WT/TPR/S/139/Rev.1 Trade Policy Review 
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IV. TRADE POLICIES BY SECTOR 
(1) OVERVIEW  
1. Since its previous Review in 1998, in parallel with its regional trade liberalization efforts, 
Jamaica has continued to use trade policies and incen tive schemes to promote specific sectors, within 
the overall framework established in the National Industrial Policy for 1996-2010 and the New Trade 
Policy presented in 2001 (Chapter II).  Over the years, incentives schemes have proliferated and 
resulted in a complex system that seems to reach numerous economic sectors.  It could be important 
to establish empirically whether the benefits of th e incentives system outweigh its costs, especially 
because the latter could be high and include forgon e fiscal revenue, reduced transparency, and the 
fostering of rent seeking and vested interest that make reform difficult. 
2. The agriculture sector has suffered from adver se weather conditions, and its share in GDP has 
been in a downward trend.  The sector is mainly or iented to domestic markets, with the exception of 
some traditional export crops such as sugar, bananas,  and coffee.  Because of its relative importance 
for employment and its role in poverty alleviation in  rural areas, the sector is considered sensitive and 
benefits from a range of support measures, incl uding aggregate import duties reaching up to 260% on 
certain vegetable products.  Some Jamaican farmer s may be affected by distortions in agricultural 
world markets, but others benefit from the windfall profits associated with preferential access to otherwise heavily protected third markets.  Re ductions in preferential margins could result in 
significant restructuring costs. 
3. Jamaica's mining sector is dominated by bauxite  and alumina production, which has become 
by far the largest non-service export activity.  The sector has benefited from rising world mineral 
prices in recent years and is internationally compe titive.  Changes have been introduced since 1998 to 
modernize the fiscal regime applied to these producer s, and further regulatory modifications are being 
considered. 
4. The contribution of the manufacturing sector to  GDP and employment has declined in recent 
years.  Manufacturing production is oriented mainly to supply domestic and regional markets 
although the textiles and clothing industry was a la rge exporter to the United States.  The modest 
performance of the sector as a whole is explained in good part by the sharp decline of the textiles and 
clothing industry, which appears to have been cau sed by factors high capital and operating costs, and 
competition from foreign producers with preferential access to the U.S. market.  Since its previous 
Review, Jamaica has used anti-dumping and safeguard measures for the first time to protect 
manufacturing activities. 
5. The electricity industry is mostly in the hands of one private operator.  In 1997, the multi-
sector regulatory agency, Office of Utilities Regulation assumed responsibility for regulating the sector.  In 2001, a new licence was issued to the incu mbent operator, giving it the exclusive right to 
transmit, distribute and supply electricity throughout  Jamaica for 20 years.  The incumbent was also 
granted the exclusive right to add generation capaci ty until 2004.  The authorities are reviewing the 
industry's outdated legal framework. 
6. In the services sector, the process of privatization and liberalization has continued during the 
period under review and market access conditions in most service activities are now considerably 
more liberal than those specified in Jamaica' s GATS Schedule.  In air transport services, the 
administration of one of Jamaica's two interna tional airports was given in concession in 2003 but 
certain restrictions remain on foreign ownership of dom estic airline companies.  In maritime transport, Jamaica WT/TPR/S/139/Rev.1 
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the authorities have sought more efficient delivery of port services through investment and 
management concessions to private enterprises. 
7. The performance of the financial services sector has improved since 1999.  Following the 
1996 financial crisis, the sector has consolidated through a series of mergers, and its regulatory 
framework has been strengthened with the esta blishment of the Financial Services Commission and 
increased monitoring and supervision by the Bank of Jamaica.  Although mergers have translated into 
a smaller but financially healthier,  number of banks, the domestic cost of capital continues to be high, 
with interest rate spreads at some  17 percentage points in early 2004. 
8. Tourism continues to be Jamaica's main earner of  foreign exchange.  The sector was affected 
by the 11 September 2001 terrorist attacks, but h as since recovered.  Incentive schemes, including 
relief from income tax and import duties, appear to be particularly important in the tourism sector. 
(2) AGRICULTURE AND RELATED INDUSTRIES  
(i) Main features 
9. The contribution of agriculture (together with fo restry and fishing) to GDP in 2002 at current 
prices was 6.4% and in real terms (in 1996 prices) 6. 1%.  In 2003, the contribution increased in real 
terms to 6.3% or to 13.8% if agri-processed goods ar e included;  this contribution has been declining 
slowly, from 7.3% in 1998 due to reduced output (C hart IV.1).  The reduction is attributed to 
unfavourable weather conditions, high interest rates on farm credit and the subsequent contraction of 
investment in the sector, and to the competition from agricultural imports.1  Agriculture is labour 
intensive and employed 19% of total labour force in 2002. 
10. The agriculture sector per se  is composed of four subsectors:  traditional export products;  
domestic crops;  livestock;  and food processing, beverages, and tobacco.  Traditional agricultural 
exports include sugar, bananas, cocoa, coconut s and coffee;  and domestic food crops include 
vegetables, fruits, yams, other tubers, potatoes,  and condiments.  Traditional export crops are 
produced mainly by large-scale farmers (accounting fo r less than 1% of all farmers and occupying 
about 39% of farm land) on the fertile coastal pl ains, while domestic crops are produced mainly by 
small-scale farmers (farms of 2.02 ha and less, a ccounting for around 77% of the farmers) in the 
rugged interior.2  The livestock subsector is composed mainly  of poultry, beef, and pork;  in 2002, it 
produced 110,156 tonnes of meat, of  which 83,839 tonnes by the poultr y industry.  Food processing is 
mostly in animal feeds, sugar, flour, poultry meat, and beverages. 
11. Since 1998, overall crop production has been falling.   Within traditional export crops, sugar 
and coffee production has shown no clear trend, while that of bananas and cocoa has been decreasing.  
In domestic crops, only vegeta ble production has shown an upward trend (Table IV.1). 
 
                                                      
1 FAO, "Jamaica".  Available  at:  http ://www.fao.org/DOCREP/005/Y4632E/y4632e0m.htm. 
2 FAO, "Jamaica". WT/TPR/S/139/Rev.1 Trade Policy Review 
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020406080100120140160180
1998 1999 2000 2001 2002Chart IV.1
Agriculture production (including fisheries) index, 1998-02
1986=100
Sourc e:  Planning Institute of Jamaica, Economic and Social Survey, Jamaica, 2002.Export crops Domestic crops Meat and poultry Fisheries Total
 
Table IV.1 
Estimates of crop production, 1998-03 
(Tonnes) 
Crops 1998 1999 2000 2001 2002 2003a
Production of selected traditional export crops: 
Sugar cane and derivatives    
- Cane milled 2,260,000 2,313,000 2, 025,000 2,231,000 1, 966,000 1,776,000
- Sugar production (commercial) 179,000 207,000 230,000 199,000 170,000 147,586
- Molasses 100,800 86,100 76,300 85,900 79,800 68,300
Bananas 62,338 52,208 42,026 43,052 39,386 39,936
Coffee 16,727 13,136 16,485 13,485 16,202 14,142
Cocoa   
- Deliveries to processing plants  4,167 2,549 1,836 2,325 1,918 1,834
- Outturn from processing plants  1,687 1,036 754 930 767 733
Coconut (in copra e quivalent weights)  19,662 20,113 21,042 17,211 15,493 15,283
Production of domestic food crops: 
Legumes 7,400 7,303 5,586 7,360 5,478 5,523
Vegetables 148,289 161,934 141,102 156,652 136,000 171,827
Condiments 29,037 34,425 30,606 33,530 22,007 26,173
Table IV.1 (cont'd)Jamaica WT/TPR/S/139/Rev.1 
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Crops 1998 1999 2000 2001 2002 2003a
Fruits 51,534 42,807 37,765 43,941 37,972 46,579
Cereals 2,228 2,165 1,781 2,083 1,755 2,043
Plantains 22,489 27,524 22,332 21,549 20,884 20,189
Potatoes 35,784 32,666 26,555 31,581 25,406 30,305
Yams 198,402 195,688 147,709 157,557 148,152 152,238
Other tubers 42,390 47,626 36,299 35,202 33,133 35,602
Sorrel 1,032 1,019 795 841 792 994
Total 538,585 553,157 450,530 490,296 431,579 491,473
 
a Preliminary. 
 
Source:  Ministry of Agriculture, "Agricultural Data", availa ble online at:  http://www.moa.gov.jm/AgriculturalData 
/data2003/production.htm;  and the Pl anning Institute of Jamaica (2002), Economic and Social Survey . 
12. Exports of traditional crops, mainly sugar, co ffee, and bananas, continue to dominate the 
sector in terms of foreign exchange earnings:  in 2002, these three products contributed 9.4% of total 
merchandise export earnings and represented close to  50% of all agricultural exports.  Exports of 
processed foods, beverages, and tobacco acc ounted for 13.8% of total exports of goods.3  Since 1998, 
the share of traditional agricultural export products  (unprocessed and processed) in total agricultural 
exports has remained stable;  how ever, the shares of sugar and bana nas have been falling while those 
of other products have been increasi ng (Chart IV.2).  According to the authorities, the decrease in the 
value of sugar exports can be explained by excha nge rate developments, a nd the reduction of banana 
exports by the inability of some farmers to meet stricter standards required by export markets as well 
as increased domestic demand.4 
13. The most important agricultural crop in Jamai ca in terms of employment and export earnings 
is sugar cane.   The sugar industry is the second largest single employer (employing around 
41,000 people during the cropping season and 28,000 the rest of the year) and the third largest earner 
of foreign exchange (after baux ite and tourism).  However, the industry is facing relatively high 
production costs and the current preferential arrangeme nts with the EU are set to end at the end of 
2007 (see also Chapter II(4)(i)).  Jamaica also im ports sugar;  in 2002, it imported US$42 million of 
sugar (and exported US$67 million).  Mo st of the sugar imported is refined sugar, for which there is a 
special import regime (see section (ii)(b) below). 
14. Most Jamaican sugar exports go to the EU under quota provided by the Sugar Protocol 
between the European Union and the ACP countries (80% of the 154,000 tonnes quota of raw sugar went to the United Kingdom), and the Special Prefer ential Sugar Agreement (renewed for six years in 
2000).  Jamaica also has access through a quota to the United States market (the minimum quota is of 11,500 tonnes).  However, during 2000-03, no sugar w as shipped to the United States, due to lack of 
demand in 2000-02, while in 2003 Jamaica did not produce sufficient sugar to meet its U.S. quota 
requirement.  In 2002, the certificate of quota elig ibility was exchanged for US$1,447,875, no money 
was received from the U.S. in 2003.  These quotas allo w Jamaica to sell its raw sugar above the world 
price:  in 2002, the price per tonne for sugar sold in the United Kingdom was £496.80, more than 
twice the world price (e.g. £206.70 per tonne).  Ther efore, Jamaica considers the maintenance of these 
preferential agreements essential for its economy. 
                                                     
 
3 Planning Institute of Jamaica (2002). 
4 The authorities note that the local market consumes  about 100,000 tonnes per year in the form of 
green fruit, ripe fruit, and for the processing of chips. WT/TPR/S/139/Rev.1 Trade Policy Review 
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Chart IV.2
Exports of agricultural products, 1998 and 2002
1998 2002
Total: $310.8 million
Source:   Planning Institute of Jamaica (2002) and (2003), Econ omic and Soci al Su rvey .Total: $289.8 millionSu gar
30.4%
Non-
traditional
41.3%
Rum
8.2%
Coffee
5.4 %Pime nto
1.3%Other 
t raditional
2.7% Bananas
10.7%Sugar
22.8%
Coffee
11.1%Ru m
11.9 %
Bananas
6.1%Pim ento
0.9%Other 
traditional
1.7%Non-traditional
45 .5%(Per cent)
 
15. Coffee is Jamaica's second most important si ngle agricultural crop in terms of exports 
(Japan being the principal market), followed by ba nanas.  The quota regime to the European Union 
for bananas is to be replaced in 2006 by a tari ff only regime.  Exports of bananas into the 
European Union is undertaken by the Banana Export Company Ltd (BECO) under a licence from 
the Banana Board running until 2010.   The cocoa industry has been benefiting from the high prices on 
the world market due to supply probl ems in Côte d'Ivoire.  However, according to the authorities, this 
has not yet been reflected in production statistics due to the time needed for the production to respond.  
The Government is rehabilitating the existing cocoa fiel ds and, in the longer run, plans to rehabilitate 
all major cocoa growing areas; it has been helping co coa farmers with fertilizers, rodenticides, cocoa 
seedlings, reaping hooks and technical advice under th e Cocoa Rehabilitation Project (Table IV.4).  
At the start of the 2003/04 crop year, a substantial increase in the farm-gat e price was granted to 
cocoa farmers;  the first payment (e.g. the payment made to farmers on the delivery of wet cocoa to 
the CIB) was increased from J$300.06 to J$450.06 per box of wet cocoa.  The coffee industry employs 25,000 people (with indirect employment  of about 150,000 persons), banana production 
around 6,000 people and, cocoa production 15,000. 
16. Jamaica is a net importer of agricultural produc ts, with imports almost two times higher than 
exports in 2002.  The main imported products that year were cereals and cereal preparations (18.4%) 
of total agricultural imports (including fisheries), ve getables (11.4%), dairy products (9.7%), and meat 
(8.5%).  Imports of cereals and vegetables have been increasing the most, passing from 4.0% and 1.7% in 1998 to18.4% and 11.4% in 2002, respectively.  In livestock, self-sufficiency ratios are high 
for beef and veal, and close to 100% for whole chickens. Jamaica WT/TPR/S/139/Rev.1 
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17. Jamaica has been involved as third party in  WTO dispute settlement concerning some 
agricultural products, such as bananas and sugar dispute (Chapter II(3)(i)). 
(ii) Policy objectives, instruments, and legal framework 
(a) Introduction 
18. The main agencies regulating and supporting the agricultural sector are the Ministry of 
Agriculture, its Plant Quarantine/Produce Inspection Unit and the Veterinary Services Division, and 
its statutory bodies and agencies, such as the Ru ral Agricultural Development Authority (RADA), 
the Jamaica Agricultural Society (JAS), Agri cultural Development Corporation (ADC), the 
Sugar Industry Authority (SIA), and commodity bo ards;  and the Jamaica Bureau of Standards 
(Chapter III(2)(xii) and (xiii)).  The legislation regulating the sector is described in Table IV.2. 
Table IV.2 
Legislation governing the agricultural sector, 2004 
Legislative act Latest 
amendment 
(year) Main provisions 
Banana Board Act, 1953 1985 Establishes th e Banana Board and defines its func tions and powers (i ncluding controlling 
and fixing prices to growers, producers or agents, and to regulate grading for exports) 
Banana Insurance Act, 
1946 1971 Provides for and regulates the insurance of banana growers, and establishes the Banana 
Insurance Fund 
Coconut Industry Control Act, 1945 2003 Establishes the Coconut Board and defines its  functions and powers, including the power 
to impose a cess on coconut products and s ubstitutes (manufactured or imported);  to 
provide for licensing of producers and exporters ;  to regulate the grades of coconuts and 
the minimum prices to be paid by copra makers  to coconut growers; to prescribe the price 
to be paid by the Board for copra purchased by them and the price to be charges by the 
Board for copra supplied by them to manufacturers of coconut products;  to regulate the 
grades and the wholesale prices of edible oils;  and to regulate the grades and the 
wholesale and retail prices of coconut products listed in the Act 
Coconut Industry Aid Act, 1969 2003 Provides the Coconut Board with power to grant import licences for coconut products or 
substitutes and impose a cess (manufactured or  imported);  grants the Minister of 
Agriculture power to prohibit exports and impose a specified duty on imports 
Coconut Insurance Act, 
1949 1987 Grants the Minister of Agriculture power  to regulate the institution, financing and 
operation by the Coconut Board of schemes fo r automatic and contractual insurance of 
coconut trees;  provides for establishment of  coconut insurance funds and power to impose 
a cess on coconuts and copra exported or sold for export 
Cocoa Industry Board Act, 
1957 1991 Establishes the Cocoa Board and defines its  functions and powers;  provides for the 
creation of a reserve fund to stabilise the prices  paid by the Board for cocoa;  and forbids 
the purchase or export of any cocoa by anybody  else but the Boards, a cocoa dealer or a 
person engaged in the manufacture of cocoa pr oducts, and for the power to prescribe the 
returns to be made 
Coffee Industry Regulation Act, 1948 1998 Establishes the Coffee Board and defines its functions and powers (including making 
regulations providing for the licensing of operators of coffee nurseries or coffee works or coffee dealers;  prohibiting, restricting or re gulating the purchase sale, distribution and the 
prices to be paid for coffee plants or seedli ngs;  prohibiting, restricting or regulating the 
growing, processing, storing, purchasing or se lling of any coffee berries or coffee product, 
as well as the export of any coffee or coffee pr oduct;  prescribing the grades and types and 
quality of coffee and its products;  prescribing the prices to be paid to growers, processors, 
manufacturers or dealers of coffee;  and impose a cess on the sale of any coffee or coffee 
product produced in Jamaica) 
Sugar Cane Farmers 
(Incorporation and Cess) 
Act, 1947 1969 Changes the status of the All-Island Jamaic a Cane Farmers Association and defines its 
powers and objectives, such as promoting the growing of cane, preparation of terms for 
cane farmers' contracts;  acting as agent for cane framers;  garnets the Minister of Agriculture with the power to impose upon all canes delivered to sugar manufacturers a 
specified cess 
Table IV.2 (cont'd) WT/TPR/S/139/Rev.1 Trade Policy Review 
Page 94 
 
