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Energy boost for productive sector using RE

THE EXPORT-IMPORT (EXIM) Bank has implemented a special credit line for manufacturers and agro-processors to establish alternative energy systems that would help to improve the overall efficiency of their production plants as well as to facilitate other investment opportunities.

The money may also be used to conduct an audit to assess current energy-usage efficiency and inform the way forward in determining the appropriate technology for individual operations.

At rates of 9.75 per cent on loans accessed in Jamaican dollars, and less than six per cent in US dollars, EXIM CEO Lisa Bell believes the time is right for local business to look seriously in this direction.

“Jamaica is uncompetitive because of energy in many of these manufacturing sectors,” Bell told a recent Gleaner Editors’ Forum on ‘Expanding Agricultural Trade: Opportunities and Threats’.

“Speaking from a financing standpoint, the Government has recognised that the cost of energy is an impediment. And so, through the DBJ (Development Bank of Jamaica) and EXIM, has put in place a line for manufacturers to provide financing for the establishment of alternative energy systems,” she disclosed.

Disincentive

Responding to the criticism that the 20-year payback period for utilising solar energy was a disincentive, Bell challenged private-sector interests to lobby for the Jamaica Public Service Company to engage them in net metering. This, she said, would allow businesses to supply excesselectricity to the national grid, as is done, to some extent, in the bauxite sector.

The banker also used the forum, held at the Mavis Bank Coffee Factory in St Andrew, to challenge the manufacturing sector to get up to speed and access the available funding to make them more globally competitive.

“Traditionally, when free-trade agreements are signed, there is usually development assistance provided alongside the weaker partner in developing the measures that will be needed to take full advantage of the agreement,” Bell disclosed.

“So there was one from the European Union when we did the EPA (Economic Partnership Agreement), and there will be another for CARIB-CAN (the Caribbean-Canada Trade Agreement). We need to ensure that we draw down on those funds and get them into the productive sector so that we can prepare for when the agreement opens up,” she added.

Financing a challenge

Bell said that three years had transpired without CARIFORUM and Jamaica drawing down on the developmental assistance that is available under the EPA.

She stated that although Jamaica is the farthest ahead of all the Caribbean territories, in terms of putting in place a financing agreement, this has not yet been ploughed into the productive sector.

Responding to complaints from some business people that the financing was not enough, she said: “There is help that has been made available. It may not be the complete amount that we need, but it can start the process, and the imperative is that we need to start because in a few years’ time, the window will close.”

Bell said her organisation has been doing everything possible to help business people who are serious about getting ahead.

“EXIM has been working assiduously to increase the amount of funding to be made available to the productive sector because we believe that with the reduction in interest rates, with us coming out of recession, there is a unique opportunity for development of the productive sector. We will have additional funding,” Bell said.



Category/ies:Jamaica News.
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