North Coast Highway Project to open new paths for economy, says IFC Loop Jamaica

Black Immigrant Daily News

A representative of the International Finance Corporation (IFC) has declared that the Government’s North Coast Highway Project will boost tourism and open new areas of the amaican economy.

The declaration came as the Government signalled that it is moving ahead with plans for the multi-billion dollar project by entering into a Financial Advisory Services Agreement (FASA) with the IFC on Thursday.

With the urgent need for an ease in severe traffic congestion on the north coast, the North Coast Highway Project is being seen as timely, though a date for its start is yet to be established.

The agreement with the IFC, the private sector arm of the World Bank, is for the development of the project.

The US$800 million agreement was signed by Minister of Finance and the Public Service, Dr Nigel Clarke, and IFC Managing Director, Makhtar Diop, in Washington, DC, United States.

The FASA details the permissions granted to an advisor by their client for the purpose of creating a legal consulting arrangement.

The agreement is further to the Memorandum of Understanding (MOU) that was signed between the Government and the IFC in April of this year in relation to the same project.

Martin Spicer, the IFC’s Regional Director for the Caribbean, Mexico, Colombia and Central America, said the project will “open new paths for Jamaica’s social and economic development,” according to a statement from the Finance and Public Service Ministry.

He elaborated that, “IFC has extensive expertise in public-private partnerships for large infrastructure projects, and we are confident that this project will be an important boost for tourism and open up new areas for economic development in Jamaica.”

For his part, Clarke explained the basis for engaging the IFC for the upcoming road development project.

“Last year we signalled that the Government would leverage the improvement in Jamaica’s macro-economy to utilise an improved modality for highway infrastructure procurement that is open, competitive and transparent.

“With enhanced fiscal credibility and entrenched stability, Jamaica is now in a position to put together a complex transaction of this nature with the realistic prospect of attracting large international firms to compete,” Clarke was quoted as saying in the statement from the ministry.

According to him, the Government is pleased to enter into the definitive agreement with the IFC, whereby they will advise on the structuring and execution of the transaction.

Under FASA, the IFC will provide a full-service advisory that assists the Government in all steps of project structuring and implementation to successful closure of the expansion, improvement and maintenance of the Mammee Bay to Salem (12.3km), Seacastles to Greenwood (6.8km), and Greenwood to Discovery Bay (40.7km) road segments.

“These services include detailed technical, legal, financial environmental and social studies, designing the bidding process, and implementing a competitive tender that results in a bankable project for investors that meets clear public-sector goals,” the ministry said.

In addition, working with the IFC may also allow the Government to access grant resources that can help finance the cost of this advisory service.

“The IFC has advised on several innovative and ‘first’ road PPP transactions, and since 2004, has closed over 140 PPP transactions in 55 countries, leading close to 34 billion dollars of private financing,” the finance ministry stated.

The signing of the agreement was done during the International Monetary Fund/World Bank Annual Meetings that was being held in Washington DC, United States.

Financial Secretary, Darlene Morrison; Director General, Planning Institute of Jamaica (PIOJ), Dr Wayne Henry, as well as other senior members from IFC, also attended the signing ceremony.

Clarke also used the meetings to meet with other multilateral partners on Jamaica’s economic programmes, as well as with international credit rating agencies and investment banks.

NewsAmericasNow.com