 
Legislative act Latest 
amendment 
(year) Main provisions 
Sugar Industry Control 
Act, 1937 1994 Establishes the Sugar Industry Authority a nd defines its functions and powers (including 
the power to issue licences for the importation of raw sugar, issue licences in respect to 
quotas and to cane farmers, regi ster cane farmers);  subjects all imports of raw sugar to a 
licence to be obtained from the Authority; prohi bits exports of Muscovado Sugar;  grants 
the Minister of Agriculture the power to impos e a cess on all canes delivered to a factory, 
and to fix production and export quotas;  and provides for the appointme nt of a Sugar Cane 
Prices Committee 
Sugar (Reserve Funds) Act, 1947 1969 Establishes a Sugar Price Stabilization Fund,  a Sugar Industry Capital Rehabilitation Fund 
and a Sugar Industry Labour Welfare Fund, a nd Sugar Workers Pensions Fund;  provides 
for the payment by exporters a part of pro ceeds of sale of sugar to the Government 
Tobacco Industry 
Regulation Act, 1970 1975 Establishes the Tobacco Industry Control Au thority and defines its  functions and powers 
(including prohibiting, restric ting and regulating the purchase or sale of any tobacco, and 
prescribing the prices to be paid on the sale) 
Agricultural Credit Board 
Act, 1960 2004 Establishes the Agricultural Credit board a nd defines its functions;  it supervises and 
regulates agricultural loan societies 
Agricultural Development 
Corporation Act, 1963 .. .. 
Agricultural Loans Act, 
1887 1970 Regulates loans to any person in possession of  any land by any other person, company or 
body corporate 
Agricultural Marketing Act, 1944 1991 Provides the Minister of Agriculture with pow er to specify articles of agricultural produce 
and to make regulations for the registrati on of the producers of any specified article 
Agricultural Marketing 
Corporation Act, 1963 1978 Establishes the Agricultural Marketing Corpora tion, defines its functions (to establish and 
maintain an efficient system of marketing for agricultural produce by securing the most 
favourable arrangements for the purchase, hand ling, sale and exportation of agricultural 
produce) and its powers 
Agricultural Produce Act, 
1926 1975 Provides for and regulates the licensing of pe rsons carrying on trade or business of buying 
or selling, or of buying and exporting agricultural produce 
Agricultural Small Holdings Act, 1946 1995 Regulates the contracts of tenancy and provide s for the establishment of valuation boards, 
that have the power, among others, to fix th e maximum economic rent for small holdings 
Animals (Diseases and 
Importation) Act,  1948 1969 Provides for the control of diseased or susp ected animals and prohibits imports of birds, 
reptiles and insects except under a licence by the Director of Veterinary Services 
Irrigation Act, 1949 1999  Grants the Minister the power to  licence a company to be an Irrigation Authority and 
establishes its powers and duties 
Import Prohibition (Coffee) Order, 1966 No 
amendment Forbids imports of coffee other than coffee (parchment, green or clean,  roasted and 
soluble), imported by the Coffee Industry Board (a permit from the Ministry of Agriculture is required) 
Jamaica Agricultural Society Incorporation Act, 1941 1996 Creates and regulates the functioning of the Jamaica Ag ricultural Society 
Plant Quarantine Act, 1993  No 
amendment Regulates the plant quarantine regime 
Rural Agricultural 
Development Authority 
Act, 1990 2002 Establishes the Rural Agricultural Developmen t Authority and defines its functions, such 
as providing agricultural extension services; securing the economic and efficient utilization 
of land;  encouraging improvement works in the rural areas 
 .. Not available.  
Source:  WTO Secretariat. 
19. The Government has set poverty alleviation a nd food security as goals in its Agricultural 
Policy Framework.  These two objectives are to be  attained through enhanced efficiency and 
productivity in the various subsectors (sugar, banana, coffee, citrus, livestock, and domestic crops);  
provision of support services including research, deve lopment and extension services, and training;  
improving agri-processing;  increasing exports of  traditional and non-traditional commodities;  
continued provision of concessions in financ ing;  and rehabilitation of infrastructure.5  In addition, as 
an important amount of the raw material used in the food processing industry is imported, the 
                                                      
5 Ministry of Agriculture (2004a). Jamaica WT/TPR/S/139/Rev.1 
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Government encourages "import displacement", th at is, substituting these raw material (by local 
production (Chapter II(ii)).6  According to the authorities, hi gh import duties on certain agricultural 
products are used to support production by local farmers with the purpose of contributing to the 
Government's efforts with respect to  poverty alleviation in rural areas. 
20. The modernization efforts for sugar industry are set  out in a "green paper" tabled in the House 
of Representatives in April 2004;  the paper provid es for major restructuring of the sugar industry, 
including mergers and closures and using lands under sugar for the production of other crops. 
21. Jamaica participates in certain product-specific international arrangements, for example, the 
International Sugar Agreement, International Coff ee Agreement, and International Cocoa Agreement, 
which provide market and trade information.  The intergovernmental organizations, created under 
each of the agreements, seek to improve world ma rket conditions through debate, analysis, special 
studies, and transparent statistics.  According to the authorities, the Jamaican industry benefits from 
worldwide forum provided by these organizations.  It is also a signatory of the Agreement Establishing the International Fund for Agricu ltural Development (IFAD), and Convention on the 
Inter-American Institute for Cooperation on Agricu lture (IICA).  The IFAD assists the sector to 
enhance food security, and raise productivity and income levels.  The IICA assists the agricultural 
sector through the promotion of joint programmes.  It helps to promote the better use and management 
of natural resources and the environment, contri bute to rural development and food security, and 
enhance the technical and managerial competences of the stakeholders. 
22. Assistance for agriculture is provided mainly through tariffs (see next section).  Some 
assistance is also provided through different product- specific projects or those linked to infrastructure, 
irrigation, and the fight against plant diseases (see section (c)). 
(b) Market access 
23. Under its Uruguay Round commitments, Jamaica bound its agricultural tariffs at 100%, with 
the exception of pre-UR bindings (varying between  0% for bulbs, tubers and seeds and 10% for 
organic chemicals, and a specific rate of J$0.30/1 00lb for linseed oil).  Other duties and charges on 
agricultural products were bound at 15%, except on 56 products for which rates were bound at 80%, 
and three sugar products at 200% (other  than raw sugar) (Chapter III(2)(iv)). 
24. Since its last Trade Policy Re view, Jamaica has raised its customs duty from 40% to 100% 
(which corresponds to the bound tariff level) on im ports of tomatoes, cabba ges, cabbage and other 
lettuce, carrots, and poultry.
7  Other agricultural products face a maximum import tariff of 40%.  
Applied MFN tariffs on agricultural products range between 0 and 100% (Chapter III, Table III.1);  
the simple average (WTO definition of agriculture) is 18.1%. 
25. By the Provisional Collection of Tax (Stamp Duty) (No. 2) Order, 26 April 2002, the 
Government increased aggregate import duties on certa in agricultural products (Chapter III(2)(ix)).  
Duties were increased from 86% to 260% for poultry products (whole broilers, frozen, and fresh or 
chilled);  chicken leg quarters, legs , thighs, and drumsticks (fresh or  chilled, and frozen); and chicken 
wings (fresh or chilled, and frozen).  Duties were  also increased from 80% to 260% on vegetables 
(fresh or chilled), such as tomatoes, cabbage, lettuce, and carrots. 
26. The GCT is applicable to agricultural goods (imported and domestically produced) at the 
standard rate of 15%.  A number  of products, however, are exempt  from this tax under the General 
                                                      
6 Minister of Agriculture (2003). 
7 The Provisional Collection of Tax (Customs Duties) (No. 2) Order, 2002. WT/TPR/S/139/Rev.1 Trade Policy Review 
Page 96 
 
 
Consumption Tax Act, amended in 2003.  In addition, a wide range  of agricultural products are 
subject to additional stamp duties, while alcoholic be verages and tobacco products are also subject to 
a special consumption tax.  An excise duty was re -introduced in 2003 on tobacco and certain tobacco 
products (Chapter III(2)(ix)).  
27. Imports of milk and cream, and some vegetables are subject to automatic import licensing 
(Table III.5 and Table IV.3) for SPS purposes.  Th ere are no quantitative restrictions on imports of 
agricultural products.  The authorities note that th e import prohibition on coffee berries, citrus fruits 
and plants, banana, and raw honey is based on the hi gh risk of introduction into Jamaica of certain 
exotic pets and diseases;  and that the importati on of soil is prohibited because of the risk of 
introducing pests.  The importation of fruits that  are known sources of pests not known to exist in 
Jamaica is prohibited. 
Table IV.3 
Import and export reg ulations for selected agricultural productsa, 2004  
Product Regulation 
Imports  
Fresh fruits and vegetables Import permit and phytosanita ry certificate required 
Dried or frozen fruits and ve getables and processed plant 
materials No import permit or phytosan itary certificate required 
Coffee Importation of coffee berries is prohibited. Roasted coffee and coffee in 
parchment may be imported by permit from the Ministry of Agriculture through the Coffee Industry Board 
Citrus Importation of citrus fruit pl ants or parts thereof is forbidden 
Banana Importation of fruit and plan ts is prohibited; importation of in vitro  suckers 
is restricted 
Bees and bee products Importation of raw honey, unprocessed wax, bees, pollen and other live 
products is prohibited Importation of processed wax for co smetics or manufacturing purposes 
requires a permit 
Plants Import permit required. Importati on of finished plants in growing media 
prohibited. Plants must be bare-rooted; seedlings in liners or small pots 
Soil Importation of soil is prohibited 
Fruit Importation of mango, naseberry, an d tropical soft fruits is prohibited 
Root crops Importation of yam, dasheen, and  sweet potato is prohibited 
Exports  
Pimento Export of plants, cuttings or seeds of pimento is prohibited. Commercial 
exportation of pimento is allowe d only by authorized exporters 
Ginger Export of all portions of Jamaican  ginger is prohibited except by special 
permit from the Ministry of Agriculture. Peeled dried ginger may be exported 
Coconut Coconut Industry Board is the onl y body authorized to export coconut or 
grant a licence for its exportation 
 
a These measures are applied under the Customs Act or the Plant Quarantine Act. 
 
Source:  Information provided by the Jamaican authorities. 
28. A new regime for imported refined sugar became  effective 1 January 2004, replacing the two-
tiered tariff system, under which the manufacturers could import sugar duty fr ee, and importers of 
sugar going to the retail trade paid the CET of 40% and a stamp duty of 63%.  The new regime was 
introduced due to the difficulties in monitoring the payment of duties under the two-tiered tariff 
system.  According to the new regime, manufacturer s using imported refined sugar as input, and sugar 
traders, are required to register with the Trade Bo ard in order to continue to benefit from stamp duty Jamaica WT/TPR/S/139/Rev.1 
 Page 97 
 
 
relief on imports of refined sugar (Chapter III(2 )(ix)).  Registration requirements include, an 
application for import quantities and a pre-entry verification of the manufacturing process, which 
involves verification of the production process to de termine qualification as a bona fide manufacturer, 
and examination of production records, accounting records, import entries, and invoices. 
29. The only restrictions on imports at the CARICO M level vis-à-vis third countries other than 
CET, concern the arrangements concerning oils and fats  (Chapter III(2)(vii)).  Under these 
arrangements, Jamaica, together with other deficit countries, is required to purchase crude coconut oil 
and copra from CARICOM surplus countries at prices agreed between buyers and sellers on the basis 
of world market prices and costs of production.  This has the effect of prohibiting imports from non-
CARICOM countries unless surplus countries cannot cover demand from deficit countries. 
(c) Export and domestic support 
30. Jamaica notified the WTO that in 1998 it did not use export subsidies;  according to the 
authorities, this also true for the period 1999-03 (t here has been no notification in that respect).8  It has 
also notified domestic support measures (green box) applied during the period 1998 to 2000.9  
Agricultural exporters can benefit from export financ ing at a preferential rate (Chapter III(3)(v)(b)).  
Incentives under the Export Industry Encouragemen t Act (EIEA) (Chapter III(3)(iv)(a)) are not 
granted to unprocessed agricultural products;  however , they are applicable to agri-industrial products. 
31. To encourage agricultural production, the Income Tax Act, 1982, grants income tax relief to 
any person engaged in an agricultural activity prescr ibed by the Minister of Finance and declared 
"approved farmer".  So far, the prescribed activ ities include growing food crops, seeds, trees for 
timber production, and tobacco;  horticulture;  fishi ng and fish farming;  cattle, dairy cattle, sheep, 
goat, and pig breeding;  production of fertile eggs for hatching and table eggs;  apiculture;  and horse 
breeding (cattle farmers and horse breeders must intend to increase the herd by at least 10%).10  
Income tax relief is granted for ten years.  In add ition, farmers and farming enterprises are eligible for 
a duty concession on the importation of farm vehicles;  the beneficiaries pay a duty of 20% rather than 
the usual rate of 55%-180%.  Moreover, the CARI COM policy allows for goods used as agricultural 
inputs including insecticides and herbicides, planting material and fertilizers, to be accorded duty free 
treatment.  Farmers and farming enterprises are also exempted from GCT on certain items listed as exempted or zero rated under th e General Consumption Tax Act Chapter III(2)(ix)).  However, 
agricultural equipment that was subject to GCT of 0% until 2003, is subject to  the standard rate of 
15%. 
32. Jamaica provides its farmers a number of agricultural support services to develop the sector 
and enhance its competitiveness.  These services  include research and development relating to 
livestock research and improvement, crop research a nd plant protection, and extension and advisory 
services.  The Government also provides veterinary services (e.g. training, laboratory services, pesticide distribution, artificial insemination) and the development of technology services (e.g. 
improved technology training).  According to the data provided by the authorities, these measures 
amounted to US$9.3 million during the 1999/ 00 and to US$13.9 million in 2002/03. 
33. Domestic support to the sector also includes the allocation of funds for a number of 
development projects.  Projects established since Jama ica's last Review and currently in force;  are 
                                                     
 
8 WTO document G/AG/N/JAM/3, 21 October 1999. 
9 WTO documents G/AG/N/JAM/2, 12 June 1 998; G/AG/N/JAM/4, 21 October 1999;  and 
G/AG/N/JAM/5, 26 March 2001. 
10 The Income Tax (Prescribed Agricultural Activities) Order 1982;  the Income Tax (Prescribed 
Agricultural Activities) Order 1983;  and information provided by authorities. WT/TPR/S/139/Rev.1 Trade Policy Review 
Page 98 
 
 
mainly product specific, or concern infrastructur e, irrigation or the fight against plant diseases 
(Table IV.4).  The principal agricultural project in 2002 was the Agriculture Support Services Project 
(ASSP).  The Project allocates a budget of US$1 million for funding agricultural support services (maximum grant US$30,000 per beneficiary), and US$6 million for funding high pay-off productive 
projects (maximum grant is US$300,000, not availa ble for individuals).  The beneficiaries are 
required to provide a minimum 10% of the grant amount for services and 20% minimum for shared capital investments (in cash and/or in kind).  As at July 2004, 19 high pay-off productive projects had 
been approved.
11 
34. The Citrus Replanting Project provides for a public education programme, technical services 
(certification, extension, research, implementation management) and credit services.  To benefit from 
the credit facility, small-scale citrus growers have  to provide 20% equity, and medium and large-scale 
growers 30% equity in cash or kind (labour, material ).  The interest rate was lowered in 2002 from 
13% to 9%. 
35. The Domestic Food Crop Production and Marketing Project provides for the use of improved 
technologies of production.  Support is provided th rough training, research programmes, assistance to 
produce insect-free nurseries, coordinating marketi ng, establishing irrigation systems, equipment 
renting, providing Miniset technology for ya m production, land preparation, and project 
administration.12 
Table IV.4 
Agricultural projects in Jamaica, 2004 
Objectives Beneficiaries Implementation date and 
duration Original project cost and source of 
funding 
Agriculture Support Services Project (ASSP) 
Enhancing the 
competitiveness of 
Jamaican agriculture Agricultural producers, 
farmers, or exporters Implemented: January 2001 
2001-2004;  extension to be 
sought to 2007 US$31.5 million 
US$22.0 million loan from the Inter-
American Development Bank (IDB);  
US$8.6 million from the Government of Jamaica;  US$0.9 million from project 
beneficiaries 
Banana Support Programme 
Promoting sustainable 
development;  and 
improving living 
standards of farmers Farmers, farm and port 
workers in 5 banana growing 
parishes Implemented: 1999 
1999-2003 
Project (phase 2);  extension 
sought to 2008  €4.7 million 
EU; 
Government of Jamaica 
Citrus Replanting Project 
Preventing the decline of the industry because of 
the Citrus Tristeza Virus (CTV);  
Increasing production 
through the use of certified CTV-free planting material Bone fide small, medium 
and large scale citrus 
growers Implemented:  January 2001 
2001-2005 US$ 20.4 million 
US$9.9 million loan from CDB; 
US$0.26 million grant from CDB;  US$5.69 million from Government/DBJ; 
US$4.6 million from others 
Cocoa Rehabilitation Project 
Increasing and sustaining 
production in the shortest time possible (6-12 
months after applying 
inputs) Cocoa farmers Implemented:  July 2003 J$3.7 million 
Development Bank of Jamaica; the Cocoa Industry Board in collaboration 
with the Ministry of Agriculture 
Table IV.4 (cont'd) 
                                                      
11 Ministry of Agriculture, Programmes and projects within  the Ministry of Agriculture , available at:  
http://www.moa.gov.jm/projects;  and Capital "B" Projects Status Report , available at:  http://www.moa. 
gov.jm/projects/MOACAPITALPROJECTFROMINCEPTION2003.pdf. 
12 Miniset technology is a method used to produce a particular size of tuber. Jamaica WT/TPR/S/139/Rev.1 
 Page 99 
 
 
Objectives Beneficiaries Implementation date and 
duration Original project cost and source of 
funding 
Domestic Food Crop Production and Marketing Project (Phase IV) 
Increasing production of selected crops Farmers in 10 parishes to 
produce tomatoes, hot pepper, sweet potatoes, yams 
exotic vegetables, carrot, red 
coco, scallion, and other selected food crops Implemented:  April 2001 
1999-2000, (extended on a yearly basis since 2000);  
present extension until 
March 2005 J$100 million 
Government of Jamaica funded project 
from PL480 funds
a 
Eastern Jamaica Agricultural Support Project 
Increasing production 
and productivity of  products with 
competitive advantage in 
the domestic, tourism and non-traditional export 
markets Small-scale farmers in 4 
eastern parishes Implemented:  January 2000 
2001-03 extended to December 2004 €7.1 million 
€6.0 million funded by the EU €1.1 funded by the Government 
Fruit Tree Crop Project 
Increasing income for rural households; 
encouraging 
environmental conservation measures; promoting the 
development of food 
processing industry; increasing the availability 
and diversity of fruit tree 
species;  and providing for foreign 
exchange through exports Farmers, Government 
agencies, sugar factories, 
and entrepreneurs. Implemented: January 2000 
2000-03 then extendable on 
yearly basis; currently 
extended to March 2005  J$100 million 
Government of Jamaica, funded project 
from PL480 funds
a 
Jamaica Milk Marketing Project 
Improving market 
conditions for local 
production Dairy farmers Implemented:  1999 
1999-2006  J$418 million 
Loan J$380 million by Government of 
Jamaica from PL480 fundsa; 
Farmers equity J$38 million 
National Irrigation Development Programme 
More efficient allocation 
of the irrigation water 
resources Farmers in specified 
geographic areas Implemented:  2002 
2002-2007 US$20 million 
US$4 million funded by the Government 
US$16 million funded by IDB 
New World Screw Worm Project 
Eradicating screwworms 
from the island in a rapid 
and efficient manner; Preventing reinfestation 
when eradication has 
been achieved Domestic, commercial 
animal owners and the 
general public Implemented:  July 1998 
1998-2001 
extended to March 2005 US$9.9 million 
(J$329.7 million) 
Government of Jamaica from PL480 
fundsa; 
IAEA; 
USAID 
 a PL480 funds are funds made available under Public Law 480 of the United States (i.e. the Agricultural Trade Development 
 and Assistance Act). 
 
