannot be to impose repeated and increasing demands on the financial sector that is the most compliant and one of the largest contributors to tax revenues," the JBA said."As it stands, financial institutions are already subject to the higher rate of corporate income tax at 33.3%, compared to 25% for other companies. Financial institutions also suffer much higher rates of asset tax, compared with all other companies. These same financial institutions have already supported the Government's debt-reduction strategy through the Jamaica Debt Exchange and the National Debt Exchange."

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'Halt this madness of devaluation' - Shaw - Jamaica Gleaner

'Halt this madness of devaluation' - Shaw - Jamaica Gleaner | Jamaica's Economy | Scoop.it
Jamaica Gleaner 'Halt this madness of devaluation' - Shaw Jamaica Gleaner "The question is, if and when the exchange rate reaches J$120, what magic is that figure which would have made the Jamaican economy suddenly, if not miraculously, more...
EDP - Jamaica's insight:

Suggesting that the Government should consider fixing the exchange rate for a period of time, as a predecessor to a "managed floating system", Opposition spokesman on finance Audley Shaw has said a continuously devalued currency is a sure way to poverty. "This move, according to Shaw, should be pursued within the context of an International Monetary Fund (IMF) agreement in which the Government has passed three tests and a fourth likely to be passed, paving the way for US$2 billion in flows guaranteed from the multilaterals." The finance minister had blamed the nearly 11% devaluation last year primarily on a higher demand for foreign products purchased in USD. But Shaw insisted that the overused strategy of devaluation has "failed miserably to stimulate exports, contain growth in imports and to significantly reduce balance-of-payments deficits. Shaw is of the view that a stable currency is an essential prerequisite for businesses to succeed within that stable macroeconomic environment. Quoting a Gleaner article of April 16, the opposition spokesman charged that the IMF indicated that the Jamaican dollar was overvalued by between 8 and 22%, noting that the devaluation of 11% in the last fiscal year was "at the low end of the estimate". Meaning that further devaluation can be expected. 

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A resurrection for Jamaica? - Jamaica Observer

A resurrection for Jamaica? - Jamaica Observer | Jamaica's Economy | Scoop.it
A resurrection for Jamaica?
Jamaica Observer
We the honest residents of Jamaica are being asked to pay more to help cure others of their chronic electricity-theft habit.
EDP - Jamaica's insight:

"Jamaica has to find an additional $6.7 billion worth of taxes to close that ever-recurring gap in our $118-billion budget. To make matters worse, water is scarce, and electricity is threatening a 21% rate hike. 

Richard Byles, head of the Economic Programme Oversight Committee (EPOC), suggested that the conditionalities set down by the IMF may end up being "one of the best things to have ever happened to Jamaica". He believes that this is the tough love that will help us to become more disciplined and productive." Jamaicans think "it would help if our ministers, MPs and councillors acted like the servants of the people and not their masters." "It's pointed out that the sun provides 4,000 times the energy consumed globally" and that Jamaica has one of the highest levels of solar irradiation in the world, making them ideal for solar power. 

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Software company Medullan expands to Jamaica - Jamaica Gleaner

Software company Medullan expands to Jamaica - Jamaica Gleaner | Jamaica's Economy | Scoop.it
Jamaica Gleaner
Software company Medullan expands to Jamaica
Jamaica Gleaner
Software company Medullan expands to Jamaica. Published: Thursday | April 17, 2014 Comments 0. Avia Collinder, Business Reporter.
EDP - Jamaica's insight:

Last October, Massachusetts-based digital health care service company, Medullan, has moved operations to Jamaica. Some of Medullan's clients in the U.S. are Atena and Blue Cross Blue Shield Association. Medullan's purpose of moving to Jamaica was to "harness the local talent, who we find to be hard-working, disciplined, and entrepreneurial." Medullan's growth has been quite strong and it is expanding to different areas in the health care sector such as, pharmaceuticals, genomics, and potenially wearable devices. Moving to Jamaica has influenced Jamaica's economy by creating a, "significant investment in Jamaica's ICT/knowledge services industry that will create high-value jobs in software programming and testing".  

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