Economic decline hits Jamaica's ports
In addition, there has been a 15 per cent decline in domestic cargo moving through the ports since August. Chairman of the Port Authority of Jamaica, Noel Hylton, said plans to begin the expansion of the transshipment port in the Fort Augusta area of St Catherine in 2010 have been shelved, with the project now slated to begin a year later. The Port Authority has already purchased the lands, but with the cost of capital increasing, it has decided not to go to the market at this time to source the money.
A similar problem could delay the plan to build a world-class cruise-shipping pier in Falmouth, Trelawny.
The Port Authority will need to come up with US$122 million (J$9.5 billion) to finance the development of the marine side of the pier, but some international entities, which had initially indicated an interest in putting up the money, have backed off.
Cost of financing
"Last year, we met in Miami with about 12 or 14 international banks and at that time they all gave us an indication that they were ready to finance the project, but we were not ready because we had not completed negotiations with Royal (Caribbean).
"Unfortunately, when the negotiations were completed it was in the middle of the meltdown and so a number of those banks have indicated an unwillingness to look at those projects again," Hylton told a parliamentary committee yesterday.
"However, we have about eight banks which have indicated a willingness to offer financing," Hylton added.
He said proposals from these banks should be in before the end of this week and the Port Authority was still confident that it would source the money.
"The question of getting the financing is not the problem for us ... The problem is the cost of the financing and in today's world, financing costs can be very high," said Hylton.
Despite the woes, the European Investment Bank is reportedly looking at the project and if it decides to invest, interest rates could be reduced.
The Port Authority head also told the Public Administrations and Appropriations Committee of Parliament that there was no basis for the fears that the development of the Falmouth cruise-shipping pier could hurt the cruise-shipping industry in Ocho Rios and Montego Bay.
At least 80,000 passengers
He said while the Royal Caribbean cruise line could move its ships into Falmouth, an agreement is being worked out with another company, Carnival Cruise, to use Ocho Rios as its hub with no fewer than 80,000 passengers moving through Montego Bay.
"When you look at the distribution of the passengers, I believe Ocho Rios and Montego Bay will be better off than Falmouth," Hylton added.
A similar problem could delay the plan to build a world-class cruise-shipping pier in Falmouth, Trelawny.
The Port Authority will need to come up with US$122 million (J$9.5 billion) to finance the development of the marine side of the pier, but some international entities, which had initially indicated an interest in putting up the money, have backed off.
Cost of financing
"Last year, we met in Miami with about 12 or 14 international banks and at that time they all gave us an indication that they were ready to finance the project, but we were not ready because we had not completed negotiations with Royal (Caribbean).
"Unfortunately, when the negotiations were completed it was in the middle of the meltdown and so a number of those banks have indicated an unwillingness to look at those projects again," Hylton told a parliamentary committee yesterday.
"However, we have about eight banks which have indicated a willingness to offer financing," Hylton added.
He said proposals from these banks should be in before the end of this week and the Port Authority was still confident that it would source the money.
"The question of getting the financing is not the problem for us ... The problem is the cost of the financing and in today's world, financing costs can be very high," said Hylton.
Despite the woes, the European Investment Bank is reportedly looking at the project and if it decides to invest, interest rates could be reduced.
The Port Authority head also told the Public Administrations and Appropriations Committee of Parliament that there was no basis for the fears that the development of the Falmouth cruise-shipping pier could hurt the cruise-shipping industry in Ocho Rios and Montego Bay.
At least 80,000 passengers
He said while the Royal Caribbean cruise line could move its ships into Falmouth, an agreement is being worked out with another company, Carnival Cruise, to use Ocho Rios as its hub with no fewer than 80,000 passengers moving through Montego Bay.
"When you look at the distribution of the passengers, I believe Ocho Rios and Montego Bay will be better off than Falmouth," Hylton added.