Source:  WTO Secretariat, based on the informati on provided by the Jamaican authorities. 
36. The Fruit Tree Crop Project provides for devel oping and producing commercial orchards of 
traditional fruit tree crops, and providing raw material s for processing industries.  Beneficiaries are 
given a land preparation grant and assistance for st art-up activities (such as lining out and preparation 
of holes for planting).  The maximum benefit is J$14,800 per hectare for minimum two and maximum 
50 hectares.13 
                                                      
13 Ministry of Agriculture, "Programmes and projects within the Ministry of Agriculture".  Available 
at:  http://www.moa.gov.jm/projects/. WT/TPR/S/139/Rev.1 Trade Policy Review 
Page 100 
 
 
37. The Jamaica Milk Marketing Project aims to  reduce foreign expenditure on milk solids 
through reducing milk packaging and processing co sts (through economies of scale) and lowering the 
market margin (through direct retailing vi a a network of superm arkets and kiosks).14  The National 
Irrigation Development Programme realizes its objec tives through the construction and rehabilitation 
of irrigation systems.  The Eastern Jamaica Ag ricultural Support Project intends to obtain its 
objectives through sustainable and environmen tally positive production methods and improved 
marketing.  The Banana Support Programme pr ovides, among other things, for the supply of 
agricultural equipment (excavators, chemicals, fertilizers, and vehicles). 
38. As sugar, bananas, and rum still receive some  preferential treatment, Jamaica is seeking the 
extension of preferences.  In 2002, the Government  and the European Union signed the Framework of 
Mutual Obligations concerning the stabilization of export earnings (STABEX) transfer for 1999 and 2000.  Implementation of this framework should be completed by 31 December 2004.  The 1999 and 
2000 STABEX repayments support the road re habilitation programme implemented under the 
ongoing Eastern Jamaica Agricultural Support Project .  Jamaica also benefits from a Financing 
Agreement signed in January 2002 under the EU's four-year Integrated Development Programme for 
the Caribbean Rum Sector.  The project is aimed at enhancing the competitiveness of the sector by 
making it export-ready in the segment of branded pr oducts.  The total project cost is estimated at 
about €146 million, of which €70 million will be funded by EC, and the rest from intra-ACP 
resources. 
39. The National Irrigation Commission (NIC) produces and distributes irrigation water to its 
agricultural and non-agricultural customers.  As a result of the amendment to the Irrigation Act in 
1999, the NIC was licensed as  the irrigation authority for ten more  years.  The rates for farmers are 
financed partially by the Government as they are required to pay a rate th at covers NIC's operating 
costs only.  In March 2001, the level of the fina ncial support was 60% of operating costs;  it is 
expected to be reduced gradually to attain full cost  recovery in 2005.  Other public services, such as 
electricity and transport are not provided to farmers at concessionary rates. 
40. In order to mitigate high interest rates on loans,  the Government set up a special interest rate 
regime for loans granted by the EX-IM Bank and the Development Bank of Jamaica (DBJ)
15, 
allowing exporters (Chapter III(3)(v)(b)) and producers to benefit from interest rates varying up to 
13%.  Agricultural credit is allocated by the DB J through the Peoples' Cooperative banks and other 
approved financial institutions, mainly for agricu ltural purposes, and for rebuilding after natural 
disasters, but also for repairing farm buildings a nd for providing and maintaining water supplies.  
Credit allocated by the DBJ to financial institutions  in 2002/03 was estimated at J$8,718.59 million.16  
Another source of credit for the sector is the Jama ican Agricultural Development Foundation.  The 
main beneficiaries of the loans have been produ cers of citrus, poultry, coffee, sugarcane, yam, 
vegetables, and other mixed crops, and agri -processors producing meat, juices, and milk. 
41. Access to loans for many small-scale farmers is hampered by the insecurity created by the 
land tenure system, which is based on a mixture of  customary norms and formal legal structure;  
approximately 60% of the land is  owned under a registered title.17  The National Land Agency, which 
became operational on 1 April 2004, has been estab lished to reform the process of assigning land 
ownership. 
                                                      
14 Jamaica Sustainable Development Network, "Livestock".  Available at:  http://www.jsdnp.org. 
jm/susAgriculture-livestock.htm. 
15 Formerly the National Development Bank and the Agricultural Credit Bank. 
16 Ministry of Finance and Planning, "Public Sector Entities, FY 2003/2004".  Available at:  
http://www.mof.gov.jm/downloads/2003/ped/dbj.pdf. 
17 Inter-American Development Bank (2002). Jamaica WT/TPR/S/139/Rev.1 
 Page 101 
 
 
(d) Public sector entities 
42. In the past, the marketing of  cocoa, coconut, coffee, sugar, and bananas was through 
commodity boards (Chapter III(4)(iii)(a)), which were sole buyers and sellers of the respective crop.  
Their main role was to facilitate product marketi ng and stabilize producer returns.  All these boards 
still hold regulatory powers (Chapter III(4)(iii)).  However, their role has been reduced and  currently 
they operate mainly as providers of services (Table III.11). 
43. Through the respective boards, the Government  also manages the Banana Insurance Fund 
(a mandatory insurance scheme) and Windstorm Insu rance Fund for coconut, to assist banana and 
registered coconut growers in the case of loss due to hurricanes or windstorms (Table IV.5). 
44. The Cocoa Industry Board, Coffee Industry Board and the Export Division of the Ministry of 
Agriculture (the latter for pimento, ginger, and turm eric only) are engaged in exports;  no state entity 
is involved in import activities. 
45. The National Rums of Jamaica Ltd is a Government owned company, producing rum and 
alcohol through two subsidiaries, Clarendon Distilleries Ltd and Long Pond Distilleries.  It also has 
the responsibility to identify new markets, and to  promote and market products manufactures by its 
subsidiaries. 
Table IV.5 
Public entities in the agriculture sector, 2004 
Entity and legal basis Main source of income Revenue/net surplus or deficita,  
J$ million (year) 
Agricultural Development Corporation  
Agricultural Development Corporation Act, 1952 Sales 9.5/-15.0 (2002/03) 
Agricultural Marketing Corporation  
Agricultural Marketing Corporation Ac t, 1963 Rental/lease 11.9/-5.5 (2002/03) 
Banana Board  
Banana Board Act, 1953  Germ plasm 4.4/-1.6 (2002) 
Banana Insurance Fund  
Banana Insurance Fund Cess on bananas 18.1/-1.2 (2002) 
Cocoa Industry Board  
Cocoa Industry Board Act, 1957 Export sales 43.7/3.9 (2001/02) 
Coconut Industry Board   
Coconut Industry Control Act, 1945 .. .. 
Coffee Industry Board  
Coffee Industry Regulation Act, 1948 Export sales 957.3/124.0 (2002/03) 
Sugar Industry Authority  
Sugar Control Act Cess on sugar 226.2/29.9 (2001/02) 
 
.. Not available 
 a Estimate. 
 
Source:  WTO Secretariat.  
(3) MINING AND MINERAL PROCESSING  
46. The mining sector is an important source of foreign exchange for Jamaica, due primarily to 
bauxite and alumina production, which in 2002 acc ounted for about 98% of output in the sector.  
Jamaica is the world's fourth largest producer of  bauxite and alumina after Australia, Guinea, and 
Brazil.  It remains a relatively low-cost bauxite  producer, mainly due to the proximity of production WT/TPR/S/139/Rev.1 Trade Policy Review 
Page 102 
 
 
areas to ports, and favourable geology.  Exports of mining products, generating some 
US$769.1 million in 2003 are Jamaica's second larg est foreign currency earner, after tourism18;  in 
2002 they represented about two thirds of mercha ndise exports.  The contribution of mining and 
quarrying to GDP (including alumina production) has been stable and accounted for 4.1% of GDP in 
2002 (Table I.1).  Mining is capital-intensive, em ploying only some 8,000 people in 2002 (5,480 in 
bauxite and alumina production and around 3,000 in  quarrying).  Jamaica also exports gypsum, 
limestone, gravel, and sands. 
47. The overall volume of mining production in Jamai ca decreased in 1998 and 1999 but began to 
increase again in 2000, with bauxite and alumina production peaking in 2003 due to the significant 
growth in demand for aluminium in China.  The do wnward trend in alumina prices was reversed in 
2002;  contract prices increased from US$179 to US$200 per tonne at the end of 2003 (and spot prices increasing from US$130-140 per tonne to more than US$400 per tonne),  helping to increase the value 
of Jamaican mineral exports. 
48. International companies dominate the bauxite and alumina industry and produce, through 
their local subsidiaries, all the bauxite and alumin a in Jamaica (Table IV.6).  Five bauxite mines 
produce more than 13 million tonnes a year (around one tenth of world production).  One third of total 
bauxite production is exported as ore to the United States;  the rest is  treated in domestic refineries 
and exported as alumina, mainly to the European Union, Canada, and United States (Table IV.7). 
Table IV.6 
Operators in the bauxite and alumina sector, 2004 
Company Ownership Year established 
Bauxite   
Kaiser Jamaica Bauxite Company (KJBC) 49% - Kaiser (USA) 
51% - Government through Jamaica Bauxite Mining Ltd 1952 
Jamaica Bauxite Mining Ltd 
(JBM)/Lydford Mine 100% - Government 1952 
Alumina   
West Indies Alumina Company 
(WINDALCO) 93% - Glencore International AG (Switzerland) 
7% - Government through Jamaica Bauxite Mining Ltd 1952 and 1959 
Jamalco 50% - Alcoa Mine rals of Jamaica (USA) 
50% - Government through Clarendon Alumina 
Production (CAP) Bauxite 1963 
Alumina 1972 
Alumina Partners (Alpart) 65% - Glen core International AG (Switzerland) 
35% - Norsk Hydro Aluminium (Norway) 1969 
 
Note:  WINDALCO was created in 2001 when Glenco re Alumina Jamaica Ltd acquired Alcan's  93% interest in the joint venture 
 (Jamalcan) between Aluminum Company of Cana da (Alcan) and the Gove rnment of Jamaica. 
Source: Jamaica Information Service, "The Jamaica Bauxite Institute".  Availa ble at:  http:// www.jis.gov.jm/Jamaica 
BauxiteInstitute/index.asp. 
49. The bauxite and alumina industry is expanding.  In early 2004, Alcoa announced its decision 
to more than double the capacity of its Jamalco Re finery to 2.65 million tonnes and expansion of the 
Alpart plant to 1.7 million tonnes has been complete d.  Smaller expansions are also planned for the 
other alumina plants.  The sale of Kaiser's shares in KJBC and in Alpart is not expected to affect 
production.19  Capacity utilization is already high:  in  2003, it was estimated at 85.5% of installed 
capacity for bauxite, and 99.8% for alumina;  during the first five months of 2004 the figures were at 
92.4% and 100.6% respectively. 
                                                      
18 The Planning Institute of Jamaica (2003). 
19 Kaiser Aluminium sold its interest in Alpart to Hydro Aluminium in 2004, and is planning to sell its 
interest in KJBC to a joint venture between Century Aluminium Co. and Canada's Noranda Inc. Jamaica WT/TPR/S/139/Rev.1 
 Page 103 
 
 
50. The mining sector is governed by the Mining Ac t, 1947;  the Mining Regulations, 1947;  the 
Minerals (Vesting) Act, 1947;  the Mining (Safet y and Health) Regulations, 1977;  the Bauxite and 
Alumina Industries (Encouragement) Act, 1950;  th e Quarries Control Act, 1984;  the Quarries 
Regulation, 1957;  the Bauxite (Production Levy) Ac t, 1974;  and the Bauxite and Alumina Industries 
(Special Provisions) Act, 1977.  The Quarries Cont rol Act is in the process of amendment; mining 
regulations were amended in 1999 and are being amended again.  Most of these Acts and Regulations 
have been modified at least once.  The Minist ry of Land and Environment and the Cabinet are 
responsible for policy formulation in the mining sector.  The Jamaica Bauxite Institute, a research 
institute, is in charge of monitoring the indus try, providing advice on the negotiation of various 
agreements, and making recommendations to ensure  pollution controls and other environmental 
programmes. 
Table IV.7 
Bauxite and alumina sector performance, 1998-03  
 1998 1999 2000 2001 2002 2003a 
Crude bauxite       
Production ('000 tonnes) 4,034.6 2,794.6 2,062.0 3,635.0 4,066.6 3,849.3 
Exports ('000 tonnes) 4,020.2 2,795.4 2,118.9 3,617.8 4,074.1 3,805.8 
Exports (US$ million) 81.0 55.9 44.7 94.4 102.5 95.8 
Alumina       
Production ('000 tonnes) 3,440.2 3,569.6 3,600.1 3,542.4 3,630.6 3,843.6 
Exports ('000 tonnes) 3,476.6 3,607.2 3,642.5 3,552.0 3,635.9 3,839.9 
Exports (US$ million) 600.7 631.7 696.0 642.7 610.7 673.3 
Total bauxiteb       
Production ('000 tonnes) 12,646.4 11,688.5 11,126.5 12,369.6 13,119.5 13,444.5 
Exports ('000 tonnes)  12,719.4 11,789.5 11,283.1 12,384.8 13,141.8 13,386.9 
Levy/tax (US$ million) (1) 82.4 59.1 74.6 70.5 52.4 51.9 
Royalty (US$ million) (2) 5.8 5.9 5.3 5.6 6.3 9.4 
Local cost and net forexc 
(US$ million) (3) 248.9 251.4 245.4 322.7 319.8 263.6 
Foreign exchange inflows  
(US$ million) (4) = (1)+(2)+(3) 337.1 316.4 325.4 398.9 378.5 325.0 
 
a Preliminary. 
b Total bauxite is the sum of crude bauxite and of   unprocessed bauxite used in alumina production. 
c Net Forex is earnings by the Government owned entities in the Bauxite/Alumina sector. 
 
Source: Planning Institute of Jamaica (2002) and (2003), Economic and Social Survey . 
51. All minerals in Jamaica are vested in and u nder the control of the Crown.  Mining of any 
minerals is subject to the payment of a royalty to  the Government;  if the land does not belong to the 
State, part of the royalty is paid to the owner.  The royalty rate is US$0.50 per long dry tonne on bauxite or laterite dried or processed into alumin a;  the rate on other minerals is 3.5% of the 
commercial value for metallic minerals, and of the mine-gate value for industrial minerals. 
52. The Government does not intervene in setting mineral prices.  There are no restrictions on the 
importation or exportation of mine rals;  however, under the Mining Ac t, all exports of minerals 
require an export permit from the Ministry of Land and Environment, attesting that the royalties have 
been paid.  According to the Mining Act, to undert ake mining activities, companies have to apply for 
a mining lease, granted for a period of 25-year (re newable for a further 25 years);  many of the 
bauxite mining companies, however, operate on 40- year special mining leases, as the Mining Act 
grants the responsible minister power to award special mining leases for periods he deems 
appropriate.  The applicant must hold of a prospec ting right (to carry out a general prospecting work) WT/TPR/S/139/Rev.1 Trade Policy Review 
Page 104 
 
 
or an exclusive prospecting licence (specifying the mineral, the locality, and the area), and an 
environmental permit from the National Environment and Planning Agency (NEPA). 
53. A policy document governing quarrying operations in Jamaica has been prepared;  it deals 
with illicit quarrying among other issues pertinent to th e subsector.  A national minerals policy is also 
being prepared.  The latter policy is expected to  address a wide range of issues relating to the 
development  of minerals including the manageme nt of mineral-bearing lands, development of the 
non-bauxite mineral sector, granting licences, m onitoring and enforcement, penalties for non-
compliance and, requirements and arrangements for r estoration of mined-out areas, sector-specific 
education and training, research and development, and management of demand for mineral materials. 
54. Apart from royalties, there is a bauxite levy, at  a basic rate of US$5 per tonne of bauxite 
production;  this rate increases in direct proportion  with the average realized price per tonne for 
primary aluminium.  In November 1999, to encour age expansions of the industry, the Government 
agreed to exclude from the levy any additional capacity  created by plant expansion.  In 2002, also to 
encourage investment, the Government started a phase-out of the bauxite levy, which is being replaced by an income tax regime, negotiated company-by-company.  Revenue accruing from the 
bauxite levy was estimated at US$65.4 million in 2002, or 2.4% of total government revenue in 
2002/03, down from 5% in 1996/97. 
55. Incentives for the bauxite and alumina industry are granted by the Bauxite and Alumina 
Industries (Encouragement) Act, 1950, as amended.  Businesses engaged in the mining of bauxite or 
the production of alumina qualify for customs duty exemption on imports of capital goods;  and for 
duty concessions and exemption from the special consumption tax on lubricating oil, greases, and 
other petroleum products/other chemicals used by  the industry.  Items acquired under the Act are 
zero-rated for GCT purposes.  These concessions have been extended on a case-by-case basis to big quarrying operators.  The industry can also benefit from other non-industry-specific incentives schemes (see Chapter III(2)(viii), (3)(iv)  and (4)(ii)).  Tariffs applied on imports of aluminium ores 
are 10%;  and of alumina 15%. 
(4) O
THER MANUFACTURING  
(i) Overview 
56. The manufacturing sector (including mineral and food processing) accounted for 13.5% of 
Jamaica's GDP in 2003, down from 14.3% in 1999.  Th e sector employed 7.0% of the labour force in 
2003, also down from 8.8% in 1998.20  Excluding processed food, beverages, and tobacco and tobacco 
products, the sector's share of GDP was 6.0% in 2003, down from 6.7% in 1998.  The overall decline 
reflects the poor performance of some traditional indu stries, notably textiles and clothing.  Jamaica is 
a significant net importer of manufactures;  imports are more than three times higher than exports.  
The share of manufactured products in total exports has decreased sharply, from 23.7% in 1998 to 9.9% in 2002 (including processed food, bevera ges, and tobacco, but excluding exports from export 
free-zones). 
57. The largest manufacturing subsector is food, beve rages and tobacco (Chart IV.3).  The other 
main subsectors are petroleum re fining (2.1% of GDP), machinery and equipment (1.9% of GDP);  
and chemical, rubber and plastic pr oducts (1.0% of GDP).  While shar es of most of subsectors have 
been relatively constant since 1998, the share of te xtiles and apparel decreased from 0.9% in 1998 to 
                                                     
 
20 Statistical differences between this section and Chapter I are due to variations among different 
government sources. Jamaica WT/TPR/S/139/Rev.1 
 Page 105 
 
 
0.1% in 2003.  Petroleum refining is the only sub sector for which GDP share increased (from 1.1% in 
1998 to 2.1% in 2003). 
58. Manufacturing output in constant values (1995 J$) has been decreasing for all subsectors, 
with the exception of petroleum refining (Table IV.8 ).  The biggest decrease has taken place in textile 
and clothing sector (see below).  In 2003, the output  of petroleum products also declined due to a 
scheduled closure for repairs and maintenance of Jamaica's only refinery.  The manufacturing 
subsectors that saw their production increase were  food processing and chemical products (mainly 
production of paint and fertilizers). 
Chart IV.3
Manufacturing GDP by subsector, 1998 and 2003
1998 2003
Total: J$36,711 million
Source:   WTO Secretariat, based on data provided by the authorities of Jamaica.Total: J$59,105 millionFood
23.4%
Non-metallic 
products
5.2%
Non-alcoholic 
bev.
1.7%Alcoholic 
beverages
10.7%
Textiles & 
clothing
6.3%Leather
0.4%Tobacco
12.7%Food
23.2%
Alcoholic 
beverages
12.6%
Non-alcoholic 
beverages
2.5% Tobacco
10.8%
Leather
0.4%Furniture
1.7%Non-metallic 
products
5.5%(Per cent)
Sugar & ru m
3.3%
Paper
3.5%Petroleum
7.7%Other
0.4%
Furniture
2.2%Sugar & ru m
2.9%
Textiles & 
clothing
0.9%Chemicals
8.2%Metal 
products
14.2%
Paper
3.0%Petroleum
15.7%Chemicals
7.8%Metal 
products
12.6%Other
0.3%
 
Table IV.8 
Manufacturing output and GDP, 1998-02 
(In constant 1995 prices, J$ million) 
1998 1999 2000 2001 2002 
Output GDP Output GDP Output GDP Output GDP Output GDP 
Total manufacturing (including pro cessed food, beverages and tobacco) 
81,752.6 25,944.5 83,352.9 26,320.3 83,617.4 26,039.0 82,645.2 26,620.5 80,783.6 26,311.4  
Textiles and wearing apparel 
6,747.0 1,628.5 5,418.7 1,308.6 4,964.1 1,198.1 3,081.9 745.6 1,216.0 296.1  
Leather and leather products, footwear 
459.4 109.9 432.8 103.7 391.6 93.6 307.0 78.0 308.5 79.7  
Table IV.8 (cont'd) WT/TPR/S/139/Rev.1 Trade Policy Review 
Page 106 
 
 
1998 1999 2000 2001 2002 
Output GDP Output GDP Output GDP Output GDP Output GDP 
Furniture and fixtures, wood, wood and cork products 
1,705.3 566.1 1,709.3 567.8 1,482.0 492.7 1,505.9 500.4 1,493.5 496.2  
Paper and paper products, printing and publishing 
2,302.5 902.8 2,275.7 890.8 2,220.2 874.3 2,092.3 825.7 2,035.8 809.2  
Petroleum refining 
6,745.4 2,003.3 9,242.1 2,369.2 12,613.5 3,086.8 12,944.5 3,763.3 13,203.2 3,838.5  
Chemicals, chemical products, rubber and plastic products  
5,924.0 2,122.0 6,058.8 2,173.0 5,725.0 2,056.1 5,705.9 2,052.4 5,662.4 2,033.5  
Metal, fabricated metal products, machinery and equipment  
14,482.2 3,689.6 13,929.4 3,575.0 13,192.8 3,387.8 13,861.4 3,566.0 14,099.0 3,630.6  
Non-metallic mineral products (excl uding petroleum and coal products)  
3,686.9 1,358.5 3,370.2 1,265.0 3,218.0 1,283.9 2,894.0 1,198.7 3,101.1 1,259.6  
 
Source:  WTO Secretariat, based on information pr ovided by the authorities of Jamaica. 
(ii) Incentive schemes and market access 
59. The manufacturing sector benefits from a number of incentive schemes.  Incentives are 
granted under the Export Industry Encouragement Act, Free Zones, Modernization of Industry 
Programme, Accelerated Depreciation Programme and duty-free treatment of inputs for production (Chapter III(2)(viii), (3)(iv) and (4)(ii)).  Qualif ied businesses operating in the manufacturing sector 
may also take accelerated depreciation allowances.   Financing is provided through various facilities 
and programmes at an average interest rate of  12%, while the commercial bank rate is 25% (in 
March 2004) (section (6)(ii) below, Chapter III, sections (3)(v)(b) and (4)(ii)).  The Jamaica 
Productivity Centre, a tripartite organizati on, began operations on 1 April 2003. 
60. Tariff on imports of manufactured products (ISIC definition) averaged 7.7% in 2004, with a 
range of zero to 40%.  Excluding processed food, be verages, and tobacco, on which the highest tariffs 
in the sector apply, the average was 6.1%;  other pr oducts subject to high tariffs are mostly those for 
which there is domestic production, such as clot hing, leather goods, and soap (Table AIV.2). 
61. To protect its cement and chemical industr ies, Jamaica imposed its first anti-dumping 
measure, on imports of ordinary Portland grey cement in 2001.  Anti-dumping duties on inorganic 
fertilizers were introduced in 2002 (see Chapter III(2)(xi )).  Jamaica's first safeguard, on Portland grey 
cement, was imposed as a provisional measure in 2003. 
62. Import licensing is required for some manufactured  products, in particular for motor vehicles 
and parts, arms and ammunition,  certain toys, games, and amusement machines (Chapter III(2)(x)). 
(iii) Textiles and clothing 
63. The most marked change since Jamaica's last Review in 1998 has been in the textile and 
clothing sector.  Production has decreased sharply (in constant dollars), as has value added 
(Table V.8).  Exports, mainly of apparel, have decreased accordingly (see Table IV.9);  imports of 
textiles decreased from US$64.8 million in 1998 to US$46.2 million in 2002, due to the decline in 
production in textile sector;  and imports of cl othing fell from US$217.8 million to 52.8 million.  
Many factories have been closed and employment  dropped from 36,000 persons in the early 1990s to 
approximately 8,000 in 2002.  This contraction h as taken place despite preferential treatment granted 
by various trading partners, and domestic incentive schemes.  In 2003, for the first time in a decade, 
earnings from apparel exports grew, by 2.5%, ma inly due to increased exports to Europe. Jamaica WT/TPR/S/139/Rev.1 
 Page 107 
 
 
64. The policy response to the decline of the textil es and clothing industry has been to guide and 
facilitate the shift to, and development of the hi gher-value-added fashion industry.  The Jamaica 
Business Development Centre (JBDC) and JAMPRO have central roles in this process:  JAMPRO through its marketing and investment promotion ac tivities, and JBDC through its technical assistance 
and business development focus with special emphasis at the SME level.  New competitive strategies 
as outlined in the Modernisation Action Programme  (MAP) put emphasis on developing efficiencies 
at the firm level, through measures such as th e adoption of appropriate  technology, appropriate 
financing, and training.  
Table IV.9  
Apparel exports, 1998-03 
(US$ million) 
Market 1998 1999 2000 2001a 2002 2003b 
United States 410.3 334.1 266.0 191.3 123.2 101.0 
Total 807 353.7 288.1 238.7 68.0 27.2 2.6 
Cut, make and trim (CMT) 56.6 46.0 27.3 15.4 9.4 18.1 
CBTPA n.a. n.a. n.a. 107.9 86.6 80.3 
Others 95.0 91.1 94.5 99.0 106.2 134.2 
Total 505.3 425.2 360.5 290.3 229.4 235.2 
 
n.a. Not applicable. 
 a Revised. b Preliminary. 
 
Note: 807 products are made of fabric cu t (formed or not) in the United States.  CMT products are products for which the cuttin g is 
done in Jamaica and products assembled in  Jamaica from imported pre-cut parts. 
 
Source:  Planning Institute of Jamaica (2002) and (2003), Economic and Social  Survey of Jamaica . 
65. Jamaican textiles benefit from preferentia l treatment under CARICOM, the CARICOM-
Colombia Free Trade Agreement, the Cotonou Agreem ent, the United States-Caribbean Basin Trade 
Partnership Act (CBTPA), and the United States-J amaica and Canada-Jamai ca bilateral textile 
arrangements.  Certification of te xtile products is governed by the Trade (Certificates of Jamaican 
Origin) (Amendment) Regulations, 1998. 
66. The main market for Jamaican textile and clothing exports remains the United States (around 
43% of total exports), despite the increasing importa nce of Europe as an export market.  Jamaican 
exports of certain number of cl othing products have access to the United States under the 807, and 
cut, made and trim (CMT) provisions (through b ilateral quotas), and under the U.S.-Caribbean Basin 
Trade Partnership Act (CBTPA), whic h became effective in October 2000.21  The CBTPA grants 
duty-free and quota-free treatment on apparel made in  a CBI beneficiary country from fabrics formed 
from U.S. yarns;  on certain knit apparel made in CBI beneficiary c ountries from fabrics formed in the 
Caribbean Basin region (provided that U.S. yarns are u sed for the fabric), subject to an overall yearly 
limit (a separate limit is set for T-shirts);  a nd on apparel made in a CBI beneficiary country from 
fabrics determined to be in “short supply” in the United States, and for designated “hand-loomed, 
handmade, or folklore” articles.22  Jamaican exports of textiles a nd clothing to United States have 
been taking place mainly through the CBTPA si nce it came into effect (Table IV.9). 
                                                      
21 Some products, such as hosiery, however were  not granted CBPTA preferences.  See also WTO 
(2004), Chapters II and IV. 
22 Trade Board, "Certification of Textile Products ".  Available at:  http://www.tradeboard.gov.jm/ 
export_cert_07.htm. WT/TPR/S/139/Rev.1 Trade Policy Review 
Page 108 
 
 
67. The Bilateral Textile and Appa rel Agreement with the United States, signed in 1994, sets 
export restraints on a number of textile and clothi ng items.  Quotas are applied on 20 product groups, 
with access levels determined by the United States every year.  These quotas are allocated by 
JAMPRO among eligible exporters, who must be re gistered manufacturers of textiles and clothing 
(including those in free zones, as their exports are considered as part of Jamaican exports for quota 
purposes).  The quotas have been traditionally underfille d, in particular since the CBTPA entered into 
force.  The highest fill rate in 2003 was 8.7% fo r knit shirts and blouses;  the rate was 0% for 
13 product groups and between 0.1 and 2.2 for the ot hers.  The quota system will be terminated under 
the WTO Agreement on Textiles and Clothing (ATC),  which provides for the elimination of all 
bilateral quotas on imports from WTO Members at the latest by January 2005. 
68. Most Jamaican producers of textiles and clothi ng benefiting from access to the U.S. market 
operate in free zones, particularly in the Monteg o Bay Free Zone.  However, these exports decreased 
from US$410.3 million in 1998 to US$31.2 million in 200 2.  The slight increase in exports to other 
markets has not compensated this fall.  The perform ance of the apparel industry has been influenced 
by competition from other textile-and clothing-producing countries, and the migration of some 
manufacturers, particularly those located within fr ee zones.  This migration seems to have been 
provoked by loss of competitiveness due to high opera tional costs, notably electricity, security, and 
wages, as well as the cost of capital. 
(5) ELECTRICITY  
69. Electricity generation increased at a slow pace,  from 2,949.6 MWh in 1998 to 3,696 MWh in 
2003, largely reflecting the slow growth of the economy as a whole.  The Jamaica Public Service 
Company Limited (JPSCo) supplies approximately two-th irds of the total energy generated directly to 
the grid, while independent power producer s supply the balance through power-purchasing 
agreements (Table IV.10).  The authorities not e that 140 MW of capacity was added by JPSCo 
between 2001 and 2003.  Transmission and distri bution losses are significant, and the cost of 
electricity remains high by international standards.  An electricity policy paper is being drafted to 
address these issues. 
70. The electricity industry is, in principle, gove rned by the Electric Lighting Act 1890 (latest 
amendment in 1977);  the Electricity Developmen t Act 1958; and Office of Utilities Regulations Act 
1995 .  A new legislative framework is being prepared.  According to the authorities, the two sectoral 
Acts do not reflect current technology and industry ma rket structure, and the sector is, in practice, 
regulated by the licence granted to JPSCo (see belo w) while awaiting adoption of new legislation.  
The authorities responsible for regulating the sector  are the Ministry of Commerce, Science and 
Technology and the Office of Utilities Regulation (OUR). 
71. The JPSCo remains the main supplier and sole distributor of electricity in Jamaica.  It 
operated under an exclusive 39-year licence issued  in 1978.  In 2001, a new 20-year licence was 
issued to JPSCo, granting it the right to generate, and the exclusive right to transmit, distribute, and 
supply electricity throughout Jamaica.  The JPSCo has an obligation to connect to private suppliers, 
unless they compromise the safety of the transmission and distribution network.  The company is owned jointly by Mirant (United States), the Gove rnment of Jamaica, and a small group of minority 
shareholders;  80% of ownership of the company w as sold to Mirant in March 2001.  The JPSCo is 
subject to regulation by the OUR. 
72. Total electricity output was 3.52 billion kilo watt hours in 2002;  generation by non-JPSCo 
sources was 1.1 billion kWh.  The share of electric ity generated by independent providers has been 
increasing, from 24.5% in 1998 to 30.3%  in 2002.   About 82.2% of total output is sold to final users;  Jamaica WT/TPR/S/139/Rev.1 
 Page 109 
 
 
the rest is lost or used by the generators themsel ves.  Around one third of the generated electricity is 
sold to households (Table IV.10). 
Table IV.10 
Output and distribution of electricity, 1998-03 
(MWh) 
 1998 1999 2000 2001 2002 2003a 
Net output 2,227.6 2,257.1 2,295.4 2,450.8 2,458.0 2,673.6 
  Steam 1,815.8 1,736.1 1,670.6 1,601.6 1,717.0 1,685.0 
  Slow speed diesel 225.4 242 259.1 257.5 214.1 200.3 
  Hydro 87.8 88.8 78.4 60.5 104.6 146.3 
  Gas turbine 98.6 190.2 287.2 531.2 422.3 641.9 
Non-JPSCo sources 722.0 842.4 1,006.5 910.0 1,066.9 1,022.4 
Total output 2,949.6 3,099.5 3,301.8 3,360.8 3,524.9 3,696.0 
D i s p o s a l        
  Residential rate sales 926.3 1,007.4 1,046.8 1,065.4 1,103.1 1,106.7 
  General service rate  589.1 606 598.3 604.8 618.1 652.4 
  Power service rate 517.1 520.6 573.5 583.3 597.2 625.7 
  Large power rate 358.8 383.6 463.8 474 510.4 540.6 
  Street lighting rate 50.2 51.1 51.4 55.6 57.4 59.9 
  Other 4.7 7.4 5.1 10.2 10.3 13.1 
JPSC use 11 10.9 10.3 10.1 9.7 12.4 
Line losses and other 
unaccounted for net generation 503.4 523.3 562.8 567.4 618.6 685.3 
 
a Provisional. 
 
Source : Planning Institute of Ja maica (2002) and (2003), Economic and Social Survey of Jamaica . 
73. Electricity tariffs supplied are determined by JPSCo and must be approved by  the OUR  (see 
Chapter III(4)(i)).23  According to the JPSCo's licence, the rat es must be cost-reflective, and consist of 
a non-fuel rate, adjusted annually to incorporate a performance-based rate-mak ing mechanism;  and a 
fuel rate, adjusted monthly to reflect fluctuations in fuel costs.  There is also provision for annual 
adjustments to be made as a c onsequence of any extraordinary co sts related to government-imposed 
obligations.  The non-fuel rate component is ad justed monthly to account for movements in the 
exchange rate between the US$ and the J$, while fuel costs are passed th rough directly as a fuel 
charge on customers bills.  Different rates are set (depending on the demand) for residential services, 
general services, power services (low and medium voltage), street lighting, and traffic signals.  The 
highest rate in 2003 was for streetlights (J$10.663 pe r kWh) and the lowest for large power and to 
other generating companies (J$6.537 per kWh);  the ra te for residential services is J$10.616 per kWh.  
There are no concessionary rates for specific activiti es;  companies can, however, negotiate prices.  
The terms of the JPSCo licence require a review of  tariffs and the introduction of a new price cap 
regime in June 2004. 
74. The issues of renewable energy has been give n serious attention by the Government, and in 
July 2004, the first commercial wind farm was co mmissioned.  The farm has 23 turbines and an 
installed capacity of 20.7 MW.  The energy pro duced by the farm will be sold to JPSCo for 
distribution through the national grid and is expected to service more than 25,000 households. 
                                                      
23 OUR (2003). WT/TPR/S/139/Rev.1 Trade Policy Review 
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(6) SERVICES  
(i) Overview 
75. The services sector in Jamaica accounted for some 71.9% of GDP in 2003 and employed 
around three quarters of the labour force.  The size of its tourism industry makes Jamaica an important 
exporter of services.  The process of privatizati on and liberalization, reported in Jamaica's last 
Review, in 1998 has continued in the services sector.  There is currently little government 
involvement in tourism, telecommunications, and fi nancial services.  Market access is relatively open 
in most subsectors.  Since 1998, major developments include the liberalization of the telecommunications subsector and mergers and recapitalization of financial institutions. 
76. Under the General Agreement on Trade in Se rvices (GATS), Jamaica scheduled horizontal 
commitments on commercial presence and the presence of natural persons for all sectors included in its Schedule (Table AIV.3).  Jamaica particip ated in the extended negotiations on basic 
telecommunications and financial services, and present ed offers in both negotiations.  In its Schedule 
of Specific Commitments Jamaica maintains no market  access restrictions with respect to commercial 
presence as total foreign ownership is allowed in a ll sectors with the exception of the preference for 
joint ventureships in certain professional services.  Insurance, where foreign ownership was limited, 
was liberalized in the WT O Negotiations on Financial Services.  However, as of June 2004, Jamaica 
had not yet ratified the Fifth Protocol to the GATS.
24 
(ii) Financial services 
77. The performance of the financial services subs ector has strengthened since 1998 and value 
added has expanded faster than overall GDP.  The su bsector accounted for 8.5% of GDP in 2003, up 
from 8% in 1998 (Table IV.11).  Approximately 57, 600 persons were employed in financial services 
in 2002.  The subsector is rela tively well developed and liberalized , and seems to have overcome the 
effects of the crisis that affected it during the 1990s , as reflected in an improvement in indicators (see 
below).  Also, mergers and acquisitions have cons olidated the financial services market, and the 
quality of the investment portfolio has improved. 
78. Liberalization and reform have led to a substantial improvement  in prudential indicators but 
the performance in the financial subsector could be  further enhanced.  For example, as in other 
countries of the region, the spread between lending and deposit interest rates continues to be high, 
suggesting the need to increase efficiency in financ ial intermediation and lower the risk perception.  
The authorities have noted that high administrative co sts are behind the large spreads.  In March 2004, 
the average lending rate of commercial banks was 25. 4% (some 10% in real terms), while the average 
deposit rate was 8.3%, resulting in a spread of 17 .1 percentage points.  This, however, compares 
favourably with the situation in late 1998, when the spread reached almost 27%.  In this respect the 
consolidation of banking activities in recent years and the adoption of more stringent prudential 
regulations are positive steps to reduce risk.  The intermediation activities of securities market dealers 
represented roughly 42% of the financial subsector's  assets in 2002.  The IMF has noted that these 
activities could make the financial sector potentiall y vulnerable, since minimum capital requirements 
are low, and their portfolios are subject to interest rate and exchange rate risks.25  The authorities have 
noted that, to overcome concerns of this type, ne w regulatory guidelines based on Basel I are expected 
to become effective in 2004, calling for higher mini mum capital requirements (10% of risk-weighted 
assets), and margin requirements ranging from 1%-30%  on repurchase transactions.  The authorities 
consider that the new guidelines will provide a clear definition of eligible securities to be used in 
                                                      
24 WTO document GATS/EL/45, 15 April 1994. 
25 IMF (2004b). Jamaica WT/TPR/S/139/Rev.1 
 Page 111 
 
 
repurchase agreements, and that they will mitigate the credit and market risks of the securities dealers' 
portfolios. 
Table IV.11 
Financial sector:  selected indicators, 1997-03  
Indicator 1997 1998 1999 2000 2001 2002 2003 
Contribution to GDP 8.3 8.0 8.5 8.7 7.9 8.2 8.5 
Real GDP growth -10.6 -4.2 7.0 3.1 -8.1 6.1 4.9 
Employment ('000) 59.6 56.8 52.5 50.8 47.3 57.6 64.4 
Total assets (J$ million) 196,031 221,178 238,919 267,905 300,736 340,488 398,788a 
Total deposits (J$ million) 147,118 154,396 164,601 188,829 204,908 230,585 250,129a 
Total loans (J$ million) 73,534 52,412 48,809 52,202 69,587 97,549 90,560a 
Capital base 4,971 9,096 21,662 24,333 27,416 29,815 33,572a 
 
a As at September 2003. 
 
Source: Planning Institute of Jamaica (2002) and (2003), Economic and Social Survey of Jamaica . 
79. In the mid 1990s, the financial crisis prompt ed the intervention of the Government of 
Jamaica, which led to the enhancement of regula tion and the creation of the Financial Institutions 
Services, Ltd (FIS) and the Financial Sector Adjustment Company (FINSAC).  The FINSAC provided support to help address liquidity and solvency pr oblems faced by troubled financial institutions;  it 
provided debt and equity capital of over US$1.5 billi on.  At the same time, legislative amendments 
were made to improve the regulati on and supervision of the financial sector.  The FINSAC is in the 
process of winding down its operations as it completes the divestment phase of its mandated three-phase programme.  In February 2002, the Jamaica Redevelopment Foundation, a subsidiary of a 
U.S.-based bank, purchased FINSAC's non-performing loan portfolio, valued at US$393 million.  The authorities note that the FINSAC's mandate has been  largely achieved in the stipulated seven-year 
timeframe, and, with the exception of legal issues, all day-to-day residual matters are being managed 
by the Financial Institutions Services. 
80. New legislation introduced between 1998 and 2003, created institutions and procedures to 
strengthen the oversight of financial institutions and provide greater cons umer protection.  New 
prudential requirements were set, increasing th e power of supervisory authorities and making 
provisions for depositors in case of financial institu tion failure.  Financial services regulations were 
modified through the introduction of amendments to the Bank of Jamaica Act and the Building 
Societies Act in 2002, and the Financial Institutions Act in 2001;  an overhaul of the Insurance Act in 
2001, and of the Securities Act and the Unit Trus t Act in 2000;  and the passage of the Deposit 
Insurance Act in 1998 and of the Financial Servi ces Commission Act in 2001.  The Securities (Mutual 
Funds) Regulation, 1999, and the Securities (Take overs and Mergers) Regul ations, 1999 were also 
introduced during this period. 
81. Through the new legislation, there has been some shift in authority away from the Minister of 
Finance to the new agencies related to particular financial services, such as insurance and securities 
trading.  The Financial Instituti ons Supervisory Division (FISD) of  the Bank of Jamaica (BOJ, see 
also Chapter I) has supervisory responsibility ove r deposit-taking financial institutions, including:  
commercial banks licensed under the Banking Act;  merchant banks;  trust and finance houses 
licensed under the Financial Institutions Act (FIA licensees);  building societies licensed under the 
Bank of Jamaica (Building Societies) Regulati ons;  credit unions licensed under the Cooperative 
Societies Act;  and other specified financial in stitutions.  Since 2001, the BOJ may intervene and 
assume temporary management of institutions unable to meet their obligations, a function formerly held by the Ministry of Finance.  The 2002 Ame ndment of Section 34F of the Bank of Jamaica Act WT/TPR/S/139/Rev.1 Trade Policy Review 
Page 112 
 
 
increases the power of the Minister of Finance, on recommendation from the BOJ, to introduce 
regulations on the prudential require ments of financial institutions, a nd allows for penalties of up to 
J$2 million or two years imprisonment for non-compliance. 
82. The Financial Services Commission (FSC), created by the Financial Services Commission 
Act of 2001 (Act No. 9 of 2 August 2001), supervi ses and regulates prescribed financial institutions.  
Currently, this extends to the insu rance and securities industries with pension funds expected to come 
on-stream, after approval of the relevant legisl ation.  The FSC is governed by a Board of 
Commissioners, appointed by the Minister of Fina nce, and is funded by licence fees.  Under the 
Financial Services Commission Act, no person who has proprietary interest in more than 5% of the 
shares of a prescribed financial institution may be appointed as a member of the Commission. 
83. The Jamaica Deposit Insurance Corporation (J DIC) was established on 31 August 1998, to 
insure foreign and domestic depositors against th e loss of deposits made in commercial banks, 
merchant banks, trust companies, and building soci eties.  Coverage is for a maximum of J$300,000 
per depositor, per institution.  The JDIC also ma nages the Deposit Insurance Fund.  All institutions 
that take deposits in Jamaica and are supervised by the Bank of Jamaica must register with the JDIC 
and make annual contributions in the form of prem iums to the Fund.  At the end of March 2004, 
16 institutions were registered with the JDIC and the balance of the Fund was J$1.2 billion.  
Approximately 97% of deposit accounts or 40% of the value of deposits  are insured.  The JDIC works 
closely with the BOJ, relying on the information of the Bank regarding the financial status of insured 
institutions.  Consultation with the Minister of Fina nce and the BOJ is required in decisions regarding 
the determination of institutional fa ilure and methods of resolution. 
84. The Regulatory Policy Council (RPC), established in 2000, is an inter-regulatory body 
responsible for facilitating coordination and informat ion sharing between the agencies that supervise 
the Jamaican financial sector.  The RPC develops policies and strategies towards this end.  The 
March 2001 amendment to the BOJ Act allowed the Ba nk of Jamaica to share information with the 
FSC and the JDIC within the framework of the RPC. 
85. The annual licence fee for deposit-taking fina ncial institutions, of J$2,000 for every 
J$10 million of assets of the company or part thereof, is payable to the Accountant General, it is applicable equally to companies incor porated in, and outside of, Jamaica. 
86. Jamaica made commitments on financial services in both the Uruguay Round and the 
extended negotiations that led to the Fifth Protocol.
26  In its GATS Schedule of Specific Commitments 
with respect to banking and othe r financial services, Jamaica listed as unbound the acceptance of all 
types of deposits and other repayable funds from the public, as well as lending of all types, including 
consumer credit, mortgage credit, factoring and fina ncing of commercial transactions, for all modes of 
supply, with the exception of commercial presence.  There are no market access or national treatment 
restrictions for the provision of banking services through commercial presence, except that foreign 
banks are subject to higher capital requirements than  local banks, as specified in Jamaica's Schedule.27  
Jamaica made national treatment commitments in both life and non-life insurance during the Uruguay 
Round negotiations.28  These commitments were enhanced in the negotiations on financial services.  
However, as at June 2004, Jamaica had not ratified the GATS Fifth Protocol.29  The authorities noted 
in this respect, that they were expecting to have  all the regulatory framework in place before ratifying 
the Protocol. 
                                                      
26 WTO documents GATS/SC/45 of 15 April 1994 and GATS/SC/45/Suppl.2 of 26 February 1998. 
27 WTO document GATS/SC/45/Suppl.2, 26 February 1998. 
28 GATS/SC/25, 15 April 1994. 
29 WTO document S/FIN/M/44, 21 April 2004. Jamaica WT/TPR/S/139/Rev.1 
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87. There are no restrictions to private foreign ow nership of banks, and the banking, life, non-life 
insurance sectors benefit from national treatment.  The establishment of financial institutions requires 
prior authorization based on prudential and other "fit  and proper criteria" as defined in the legislation 
regulating the particular type of activity. 
88. At the regional level, CARICOM is undertaking a comparative analysis of member states' 
national legislation on financial services as a st ep towards regional harmonization in banking and 
securities. 
(a) Banking 
89. As of early 2004, the Jamaican banking subsect or consisted of six commercial banks, six 
merchant banks, one trust and finance company, four  building societies, and five development banks.  
Concentration in banking is relatively high and has increased during the period under review.  
Mergers and acquisitions reduced the number of co mmercial banks in Jamaica from nine in 1998 to 
six in 2004.  Currently, all banks are either foreign- owned or have foreign ca pital participation, in 
contrast with just three in 1998. 
90. Commercial banks' assets increased steadily over the 1998-03 period,  to J$313.5 billion 
(US$5.38 billion at the 2003 average exchange ra te) from J$173.6 billion (US$4.7 billion at the 1998 
average exchange rate).  Deposits increased from J $114.1 billion (US$3.1 billion) to J$198.8 billion 
(US$3.4 billion).  Loans and advances by commerc ial banks increased by a third during the same 
period;  they were disbursed primarily for consump tion, in particular for personal use, followed by 
government services, and tourism and entertainmen t;  the share of credit for agriculture and 
manufacturing has been declining since 1998 (Table IV.12). 
Table IV.12 
Distribution of commercial bank loans and advances, 1998-02 
(% of total loans and advances) 
 1998 1999 2000 2001 2002 
Consumption 39.7 42.5 38.7 35.5 28.8 
  Personal 24.6 30.7 26.9 28.2 23.2 
  Professional services 15.1 12.3 11.7 7.2 5.7 
Goods-producing activities 20.2 18.3 16.5 14.3 11.2 
  Agriculture 4.7 4.1 3.9 3.1 2.3 
  Manufacturing 9.3 8.2 7.7 6.2 4.3 
  Mining 0.4 0.3 0.3 0.2 0.1 
  Construction 5.8 5.4 4.5 4.9 4.5 
Services 40.1 38.7 44.8 50.2 59.9 
  Government services 10.9 13.3 16.5 21.0 31.2 
  Tourism and entertainment 10.2 10.1 12.0 10.7 9.8 
  Distributive trade 8.3 7.7 8.8 6.6 6.1 
  Other services 19.7 7.6 7.5 20.9 15.3 
 
Source: Bank of Jamaica.  WT/TPR/S/139/Rev.1 Trade Policy Review 
Page 114 
 
 
91. The prudential indicators of the banking system have improved in recent years.  For example, 
past due loans as a percentage of total loans decreased each year between 1998 and 2003, from 29.6% 
to 3.3% (Table IV.13).30 
92. Commercial banks are regulated by the Ba nking Act 1992 and the Banking (Amendment) 
Act, 1997.  Licensing requirements are the same fo r foreign-owned and dom estic banks, with the 
exception of minimum subscribed capital requirement s, which are higher for foreign banks.  Foreign 
banks may establish both branches and subsidiaries.  The same capital-fixed-asset and credit-limit exposures apply to foreign and domestic-owned banks.  No distinction is made between domestic and 
foreign banks with respect to the services they can provide. 
Table IV.13 
Key prudential indicators of commercial banks, 1998-03 
(%, unless otherwise indicated) 
 1998 1999 2000 2001 2002 2003 
Institutions in operation 9 6 6 6 6 6 
Overall structure        
Total loans (net of provisioning, J$) 37,210 32,174 33,631 38,355 63,169 87,241 
Past due loans/total loans 29.6 16.9 14.3 8.8 4.2 3.3 
Rate of asset  growth 11.2 22.1 11.3 12.7 8.2 18.5 
Rate of deposit growth 8.8 15.1 15.5 8.1 9 9.4 
Rate of loans growth (gross) -18.5 -19.8 8.5 9.1 56 36.1 
Rate of capital base growth -73.6 973.8 8.2 19.6 9.4 16.6 
Investments/total assets 33.3 44.1 48.3 48.0 41.0 36.2 
Fixed assets/total assets 2.9 2.4 2.3 1.9 2.3 2.2 
Loans (net of prov.)/total assets 24.2 17.1 16.1 16.2 24.7 28.8 
Loans (gross):  deposits 39.9 27.8 26.1 26.4 37.7 46.9 
Liquidity       
Cash reserves/prescribed lia bilities 23 16.8 13. 0 10.0 9.0 9.0 
Liquid assets/prescribed liab ilities 51.7 49.4 49. 5 43.5 41.0 33.7 
Asset quality       
Loan loss reserves/total loans (gross) 17.8 11.4 14.6 10.8 5.8 4.4 
Capital adequacy       
Deposits + borrowings:  capital (:1) 100.5 10.4 10.9 10.1 10.1 10.2 
Capital base/total assets 0.9 8.1 7.8 8.3 8.4 8.3 
Profitability       
Pre-tax profit margin (for quarter) -0.3 12 22.2 9.3 29.5 30.3 
Return on average assets (for quarter) 0.0 0.5 0.9 1.0 1.0 1.4 
 
Source : Bank of Jamaica. 
93. Banks must create reserves from profits:  they are required to transfer each year a minimum 
of 15% of net profits to a statutory reserve fund un til its balance reaches 50% of the paid-up capital.  
Subsequently, a minimum of 10% must be transfe rred each year until the reserve fund covers paid-up 
capital.  Banks may not, directly or indirectly, acquire or hold more than 50% of the share capital of any company or undertaking.  Banks must establis h reserves to cover loans on which no payment of 
principal or interest has been made for a period of  three months;  they must notify the BOJ of any 
loans that fall in this category and that represent 10%  or more of their capital base.  Where a bank has 
                                                     
 
30 Bank of Jamaica (2004b). Jamaica WT/TPR/S/139/Rev.1 
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a subsidiary or subsidiaries, a consolidated bala nce sheet and consolidated profit and loss account 
relating to the licensee and its subsidiaries must be presented. 
94. Reserve requirements are determined by the BOJ, based on BOJ Act guidelines, which 
prescribe that banks and other financial institutions  must maintain a cash reserve of not less, on 
average, than 5% of its prescribed liabilities, in th e form of a deposit with the BOJ;  their liquid assets 
must be, on average, not less than 15% of their prescribed liabilities.  Reserve requirements, were 
reduced during 1998-03 as the financial situation of  the banks improved.  The liquid assets reserve 
requirement (share of deposit liabilities on assets)  for commercial banks was reduced annually, from 
47% in 1998 to 27% in 2003.31  The cash reserve requirement has al so been reduced by the BOJ, in a 
series of gradual reductions, from a level of 25% in 1998 to 9% in March 2002.32  Commercial banks 
met statutory requirements in liquid assets and cash  reserves in 1998 and 1999, fell slightly below the 
margin during the second half of 2000 and 2001, and in 2002 met the requirements for the entire year. 
95. Requirements for FIA licensees and for banks have  been the same since 1999;  and penalties 
for failure to meet the requirements have been th e same since late 2002.  FIA licensees did not meet 
statutory requirements in either cash or liquid asset reserves in 1998 and 1999, but met both for the 
period 2000-03.  Commercial banks and FIA licensees are subject to a special deposit ratio with the 
BOJ of 5%, as of January 2003, which the BOJ may increase to a maximum of 20% of the prescribed 
liabilities with approval from the Minister of Finance. 
96. Minimum capital requirements are applied e qually to national and foreign-owned banks, 
except for subscribed capital, which is J$250 milli on for foreign-owned bank s and J$80 million for 
national banks.  The authorities note that the a dditional capital requirements for foreign banks are 
intended to ensure that there is a buffer against ri sks arising from the foreign banks' operations outside 
of Jamaica.  For FIA licensees and building societies, the required s ubscribed capital is J$25 million, 
regardless of ownership.  Paid-up capital requi rements are J$60 million for commercial banks and 
J$20 million for FIA licensees and building societies.   Revised capital adequacy regulations embodied 
in the Banking (Capital Adequacy) Regulations we re gazetted on 8 March 2004.  They introduce and 
formalize a 10% risk weighted capital adequacy ra tio as well as a 6% primary ratio (capital base to 
total assets);  the authorities note that the higher ratio s were already adhered to prior to the gazetting 
of the Regulations.  The capital adequacy ratio  is 25:1 for commercial banks and 20:1 for FIA 
licensees. 
97. The Financial Institutions Act, 2001, as amended in 2002, regulates merchant banks, trust 
companies, and finance houses, which are commonl y called FIA licensees.  Licences are granted by 
the Minister of Finance on the recommendation of the BOJ.  There are no limitations on private 
foreign investment;  however, except with the written approval of the Minister of Finance, a foreign 
government or government agency may not, directly or indirectly hold more than 5% of the issued share capital of a licensee, or exercise any voting power in excess of that percentage. 
98. Under the Financial Institutions Act, every li censee must maintain a reserve fund and transfer 
profits to this fund annually, at the same percen tages as banks.  The Act limits deposit liabilities and 
other indebtedness for licensees (together with interest accrued) to a maximum of 20 times its capital base.  FIA licensees may not grant unsecured credit fac ilities to a firm or corporation that holds 20% 
or more of the licensee's capital or in which th e licensee or a connected person has an interest as a 
partner, nor to any person who holds  or controls 20% or more of the licensee's shares.  FIA licensees 
may be allowed to operate as authorized dealers,  which may lend and borrow in foreign currency, as 
well as trade foreign currency instruments.  Not all FIA licensees are allowed to operate as authorized 
                                                     
 
31 IMF (2003), Table 21. 
32 Bank of Jamaica (2002). WT/TPR/S/139/Rev.1 Trade Policy Review 
Page 116 
 
 
dealers.  At the end of 2003, there were 11 aut horized dealers, consisting of six commercial banks, 
three FIA licensees, and two building societies. 
99. As a result of mergers and acquisitions, th e number of FIA licensees decreased from 21 in 
1998 to seven in 2003.  Assets, excluding conti ngent liabilities, fell from J$16.1 billion to 
J$8.8 billion,  between Septembe r 1998 and 2000, reflecting the financ ial crisis, but rebounded for the 
period up to September 2003, to reach J$35.6 billion (US$611 million).  Deposits increased from 
J$5.9 billion to J$8.7 billion over the September 1998-03 period;  prudential indicators, such as the rate of past due loans over total loans, as well as profitability, improved during the period. 
100. Cambios  and bureaux de change  are only authorized to buy and sell foreign currency;  they 
are licensed and supervised by the BOJ.  Comp liance with the Money Laundering Act, 1999 is 
assessed through on-site inspection and in-house monito ring.  In early 2004, there were 136 licensed 
cambio locations operated by 66 entities.
33  Only local companies are e ligible for licences to operate 
as cambios ;  licences are renewable annually and not tr ansferable.  Prospective directors, and 
shareholders of 10% or more of a cambio  are evaluated based on "fit a nd proper" criteria, audited 
financial statements for the two years prior to applic ation, and proof of availability of cash of at least 
US$25,000.  Cambios  must sell a minimum of 5%, and as much as 10%, of their daily gross foreign 
exchange purchases to the BOJ at their prev ious day's weighted average selling rate cambio  or lower.  
Cambios  cannot hold a short foreign currency position. 
101. Building societies mobilize and allocate savings by providing long-term mortgage financing, 
of up to 90% of the value of a property, mainly  for residential purposes.  Building societies are 
regulated by the Building Societies Act 1897, as amended in 1995 and 2002, the Bank of Jamaica 
(Building Societies) Regulations 1995, and the Bu ilding Societies (Licences) Regulations 1995.  The 
2002 Amendment of the Building Societies Act ga ve the BOJ enhanced supervisory powers, 
including the right to request information related to company operations and customer accounts, and 
to mandate the restructuring of a building society if it is part of a group that has at least one member not supervised by the BOJ or the FSC.  The BOJ may exempt foreign holding companies from these 
requirements, if satisfied that regulatory criteria in the foreign country of incorporation are stringent 
enough.  Cash requirements for building societies ar e lower than for other financial institutions, and 
vary according to the perceived solvency of the soci ety, linked to the amount of total loans granted for 
residential mortgage purposes.  During the period under review, the number of building societies in 
operation fell from ten to four, partly due to mergers assisted by the FINSAC.  For the period 
September 1998-03, assets, excluding contingent  liabilities, increased from J$44.3 billion to 
J$60.6 billion, while total deposits increased from J$33. 3 billion to J$46.8 billion;  both, however, 
contracted in terms of U.S. dollars. 
102. Credit unions are deposit-taking institutions that  are owned by and only conduct business with 
their members;  they typically offer short-term lo ans at lower interest rates than other financial 
institutions.  Credit unions are required to hold a reserve account with a minimum of 20% of their 
surplus in case of bad debts and future losses.  Cred it unions were designated as "specified financial 
institutions" under the Bank of Jamaica Act in 1999 and now fall under BOJ supervision.
34  T h e  
Jamaica Co-operative Credit Union League Ltd is a local association of credit unions that also has a regulatory role;  it conducts regular audits of credit unions and sets codes of ethics for business 
practice and financial guidelines.
35  At end 2002 there were 56 credit unions in operation, down from 
                                                      
33 Bank of Jamaica, (2004c). 
34 The Bank of Jamaica Declaration of Specified Fina ncial Institutions (Cooperative Societies) Notice, 
1999, and Bank of Jamaica (2000). 
35 Jamaica Co-operative Credit Union League Limited online information.  Available at:  
http://www.jccul.com/. Jamaica WT/TPR/S/139/Rev.1 
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77 in 1998;  membership was over 680,000, up from th e 1998 figure of 500,000.  Assets in December 
2002 were J$20 billion (US$410 million);  savings we re some J$15 billion;  and outstanding loans 
were J$10 billion.  The authorities note that Bank of Jamaica (Credit Union) Regulations are being 
drafted (as at June 2004), to prescribe the prudential criteria and minimum solvency standards for 
credit unions. 
103. In 2002, Jamaica's five development banks di sbursed a total of J$3.4 billion in domestic 
currency and US$15.1 million in foreign currency (Table IV.14);  the manufacturing sector received the most funds (J$2.4 billion), followed by ser vices (J$382.2 million), tourism (J$357.9 million), and 
agriculture (J$252.7 million).
36 
104. The Development Bank of Jamaica (DBJ), owne d by the Government, is the result of the 
merger of the National Development Bank and the Agricultural Credit Bank in 2000.  It provides 
medium- and long-term loans for productive activ ities;  the loans are channelled through approved 
financial institutions, including commercial an d merchant banks, cred it unions, and people's 
cooperative banks.  DBJ's assets and liabilities reached J$21.8 billion in 2002, an 80.5% increase over 
the previous year.  Funds were obtained from over sees financial institutions and the 2002 issue of a 
development bond.  Loans were disbursed mainly  for tourism, agriculture, and manufacturing. 
Table IV.14 
Loans disbursements by development banks, 1998-02 
(J$ and US$) 
 1998 1999 2000 2001 2002 
Local currency loans (J$ million)  2,561.9 2,911.2 2, 842.2 3,881.2 3,429 
Pan Caribbean Financial Services Ltd 176.2 176.9 93.6 56.2 39.5 
National Development Bank 243.9 223.5 n.a. n.a. n.a. 
EX-IM Bank 1,627.9 1,994.5 1,881.1 2,045.1 2,143.0 
Agricultural Credit Bank 312.5 350.9 n.a. n.a. n.a. 
National Development Foundation of 
Jamaica 71.3 58.2 86.7 106.7 8.3 
National Investment Bank of Jamaica 130.1 107.2 55.0 347.2 70.8 
Development Bank of Jamaica n.a. n.a. 725.8 1,326.0 1,167.4 
Foreign currency loans (US$) 38.9 26.3 17.3 12.3 15.1 
Pan Caribbean Financial Services Ltd 0.0 0.0 0.0 0.4 0.0 
National Development Bank 11.8 9.2 0 0.0 0.0 
EX-IM Bank 17.9 13.9 15.3 8.2 11.8 
Agricultural Credit Bank 0.6 0.1 n.a. n.a. n.a. 
National Investment Bank of Jamaica 8.6 3.1 0.3 2.4 1.9 
Development Bank of Jamaica n.a. n.a. 1.7 1.3 1.4 
 
n.a. Not applicable.  
Source: Planning Institute of Jamaica. 
105. The National Investment Bank of Jamaica (NIB J), owned by the Government, manages the 
equity and quasi-equity investments of the Governme nt's Capital Development Fund.  Investments in 
the tourism sector constitute the greater part of its portfolio.  The Export-Import Bank of Jamaica 
Limited (EX-IM Bank) supports exporters and im porters (see Chapter III(3)(v)(b)).  The National 
Development Foundation of Jamaica provides loans and technical assistance to small and micro-
enterprises.  In 2002, Trafalgar Development Bank was purchased by Grace Kennedy and transformed into the Pan Caribbean Financial Services (PCFS) Limited. 
                                                     
 
36 Planning Institute of Jamaica (2002). WT/TPR/S/139/Rev.1 Trade Policy Review 
Page 118 
 
 
(b) Insurance 
106. The Jamaican insurance industry is regulated by the Insurance Act 2001 (Act No. 26 of 2001), 
Insurance Regulations 2001, the In surance (Actuaries) (Life Insurance Companies) Regulations 2001, 
and the Insurance (Actuaries) (General Insura nce Companies) Regulations 2002, which cover 
registration and licensing, corporate governance, inte rnal controls, and solvency requirements.  This 
legislation repealed the previous Insurance Act, and introduced more stringent regulatory provisions 
(see below).  Jamaica is a member of the Interna tional Association of Insurance Supervisors (IAIS), 
and the Caribbean Association of Insurance regulat ors, which set guidelines for best practices in the 
insurance industry. 
107. There were 20 insurance comp anies in Jamaica in 2003;  13 were general insurance 
companies with combined assets of J$27 billion, more than double the 1998 figure, and reported net 
profits of J$1.8 billion, more than three times th ose of 1998 in real terms.  Automobile and fire 
insurance are the dominant segments.  There are se ven life insurance companies in operation.  The 
number of life insurance policies sold in crease from 41,929 in 1998 to 64,753 in 2003.37  Annualized 
premium income reached J$8.3 billion in 2003.  Cons olidation in the market has reportedly resulted in 
improved efficiency.38 
108. The Financial Services Commission (FSC), is responsible since 2001 for overseeing the 
insurance industry.  The FSC replaced the Superinten dent of Insurance in these functions.  The FSC's 
Insurance Committee is responsible for most matters requiring regulatory approval under the 
Insurance Act.  Insuran ce companies must submit information to the FSC about their directors and 
senior officers;  the FSC must determine whether these persons are "fit and proper".  Foreign 
companies are allowed to participate in all forms of insurance activities. 
109. The Insurance Act 2001 introduced a number of changes, including:  a "fit and proper" 
standard;  an increase of minimum capital requireme nts;  registration requirements for entities that 
were not previously required to register, such as, insurance consultants, ma naging general agents, and 
loss adjusters;  the obligation to appoint an act uary;  and clearer capital adequacy and solvency 
standards.  As a result, life insurance companie s are now required to meet the minimum continuing 
capital and surplus requirement (MCCSR) solvency st andard, which sets out the minimum capital that 
a life insurer must maintain in order to remain in business and is proportional to the size and relative 
risk of the company's business.  General insura nce companies are required to apply the minimum 
asset test (MAT) solvency standard, which also esta blishes the minimum capital to be maintained, but 
based on the size of the business and its liabilities to its policy holders.39  The minimum standard in 
2003 for life insurance companies was for actual cap ital to be at least 100% of the required capital 
under the MCCSR.  Minimum capital requirements are J$150 million for life insurance companies, 
and J$90 million for non-life insurance companies.  Foreign insurance companies are required to meet 
the same minimum capital requirements as the local  companies.  The FSC considers that the new 
provisions make it difficult for under-capitalized comp anies to stay in business, as the FSC has been 
granted the powers, in accordance w ith the Financial Services Commission Act, 2001, to intervene to 
protect policy holders.40 
                                                      
37 Planning Institute of Jamaica (2003). 
38 Jamaica Stock Exchange Online News, 15 March 2004.  Available at:  http://www.jamstockex.com/ 
company/loj/2004/lojfoh04.htm. 
39 Both tests are applied comparing actual assets with their respective benchmarks;  for the period 2001, 
the MAT/MCCSR was set at 100%;  for 2004-2005 it is 110%;  for 2006-2007, 120%;  for 2008-2009, 135%;  
and as of 2010, 150%. 
40 Financial Services Commission (2003). Jamaica WT/TPR/S/139/Rev.1 
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110. Insurance companies may not engage in both long-term and general insurance operations, 
unless general insurance operations are limited to the personal accident insurance business. 
111. The insurance industry has a tiered structure of quarterly renewal fees based on total assets as 
reported in the audited financial statements of the previous year.  The percentages differ for life and 
general insurance companies  The minimum fee is J$1 million annually. 
112. Foreign-owned companies must be established in  Jamaica.  All forms of insurance activities 
are open to foreign suppliers, and foreign i nvestment up to 100% is permitted since 1997. 
(c) Securities trading 
113. Securities trading is regulated by the Securities Act, 1993, as amended in 1996, 1999, and 
2001.  The Financial Services Commission (FSC) w as established under the Financial Services 
Commission Act 2001.  The FSC is in charge of en suring that appropriate standards of performance, 
security, and business practices are maintained, and of granting the licences required to operate in the 
Stock Exchange and the Jamaica Central Securitie s Depository (JCSD).  The FSC may investigate 
suspected fraudulent activity independently or at the request of the Council of the Stock Exchange or 
the Board of the JCSD. 
114. The Unit Trust Act 1971, as amended in 2001, regulates collective inv estment schemes, and 
trusts, and contains provisions for the registration of  unit trust schemes and sa les persons, as well as 
requirements for record-keeping, audits, a nd disclosure of information to investors.41  Unit trusts were 
brought under the supervision of the FSC with the 2001 amendment of the Securities Act and the 
2001 amendment of the Unit Trusts Act.  The FS C also regulates mutual funds, and managers of 
mutual funds must register as licensed dealers. 
115. Several new securities regulations have been intr oduced since Jamaica's last Review in 1998.  
The Securities (Licensing and Registration) (Ame ndment) Regulations 2001 cover the licensing of 
dealers, investment advisors, and representatives.  The Securities (Disclosure of Interest) Regulations 1999, define disclosure of information requirements for public companies and entities that issue commercial paper.  The Securities Act (Mutua l Funds) Regulations 19 99, require collective 
investment schemes other than unit trusts, pension funds, and certain insurance funds, to register as 
mutual funds. 
116. The only stock exchange currently in operation in Jamaica is the Jamaica Stock Exchange 
(JSE), a private limited company established in August 1968.  The JSE is governed by a Council/Board of Directors, which includes representatives of the BOJ,  the Ministry of Finance, the 
Jamaica Bar Association, the Institute of Chartere d Accountants of Jamaica (ICAJ), a council-elected 
independent member and broker members.  The JSE trades securities, ordinary/common shares, 
preference shares, and corporate bonds in local an d foreign currency, although the authorities note 
that there are few US$-denominated corporate bonds listed on the JSE.  There were 42 companies listed on the JSE in early 2004;  manufacturing companies had the highest number, followed by 
banking and financial services, and communications.
42  Minimum requirements to list a security 
include:  a minimum total issued share and loan capital of J$200,000, with the share capital portion 
being not less than J$100,000;   and, in the case of ordinary shares, an issued nominal value of at least 
J$100,000.  Companies must have a minimum of 100 shareholders holding in their own right not less 
                                                      
41 David (2001). 
42 The list of companies traded on the Jamaica Stock Exchange is available online at:  
http://www.jamstockex.com/listing.com. WT/TPR/S/139/Rev.1 Trade Policy Review 
Page 120 
 
 
than 20% of the issued ordinary capital (w orth not less than J$50,000 nominal value).43  T he  f i na l  
decision to list a security is at the discretion of the JSE Council or a committee appointed by it.  The 
Jamaica Central Securities Depository was established in 1998.44 
117. There are ten broker-members, who act as both ag ents and principals, and are the only entities 
permitted to conduct stock-broking activities and to tr ade on the JSE;  a broker-member must be a 
corporation incorporated in a CARICOM country.  The corporation must be owned and controlled by 
natural or juridical persons who are both citi zens and residents of a CARICOM country.  The 
associate members of the Stock Exchange have no tr ading rights but are entitled to attend, without any 
voting privileges, all general meetings of the JSE.  They are also eligible to act as agents in a public 
offer of stocks or bonds for which application fo r listing on the JSE is made.  Commercial banks and 
their associated trust companies can apply to the JSE for membership.  The general requirements for 
becoming a broker-member include that the company has paid-in capital of at least US$166,666, and fit-and-proper criteria are met.  A compensation fund  has been established, with the contribution of 
brokers-members, to indemnify losses to broker-membe rs' clients in certain situations.  The FSC can 
intervene and run and/or wind-up the affairs of  a broker-member under certain circumstances. 
118. The stock market has grown considerably in terms of value traded and capitalization during 
the period under review, although the number of companies listed has declined.  The JSE's market 
capitalization at the end of 2003 was approximately  US$8.8 billion, four times the 1998 capitalization 
in terms of U.S. dollars;  the volume trad ed increased seven-fold over the same period.
45 
119. Government bonds may be traded by broker-m embers in over-the-counter primary and 
secondary markets regulated by the FSC.  The main primary markets are the treasury bill market, the 
local registered stocks market, and the commercial pa per market.  There is a ceiling of J$12 billion for 
the outstanding amount of treasury bills at any time during the year.  Through the commercial paper 
market, companies issue promisso ry notes, which are becoming an important source of funding, 
especially for the manufacturing sector.  Trading in securities in the secondary market has been 
expanding in the last decade, triggered by the need of  financial institutions to meet stricter liquidity 
requirements to comply with BOJ regulations. 
(iii) Telecommunications 
120. The combined contribution of communications, and storage and transport (data for the two 
subsectors are reported together in Jamaica's GDP st atistics) increased from 11.3% of GDP in 1997 to 
13.9% in 2003 (Table IV.15).  This is because growth in these sectors significantly outperformed 
overall GDP growth.  Combined employment has also been growing, to total 60,500 in 2003, but 
considerably less than sectoral GDP growth, sugges ting important productivity gains in the sectors. 
121. Telecommunications is among the sectors in which liberalization has advanced the fastest in 
recent years.  The number of fixed telephone lines in creased substantially in the decade to 2002, from 
167,000 to almost 450,000 (Table IV.16).  The in crease in the number of mobile phones has been 
more impressive:  from 15,221 during the 1993/94, the num ber rose to almost 250,000 in 2000, and to 
1.4 million in 2002.  It is estimated that combin ed fixed line subscribers and mobile users totalled 
some 2.1 million in early 2004, of which some 500,000 were fixed line subscribers and 1.6 million 
were mobile subscribers.  The Government estimat es the number of Internet users at around 600,000.  
                                                      
43 Jamaica Stock Exchange online information.  Available at:  http://www.jamstockex.com/jse_his.htm. 
44 Labour Market Information Syst em, "Finance Insurance and Real Estate 2002".  Available at:  
http://www.lmis-ele.org.jm/Financing.asp. 
45 Jamaica Stock Exchange "Market Capitalization From 1969-2003".  Available at:  http://www. 
jamstockex.com. Jamaica WT/TPR/S/139/Rev.1 
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Access to Internet can be provided through a variety of technologies, such as fixed lines and wireless, 
and through subscription television services.  The stoc k of capital investment in telecommunications 
as at December 2003 was some J$8.45 billion.46  Although mobile coverage currently exceeds that of 
fixed networks, the waiting list for fixed line access rema ins high.  An industry study reports that the 
waiting list for fixed telephone access remained over 168,000 as at March 2003.47 
Table IV.15 
Telecommunications and transport:  co ntribution to GDP and employment, 1998-03  
Indicator 1998 1999 2000 2001 2002 2003 
GDP contribution 11.3 12.0 12.7 13.1 13.8 13.9 
GDP growth (constant prices) 6.4 6.8 6.5 5.1 6.3 3.0 
Employment ('000) 53.4 54.9 56.3 59.4 65.2 60.5 
 
Source: Planning Institute of Jamaica . 
122. Since November 2002, Cable and Wireless  Jamaica Limited (C&WJ, formerly 
Telecommunications of Jamaica Ltd) no longer has the absolute monopoly in the provision of land-
line services.  A second fixed-line supplier, GOTEL,  provides services through a wireless local loop 
(WLL).  However, in late 2003, only 20% of GOTE L's network was operational, offering service to 
four out of 14 parishes, covering slightly over half of Jamaica's population.  Its market share is also 
very small;  C&WJ still controls some 99% of the market.48  In March 2004, Digicel announced it 
would offer landline and data service, first to bus iness customers and then the general public by 
December.49  Up to March 2004, there were three mobile phone providers:  C&WJ, Digicel 
Jamaica Ltd, and Oceanic Digital Jamaica (ODJ), wh ich operates the wireless mobile licence formerly 
owned by Centennial Digital Jama ica.  In March 2004, AT&T was awarded a spectrum licence for the 
deployment of a mobile cellular network, at a pri ce of J$360 million, and with a projected investment 
of JA$1 billion in the first 12 months of operations, making it the fourth player in Jamaica's mobile 
phone industry.50 
Table IV.16 
Telecommunications indicators, 1993-02  
 1993 1996 1999 2000 2001 2002 
Number of land lines 167,251 300,000 493,523 507,107 511,302 450,000 
Mobile phones 15,221a 47,261b 117,861 249,842 640,453 1,400,000 
 
a Data for fiscal year 1993/94. b Data for fiscal year 1995/96.  
Source:  Information provided by the Jamaican authorities. 
123. The Government's broad policy objective is  to utilize the telecommunications industry 
development as an engine of growth for the Jamai can economy.  Intermediate  policy goals include:  
                                                      
46 The Jamaica Gleaner  10 March 2004, "AT&T Roams Jamaica".  Available at:  http://www. jamaica-
gleaner.com/gleaner/20040310/business/business1.html. 
47 Office of Utilities Regulation, Dominant Public Vo ice Carriers:  Determination Notice, Document 
No:  TEL 2003/07, August 14, 2003. 
48 Office of Utilities Regulation, Dominant Public Vo ice Carriers:  Determination Notice, Document 
No:  TEL 2003/07, August 14, 2003. 
49 The Jamaica Gleaner online.  Available at:  http://www.jamaica-gleaner .com/gleaner/20040331/ 
business/business2.html. 
50 TechJamaica.com.  Jamaica's Tech Portal.  Available at:  http://www.techjamaica.com/content/ 
view/586/2/. WT/TPR/S/139/Rev.1 Trade Policy Review 
Page 122 
 
 
extension of the wired and wirele ss networks to encompass the en tire country;  ensuring universal 
access, while maintaining profitability considerations ;  ensuring competition;  maintaining costs that 
are internationally competitive;  and ensuri ng efficient and cost-competitive domestic and 
international connectivity arrangements.51  The Government considers that the liberalization of the 
telecommunications market is one means of achieving these goals.  Measures include the negotiation 
of a new agreement with Cable & Wireless  in September 1999 and the passing of a new 
Telecommunications Act in February 2000.  The market was fully liberalized in 2003, ten years 
earlier than originally scheduled (see belo w).  The authorities have noted that the 
Telecommunications Act 2000 covere d the transitional period from 2000 to March 2003, and that, as 
at June 2004, new legislation was being prepared to  govern the sector in its fully liberalized phase. 
124. According to the authorities the traditional distinction between broadcasting and 
telecommunications is being eroded by convergen ce into a broader information and communication 
technology (ICT) sector.  Policy reform in Jamaica to promote convergence was in a formative stage, 
exemplified by recent changes in the regulatory regime  to allow subscriber television operators to be 
licensed to deliver telecommunications services.  The authorities also note that Jamaica has made 
significant strides in the deployment of a cable communication network, and that they believed that 
this infrastructure held the potential for expa nding and modernizing the wider communications 
network within Jamaica thereby providing access to broadband and other advanced services over 
networks. 
125. The Ministry of Commerce, Science and Technology (MCST) is responsible for 
telecommunications policy in Jamaica.  The MCST aims to develop the telecommunications industry 
so as "to move Jamaica towards becomi ng a knowledge-based connected society".52  Regulation of 
different aspects of the telecommunications industry is carried out by the Office of Utilities Regulation (OUR);  the Spectrum Management Authority (SMA);  and the Fair Trading Commission (FTC).  The Broadcasting Commission, under the Ministry of Information, is responsible for 
regulating broadcasting.  As part of the sector 's reform, the Government is considering the 
establishment of a single regulator. 
126. The OUR was established in 1995 with primar y responsibility for regulating all utilities, 
including the provision of telecommunications services.  The OUR recommends the issuing of licences and ensures compliance with the terms and conditions of carrier, service provider, and dealer licences.  It is also responsible for facilitating the interconnection of entrants (mobile and fixed) to the 
incumbent's existing telecommunications  networks at the most convenient points and at a fair price, 
and of assessing the terms and conditions of interconn ection offers.  The OUR has the statutory power 
to impose arrangements with respect to interconnection.  Dominant carriers must present interconnection offers to OUR for analysis and a determination.  In November 2001, the OUR 
introduced modifications to the existing interconne ction regime, including an 8% increase in fixed 
retention rates, and a similar increase of the applicab le retail rates for fixed to mobile calls.  The OUR 
also determined that, for incoming international calls  to mobile networks the mobile carrier is to 
receive the U.S. settlement rate less a previous ly determined fixed network retention rate.
53  The OUR 
monitors rates and may impose price caps on carrier s and service providers, including the dominant 
fixed network operator Cable & Wireless Jamaica (see below).  The OUR is also mandated to promote competition among carriers and service providers, and to advise the Minister on matters 
relating to the provision of telecommunications services. 
                                                     
 
51 Jamaica Telecommunications Advisory Council (2003). 
52 Ministry of Commerce Science and Technology.  Available at:  http://www.mct.gov.jm/ 
supplement.pdf. 
53 Office of Utilities Regulation online information.  Available at:  http://www.our.org.jm/pdf/ 
Modconnect.pdf. Jamaica WT/TPR/S/139/Rev.1 
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127. The FTC addresses competition policy issues, in particular those related to anti-competitive 
conduct in the sector, for which it works in coopera tion with the OUR.  The SMA, established by the 
Telecommunications Act 2000, is an independent re gulatory body responsible for managing the radio 
frequency spectrum.  It became fully operational in  April 2001;  its main functions are planning the 
use of the spectrum and allocating frequencies, re commending the issuing of spectrum licences by the 
Minister in charge of telecommunications, and co llecting spectrum licence fees.  The SMA is also 
responsible for monitoring and interference manageme nt.  The SMA represents Jamaica's interests in 
regional and international fora, such as the In ternational Telecommunications Union (ITU), the 
International Satellite Organization (ISO), and th e Caribbean Telecommunications Union (CTU). 
128. The Jamaica Telecommunications Advisory Counc il (JTAC) was established in 2000 to assist 
with the sector's liberalization process and advise the Minister on all aspects of telecommunications services.  The Council is required to advise the MCST on all matters relating to telecommunications.  
The Telecommunications Appeals Tribunal was set up under Section 61 of the Telecommunications Act to hear appeals by persons aggrieved by any decision of the OUR. 
129. In 1999, the Government started a process of liberalizing the telecommunications industry, 
which included a renegotiation of the contract w ith C&WJ, the sole supplier of fixed and mobile 
telephony, the passing of new legislation and the adoption of a phased approach for its 
implementation.  In September 1999, the Governme nt concluded an agreement with C&WJ, which 
was granted a 25-year exclusive right to opera te basic telephony services in 1988.  The new 
agreement ended the company's status as a monopoly in the provision of basic telecommunications 
services well before the originally scheduled date  of 2013 (renewable to 2038).  As part of the 
agreement, C&WJ agreed to s upply 217,000 telephone (gross) lines, to spend J$168 million to 
upgrade technology, and J$80 million to defray the initial cost of setting up the SMA.  In consideration of paying that sum, C&WJ would not be liable for any licence or spectrum fees during 
the transition period, but could be required to pay administrative costs.  C&WJ's monopoly rights 
ended as of 1 March 2003. 
130. The passing of the Telecommunications Act (A ct No. 1 of 16 February 2000) redefined 
telecommunications policy in Jamaica and facilitated the gradual opening up of the market to new 
players.  The Act put in place a reform process divi ded into three phases.  Phase I, which started on 
1 March 2000, opened the market to competition in  wireless cellular services, the provision of 
customer equipment, and the resale of data, inte rnational voice and Internet access, while allowing 
companies with Single Entity Free Zone status to provide their own telecommunications services.
54  
The monopoly on fixed-line services was maintained during Phase I, as well as limitations on the granting of certain types of licences (e.g. only two additional licences for mobile telephony);  certain 
licences that segmented the market, such as FTZ carri er licences, were maintained.  Phase II of the 
liberalization process started on 1 September 2001 a nd introduced competition in domestic facilities 
and services, and allowed subscriber TV providers (STVOs) to become Internet service providers 
(ISPs).  Restrictions on international carrier a nd service provider licences were maintained.  At the 
beginning of Phase II, the existing telecommunications carrier, Cable & Wireless Jamaica was allowed to offer its domestic switched voice minut es for resale to domestic service providers on a 
wholesale basis.  Phase III, which  started on 1 March 2003, international voice and data facilities 
opened up to competition. 
131. Provision of all telecommunication services requires a licence, granted by a competent 
authority.  Operation of a facility or a servi ce requires a carrier or service provider licence, 
respectively, upon the recommendation of the OUR.  Licences are also required for the marketing and 
                                                     
 
54 Ministry of Industry, Commerce and Technology (2002). WT/TPR/S/139/Rev.1 Trade Policy Review 
Page 124 
 
 
sale of international services.  The sale, trade in or importation of any prescribed equipment requires a 
dealers licence.  The OUR is required by law to make  public invitations for applications for the grant 
of carrier or service provider licences.  Licence applicants undertake to comply with the provisions regarding interconnection obligations;  universal  service obligations;  and network expansion 
requirements, amongst other things.  Most carrier and service provider licences are valid for a 
maximum of 15 years.  Licensees are entitled to compensation for meeting the universal service 
requirement.  Universal service obligations are to be  funded through contributions in a special fund to 
be created for this purpose.  Failure to comply with the provisions of the Telecommunications Act, 
may result in licence suspension for up to three months, and if the failures continues, the licence may 
be revoked.  The OUR dete rmines its fees based on the estimated  cost of regulating the specific 
services to which the licences relate. 
132. Between 2000 and March 2004, 346 telecommunica tions licences were issued, including:  
65 Internet service providers;  51 international voice  service providers;  29 da ta service providers;  
52 international carrier;  28 domestic carrier;  38 do mestic voice service provi ders;  8 free trade zone 
carriers;  and 10 free trade zone service providers licences. 
133. The sector's reform has increased competition in the industry, which has led to a decline in 
rates.  The OUR has an active role in this resp ect, trying to foster competition and ensuring that 
pricing mechanisms are not used by larger carri ers to eliminate smaller ones from the market, or 
prevent new entrants.  Under the new regulatory environment, telecommunication services retail pricing policies are left to the licensee, except in  the case of a dominant carrier.  Interconnection 
charges and other prices for a dominant carrier must be cost oriented.  Cross subsidies are not 
allowed:  pricing policies must take  into account the principle that co sts should be borne by the carrier 
whose activities cause those co sts.  Also, non-recurring costs must be recovered through non-
recurring charges;  similarly, fixed costs must be  recovered through flat charges and variable costs 
with charges that are based on usage. 
134. The Telecommunications Act mandates th e OUR, following consultation with the 
Fair Trading Commission, to identify which public vo ice carriers are to be classified as dominant.  A 
public voice carrier who has been declared dominant is obligated to file a reference interconnection 
offer (RIO) with the OUR setting out the proposed terms and conditions for interconnection with its 
network.  The Act also provides for the OUR to pr escribe a number of "competitive safeguard rules", 
including accounting separation, and keeping of reco rds, etc., in order to prevent dominant public 
voice carriers from engaging in anti-competitive prac tices.  In a recent determination the OUR has 
declared C&WJ the dominant fixed carrier and a d ecision as to dominance in the mobile market is 
pending.  Even before a declaration of dominance was made C&WJ’s services, except mobile services, terminal equipment, internet service provi sion, and interconnect services, have been subject 
to price cap regulation. Interconnect services are provided under an interconnection agreement 
between C&WJ and the interconnect seeker, and th e terms and conditions governing such agreements 
including charges are subject to regulatory oversight by the OUR.  The first price cap plan was set for 
four years (1 September 2001 through 31 August 2005).   Prior to this, C&WJ was subject to rate-of-
return regulation.  Price caps are published and made available online.
55  Price Caps are calculated 
through the Price Cap Index (PCI) and the Actual Pr ice Index (API).  The PCI is calculated annually 
based on measures of economy-wide inflation in Jamaica and estimates of the company's own 
productivity.  The API is the actual weighted price le vel of C&WJ's prices at a given moment and is 
adjusted with each price change and must remain less than or equal to the PCI for C&WJ to be in full 
compliance with the regime.  For every year after th e initial one, the PCI is calculated according to a 
                                                      
55 Office of Utilities Regulation online information.  Available at:  http://www.our.org.jm/ 
telerateschedule.asp. Jamaica WT/TPR/S/139/Rev.1 
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formula, which takes into account changes in th e Consumer Price Index (CPI), a quality service 
adjustment which is set at zero during the four y ears, and an exogenous adjustment factor to take 
account of rapid reduction in settlement rates.  Th e API is calculated using a formula that takes 
account of the quantity demanded of a price-cap rate service in the prior fiscal year;  the current price 
for a price-cap service in the current price ca p year, and the average "headroom" (percentage 
difference between the PCI and the API) during th e months of September through March of the 
previous price cap year. 
135. In June 2004, the OUR introduced new rule s on termination charges for incoming 
international calls terminating on fixed and mobile networks.  The new regulations removed the 
minimum settlement rates of US$0.081 for internati onal calls terminating on a fixed network, and 
US$0.169 for international calls te rminating on a mobile network, a nd let settlement rates be freely 
negotiated.  The regulations mandate all locally li censed international carriers to provide the OUR, 
with information pertaining to contract details  with each correspondent foreign carrier indicating 
prices, volumes, points of handing over traffic and other terms of the contract for traffic terminated in 
Jamaica in the calendar month, as well as the volumes of traffic obtained from each foreign carrier for 
termination for fixed and mobile networks.  Also in June 2004, the MCST imposed a universal service 
charge of US$0.035 per minute on all incoming in ternational calls termin ating on all domestic 
networks, to be collected by the respective domestic network operato rs and paid to the 
Universal Service Fund (USF). 
136. The Minister responsible for telecommunications  is ultimately responsible for the allocation 
and regulation of the spectrum.  Under the Telecommunications Act 2000, the SMA has been 
delegated authority for the management of the spectrum.  The SMA has developed a value-based 
mechanism for charging and allocating regulatory fees across spectrum users, as regulated by the 
Telecommunications (Spectrum Regulatory Fees) Re gulations of 30 April 2003.  The licensing 
application processes was overhauled in 2001, leading to an increase in the number of applications 
and approvals:  between April 2001 a nd March 2003, 223 licences were approved.56  The SMA 
collected J$37.1 million in spect rum licence fees for the period Ap ril 2002 to March 2003.  Spectrum 
licence pricing follows a market-b ased approach, whereby compani es are charged based on economic 
value of the spectrum being utilized, determined by the Spectrum Management Authority.  The spectrum licensing regime was revised starting March 2000, but existing licenses were honoured. 
137. Jamaica did not table commitments on telecomm unications in the Uruguay Round.  However, 
it accepted commitments on telecommunications in th e Fourth Protocol of the GATS containing the 
results of the extended WTO negotiations on telecommunications.
57  The Schedule contains 
limitations on market access (commercial presence  and cross-border supply), which reserve voice 
telephone services, (as well as voice telephony over the Internet), and telex and facsimile services, 
which are reserved for a single supplier until Septem ber 2013.  In addition, the commitments specify 
that call-back services were not permitted, and that te lephone, telex, teleprinter,  and facsimile services 
may not be supplied over cable TV networks.  Since the conclusion of the WTO negotiations on 
telecommunications services Jamaica has moved to liberalize several of the services listed in its schedule.  As part of its commitments in the F ourth Protocol, Jamaica also adopted the Reference 
Paper on Telecommunications. 
                                                     
 
56 Information on spectrum licences available online at:  http://www.mct.gov.jm/Number%20of% 
20Spectrum%20Licences%20and % 20Certifications.pdf. 
57 WTO document GATS/SC/45/Suppl.1, 11 April 1997. WT/TPR/S/139/Rev.1 Trade Policy Review 
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(iv) Transportation 
(a) Air transport 
138. The air transport industry in Jamaica comprises th e national airline, Air Jamaica;  a domestic 
airline, Air Jamaica Express;  five local operators providing charter services;  two flight training units;  
one aerial applicator, and six approved maintenan ce organizations.  Jamaica has two international 
airports, Norman Manley in Kingston, and Sang ster in Montego Bay.  The Norman Manley 
International Airport has the lead in freight movement, with some 17.5 million tonnes in 2003, 
compared with 6 million tonnes at Sangster.  In numbers of flights and passengers, however, 
Sangster International is the leading airport;  60,0 56 flights and 3.2 million passengers passed through 
in 2003, compared with Norman Manley's 27,881 flights and 1.4 million passengers.  Apart from the 
national airline, several airlines service Jamaica's two main airports.  There are also four active domestic aerodromes, Tinson Pen, Boscobel, Ken Jones, and Negril. 
139. Air Jamaica, privatized in 1994, is 75% privatel y owned.  Local operators are totally locally 
owned;  Jamaican law requires that airlines be substantially owned and controlled by Jamaican 
citizens, except if otherwise approved by the Minister  responsible for air transport.  Airline operations 
are monitored by the Civil Aviation Authority, under the Ministry of Transport and Works.  Airlines 
have the right to transport cargo and passengers .  Foreign operators may not undertake cabotage. 
140. The Ministry of Transport and Works is respons ible for air transport policy formulation and 
implementation.  Policy issues are discussed at the Jamaican Air Policy Committee.  The Civil 
Aviation Authority (CAA), a statutory organization within the Ministry of Transport and Works, 
regulates the aviation industry.  The CAA also oversees all air navigation activities, including 
economic aspects, and matters relating to safety in civil aviation in Jamaica. 
141. Air transport services are regulated by the Ci vil Aviation Act 1966, as amended in 1994 and 
1995;  the Civil Aviation (Air Transport Licensing ) Regulations 1966;  the Airports (Economic 
Regulation) Act 2002;  the Airports Authority Ac t 1974, as amended in 1997 and regulations made 
there under;  and the Aircraft (Tokyo, the Ha gue and Montreal Conventions) Act 1984.  The 
authorities note that the Civil Aviation Amendment Act of 2004 is being examined by Parliament and 
is expected to be promulgated during 2004. 
142. The Airports (Economic Regulation) Act 2002,  establishes the framework for the economic 
regulation of Jamaica's airports.  The Act grants the CAA the legal authority to regulate scheduled 
airports, presently Sangster International and No rman Manley International.  The CAA has the 
authority to regulate certain airport charges a nd deal with public interest issues including anti-
competitive behaviour. 
143. Aerodrome certification regulations were en acted into law in March 1999.  The CAA is 
working with airport and aerodrome operators to complete certification and registration requirements 
to comply with international standards.  Aerodr omes used for international transport or served by 
scheduled airlines carrying ten or more passengers must be certified.  Other airdromes must be 
registered in the Jamaica Aeronautical Information Publication (AIP) Jamaica. 
144. To provide commercial air services in Jamai ca, it is necessary to obtain a licence for 
scheduled services or a permit for non-scheduled air services, from the CAA's Economic Regulation Department.  Applications for ope ration of commercial air services for over 30 days are published and 
interested parties may lodge objections. Jamaica WT/TPR/S/139/Rev.1 
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145. Air fares are not regulated, but must be approved by the CAA.  Fares on international routes 
are generally determined based on bilateral agreem ents.  Scheduled carriers operating flights into 
Jamaica are required to file fares and rates, and th eir conditions, with the CAA.  Air tickets are not 
subject to the GCT, but a stamp duty is applie d, which depends on the value of the ticket for 
international destinations, and is a fi xed amount for domestic destinations. 
146. Since 1 January 2003, the CAA has been respons ible for setting maximum airport charges, for 
five-year periods.  Section 2 of the Airports (E conomic Regulation) Act, 2002 identifies airport 
charges, as those charges which may be levied on ai rcraft operators in conn ection with the landing, 
parking, or taking off of aircraft at the airport, as well as on passengers in connection with their arrival 
or departure by air from the airport.  Charges le vied on passengers are included in the air ticket.  
Under the Airports (Economic Regulation) Act, 200 2, airport operators must submit to the CAA an 
application for permission to levy fees or charges, as detailed in the Airpor ts (Economic Regulation) 
(Charges and Fees) Notice, 2003.  The CAA generally attaches mandatory and discretionary conditions to permissions.  These conditions genera lly aim at correcting anti-competitive conduct by 
operators, or prevent such future conduct.  Permissi on holders must provide the CAA, together with 
their annual accounts, their schedule of airport charg es and changes to the original application.  The 
detailed conditions to obtain permission to levy air port charges, as well as their commercial terms, are 
outlined in the Airports (Ec onomic Regulation) Act, 2002. 
147. As of June 2004, there were two separate operato rs of Jamaica's two international airports.  
They had both sought and obtained permission to  levy airport charges consisting of landing fees, 
parking fees and use of loading bridges in respect of aircraft.  The two operators had also obtained 
permission to levy service and security charges.  The authorities have noted that, on both occasions, the CAA exercised its authority to attach discretiona ry conditions to the permissions.  They also noted 
that, as permitted under the Airports Act, the Minister  had modified the first full review period of the 
operators from five to 12 years, with an interim review in the sixth year. 
148. The CAA also oversees airworthiness and safety of aircraft operating in Jamaica, through its 
Flight Safety Division, which is also responsible fo r the registration of aircraft, validation of foreign 
licences held by pilots, aircraft maintenance engin eers (AME), and air traffic controllers. There are 
some 85 aircraft on the Jamaica Civil Aircraft Register.
58  The CAA's Air Navigation Services 
Division is responsible for the provision, management and control of air traffic services and aeronautical telecommunications. 
149. Maintenance services are provided by private ope rators.  National treatment applies on the 
provision of these services, subject to technical requirements.  Also, services may be contracted abroad:  Jamaican air operators contract foreign repa ir work for the Jamaican fleet in six countries at 
over 30 approved foreign repair stations.  These f acilities are inspected regularly by the Jamaican 
authorities. 
150. The Airports Authority of Jamaica (AAJ), under the portfolio of the Ministry of Transport and 
Works, owns and has traditionally operated Jamaic a's two international airports and its domestic 
aerodromes.  The AAJ is mandated to maintain cost-effective and viable  financial operations, 
operating airports in a commercially-driven way.
59  The AAJ was in charge of the implementation of 
the Airport Reform and Improvement Programme  (AIRP), a US$60 million programme geared at 
improving the efficiency, quality and sustainability of airport services. 
                                                      
58 The list of registered aircraft is available onl ine at:  http://www.jcaa.gov .jm/Flight%20Safety.htm. 
59 Airports Authority of Jamaica.  Information ava ilable online at:  http://www.aaj.com.jm/default.htm. WT/TPR/S/139/Rev.1 Trade Policy Review 
Page 128 
 
 
151. The administration of Sangster International Airport (SIA) was given in concession in April 
2003 to the Vancouver Airport Consortium which was selected from among four formal offers, and a 
special purpose company, MBJ Airports Ltd was established.  The concession was granted for 30 years, and a concession fee based on traffic and cargo flows through the airport is payable to the 
AAJ.  The AAJ continues to oversee the activities of the SIA. 
152. Jamaica did not make any specific commitment unde r the GATS with respect to air transport.  
Jamaica's policy towards liberalization in air tran sport services is to grant market access through 
bilateral agreements.  In this respect, Jamaica h as bilateral aviation agreements with 21 countries, 
including an Open Skies Agreement with the Un ited States;  the countries are:  the Bahamas, 
Belgium, Canada, Chile, Cuba, Denmark, the Domi nican Republic, Germany, Haiti, Hungary, Italy, 
the Netherlands, Norway, Panama, Sweden, Swit zerland, Trinidad and Tobago, the United Kingdom, 
the former USSR, and Venezuela. 
(b) Maritime transport 
153. Jamaica's main seaports include Kingston, Mont ego Bay, Ocho Rios, and Port Antonio.  
Other ports include Port Esquivel, Port Kaiser, Port Rhoades, Port Royal, Rocky Point, and 
Rio Bueno.  The main port is Kingston, an important trans-shipment centre.  In 2003, out of a total of 
25 million tonnes handled by Jamaican ports, 10.2 m illion tonnes of cargo were handled in Kingston, 
of which 7.6 million tonnes corresponded to trans-sh ipment.  Trans-shipment activities in Kingston 
almost doubled between 1998 and 2002 (Table IV. 17).  Shipping services are provided by over 
30 shipping lines.  During 2003, there were 3,848 calls  to Jamaican ports, up 7.4% from the previous 
year. 
Table IV.17 
Ports:  ship traffic and cargo flow, 1998-03  
 1998 1999 2000 2001 2002 2003 
Kingston       
Number of vessels (visits) 2,220 2,161 2,302 2,397 2,520 2,531 
Volume of cargo ('000 tonnes) 6,168 6,608 8,320 8,261 8,904 10,176 
Domestic 2,215 2,185 2,430 2,473 2,364 2,577 
Petroleum 1,640 1,794 1,783 1,898 2,236 2,404 
Transhipment 3,953 4.423 5,890 5,788 6,540 7,599 
Outports       
Number of vessels (visits) 1,133 1,201 1,245 1,177 1,232 1,334 
Volume of cargo ('000 tonnes) 11,942 10,940 9,927 11,193 12,362 12,498 
Landed 3,247 3,494 3,445 3,268 3,646 3,795 
Loaded 8,694 7,446 6,472 7,925 8,716 8,703 
Total all ports       
Number of vessels (visits) 3,353 3,362 3,552 3,574 3,752 3,865 
Volume of cargo ('000 tonnes) 19,750 19,341 20,030 21,352 23,502 25,078 
 
Source:  Information provided by the Planning Institute of Jamaica;  and Ports Authority of Jamaica. 
154. The Port Authority of Jamaica (PAJ), a statutory body, owns and controls the Kingston 
transhipment port, the Kingston and Montego Ba y free zones, the port of Montego Bay, which 
includes a commercial terminal and cruise ship termin als, the cruise ship terminal in Ocho Rios, and 
the boundbrook port in Port Antonio, comprising a commercial and a cruise ship terminal.60  T h e  
management of some of PAJ-owned ports has been granted to private enterprises, for example, the 
                                                      
60 Seaports of Jamaica online information.  Av ailable at:  http://www.s eaportsofjamaica.com/. Jamaica WT/TPR/S/139/Rev.1 
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Kingston transhipment port, the largest terminal in the port of Kingston, the port of Montego Bay, the 
Ocho Rios cruise ship terminal, and the Boundbrook port. 
155. The Government is currently inv esting in the expansion of the port of Kingston.  Phase III of 
the expansion programme completed in late 2002, increased the port's container capacity by 400,000 
to 1.2 million tonnes, at an estimated cost of US$105 million.  The dredging of the Kingston harbour 
was also completed in late 2002, at a cost of US$27 million.61 
156. Maritime transport policy is the responsibility of  the Ministry of Transport and Works.  The 
Maritime Authority, a statutory body establishe d under the Shipping Act, 1998, regulates matters 
relating to merchant shipping.  The Authority is responsible for registration of ships and regulating 
seafarers certification;  regulating the safety of shipping as regards constr uction and navigation;  
inspecting ships for the purposes of maritime safe ty and prevention of ma rine pollution;  and 
administering policy for the development of shipping in general.62  The Port Authority of Jamaica 
(PAJ) has regulatory responsibility for the operation of all ports.  It is also mandated to provide and 
operate, and to maintain and improve port facilities and other services as the Minister of Transport 
and Public Works may require.63 
157. Maritime transport activities are governed by the Shipping Act 1998, the Port Authority Act 
1972, and the Harbours Act 1874.  Jamaica is a member  of the UN Convention on a Code of Conduct 
for Liner Conferences.  Jamaica has ratified a num ber of International Maritime Organization (IMO) 
conventions, including:  on maritime safety, marine  pollution, liability and compensation, etc., and 
others are in the process of being ratified.  Jama ica has also ratified the United Nations Convention on 
the Law of the Sea.  Jamaica has exempted cargo reservation from MFN treatment in its GATS 
Schedule, limiting it to signatories of the Conventi on for an indefinite period.  Jamaica made a 
specific commitment on freight transportation. 
158. Jamaica has adopted the International Ship a nd Port Facility Security Code incorporated 
under the IMO SOLAS 74178 Convention.  The Code requires that Jamaican ships and port facilities 
have in place security measures to reduce the threat of  terrorism.  All the ships and the majority of the 
port facilities have been certified and approved,  respectively, in accordance with the Code. 
159. Foreign ships may participate in local trade pr ovided they meet the conditions set out in the 
Shipping (Local Trade) Regulations, 2003.  Under th e Shipping Act, to be recognized as a Jamaican 
ship, a ship must be registered, or licensed and specifically exempt from registration (see below).  Jamaican nationals and businesses, foreign compan ies and partnerships, and persons deemed to 
belong to Jamaica pursuant to the Immigration Restriction (Commonwealth Citizens) Act are 
qualified to own a Jamaican ship;  foreign na tionals require a resolution from the House of 
Representatives.  The Cargo Preference Act, 1979, imposes restrictions on cargoes of bauxite, alumina, agricultural goods, and government-cont rolled goods, which must be carried by ships 
owned, chartered or operated by the Government , or a government-controlled company.  The Act 
provides for countries to which goods are exported to carry up to 50% of the cargoes in ships flying 
the flag of that country.  The Minister of Transpor t and Works may, in the national interest, allow all 
or part of the cargoes to be carried in ships of th e shipper's choice.  However, the authorities note that 
the provisions of the Act are not implemented, since there is no Government-controlled fleet. 
                                                     
 
61 Planning Institute of Jamaica (2002) p. 14.4. 
62 Ministry of Transport and Works online information.  Available at:  http://www.mtw.gov.jm/ 
Dep_Agen/Maritime%20authority%20agency.htm. 
63 Ministry of Transport and Works online information.  Available at:  http://www.mtw.gov.jm/ 
Dep_Agen/port_authority_agncy.htm. WT/TPR/S/139/Rev.1 Trade Policy Review 
Page 130 
 
 
160. Owners of Jamaican ships may benefit from fisc al incentives.  Jamaican ships engaging in 
foreign trade may be declared "exempted ships";  the entities that own or operate an exempted ship 
(approved shipping entities) may be exempted from income tax in respect of gains derived from 
ownership or operation of the ship for ten years,  renewable.  Approved shipping entities are also 
exempt from transfer tax, stamp duties, and cust oms duties and GCT on imports to be used for the 
operation of an exempted ship. 
161. Jamaica has adopted measures to comply with the U.S. Container Security Initiative (CSI), 
launched in 2002, is to prevent containerized ca rgo from being exploited by terrorists.  The 
Montego Bay and Kingston ports have introduced X -ray machines for scrutinizing import and export 
cargo, as required for certification under the CSI.  Jamaica expected to comply with all the 
requirements for certification by mid 2004.64 
(v) Tourism 
162. Tourism accounts for some 10% of GDP and for 8% of total employment (directly employing 
an estimated 75,000 people, of which 30,000 in  the accommodation subsector).  Tourism has major 
spill-over effects to other areas of the economy, ma inly construction, manufact uring, and agriculture, 
but also other services, and its overall contribut ion to Jamaica's economy is much larger than 
suggested by the GDP figures. 
163. Tourism continues to be the main earner of foreign exchange in Jamaica, with almost 
US$1.34 billion in 2003.  The subsector generat es some 50% of Jamaica's foreign exchange 
receipts, equivalent to over 80% of exports of me rchandise.  The travel balance posted a surplus of 
US$951 million in 2002, which, alth ough lower than in 2001, prov ided, together with current 
transfers, financing for Jamaica's traditional merchandise trade-balance deficit, and allowed an accumulation of foreign exchange reserves (Chapter I). 
164. After growing rapidly during the 1990s and in 20 00, tourism receipts contracted in 2001 and 
remained depressed in 2002.  The number of visito r arrivals followed a similar pattern, although less 
pronounced (Table IV.18).  Average expenditure pe r day was US$89 for stopovers in 2002.  Tourism 
in Jamaica was considerably aff ected by the 11 September 2001 attacks in the United States, which hit 
in particular the cruise industry.  However, figur es for 2003, show that the industry seems to have 
recovered:  for the period January-December 2003, the number of stopovers was 6.6% higher than in 
the previous year, while the number of cruise arri vals was up by 30.9%, and tourist earnings increased 
by 10.5%.
65  Tourism has also been affected by increasing labour costs, and high operational and 
capital costs.  In this respect, the authorities note th at this is not peculiar to tourism and that the 
subsector did not appear to be threatened by rising labour costs.  They also note that tourism operates 
in a fiercely competitive environment, and opera tors must upgrade products and services on an 
ongoing basis;  the high cost of capital has an im pact on their ability to do so.  However, tourist 
operators have the opportunity to borrow in foreign currency. 
165. Almost three quarters of arrivals in 2003 we re from the United States, 16% from Europe, and 
7% from Canada.  There were 24,239 rooms available in 2002, of which 15,358 in hotels and the rest 
in hostels.  There were 172 hotels, 38 of which we re all-inclusive;  however, since the all-inclusive 
hotels tend to be larger, some 46% of the rooms av ailable were operated on an all-inclusive basis, 
excluding hotels that offer dual packaging.66  Over half of the available rooms are operated by chains, 
                                                      
64 Jamaica Gleaner online information.  Available at:  http://www.jamaica-gleaner.com/gleaner 
/20030627/news/news1.html. 
65 Bank of Jamaica (2004). 
66 Information provided by the authorities;  and Price, Waterhouse Coopers (2002). Jamaica WT/TPR/S/139/Rev.1 
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of which eight are domestic and seven foreign.  Jamaican chains operate 62% of available rooms.  
Three of the five largest hotel chains are domestic groups.  The Government divested from the sector in the 1990s, when eleven hotels were privatized. 
Table IV.18 
Summary performance of tourism, 1999-03  
Performance indicators 1999 2000 2001 2002 2003 
Visitor arrivals (thousands) 2,012.7 2,230.3 2,116.9 2,131.8 2,482.9 
    Stop-over 1,248.4 1,322.7 1,276.5 1,266.4 1,350.3 
    Cruise 764.3 907.6 840.3 865.4 1,132.6 
    By source market (stopover)      
    United States 870.0 942.6 916.7 925.6 969.7 
    Europe 218.7 199.0 181.0 179.1 218.9 
    Canada 110.3 107.5 111.2 97.4 95.3 
    Caribbean 38.0 44.0 40.9 41.1 43.8 
    Latin America 15.6 14.7 14.8 11.9 10.9 
    Japan 8.4 7.8 7.9 4.7 4.2 
    Other 7.3 7.2 4.5 6.6 7.9 
Earnings (US$ million) 1,279.5 1,332.6 1,232.2 1,209.4 1,340.0 
Employment 30,325 31,080 29,142 30,434 30,512 
Number of rooms 23,100 23,640 24,007 24,239 24,625 
Number of beds 47,600 48,907 50,265 50,742 51,494 
 
Source:  Information provided by the Jamaica Tourist Board. 
166. Primary responsibility for the formulation and implementation of tourism policies lies with 
the Ministry of Industry and Tourism (MIT).  The main tourism policies are contained in the Master 
Plan for Sustainable Tourism Development in Jama ica, which promotes the linkages between tourism 
and other productive activities, as well as environmental management.67  Policy objectives include 
enhancing investment in the sector, increasing the foreign exchange generated by the sector, and 
encouraging diversifi cation and expansion. 
167. The Jamaica Tourist Board (JTB), is in charge  of marketing and promoting tourism abroad.  
The JTB is also responsible for granting operation licences (see below). 
168. The Tourism Product Development Company (TPD Co), a limited liability private company 
operating under the umbrella of the MIT, has be en given the mandate to develop and improve 
Jamaica's tourism product, and to provide support to government and quasi-government agencies in 
the development of the tourism industry, particul arly by coordinating and facilitating prompt action 
between public and private sector interests.68  The TPDCo conducts inspections of hotels and tourism 
entities at least once a year.  Establishments that do not meet the required standards are removed from 
the JTB's recommended list.  The TPDCo also act s as a facilitator in developing and implementing 
plans to improve the main resort areas.69  The TPDCo has been traditionally involved in the direct 
management of attractions, and the cleaning and upgrading of resort to wns, but aims to delegate these 
tasks to private operators. 
                                                      
67 Planning Institute of Jamaica (2002), p. 15.2. 
68 The Tourism Product Development Company online information.  Available at:  http://www. 
pdco.org/about_us.asp. 
69 Available online at:  http://www.jis.gov.jm/indus_tourism/index.asp. WT/TPR/S/139/Rev.1 Trade Policy Review 
Page 132 
 
 
169. There is no law specifically governing the tour ism industry;  the Hotel (Incentives) Act and 
the Resort Cottage (Incentives) Act regulate incentives.  Jamaican legi slation allows for total foreign 
control of hotels, resort cottages, or tour operato rs.  Jamaican and foreign nationals may open a hotel 
or start a tour operator business, subject to certain standards and requirements.  The main requirement 
is a license from the JTB, which is mandatory for all entities operating in tourism.  Applications for 
licences are reviewed by the TPDCo, which sends  a recommendation to the JTB.  Accommodation 
licences are granted for life, while for attractions they are granted for three years, renewable.  
Licences for travel agents and tour operators may be granted to both residents and non-residents;  the 
latter require a work permit.  The TPDCo collaborat es with other agencies, such as the Ministry of 
Health, the Fire Department, and the Jamaica Constabulary Force.  The TPDCo intends to step up 
efforts to increase the number of licensed venues a nd to extend licensing in activities such as craft 
trading.70 
170. The tourism industry benefits from a number of incentives schemes.  The Hotel Incentives 
Act (HIA) allows for a ten-year relief from income tax, GCT, and import duties for specific types of building materials, machinery and equipment.  For convention-type hotels with 350 or more 
bedrooms, relief is granted for 11 to  15 years.  Under the HIA, relief is available for ten years to:  new 
hotels;  existing hotels adding a minimum of ten rooms or 30% of the existing number of rooms, whichever is greater;  or existing hotels that intend  to do substantial structural alterations.  To be 
considered as a hotel, there must be at least ten bedrooms, as well as facilities for meals. 
171. The Resort Cottages Incentives Act (RCIA) en courages investment in cottages, villas, 
apartments, and townhouses in resort areas, typically by  private investors.  Cottages must have at least 
two bedrooms, a furnished living ro om, kitchen, and bathroom.  Inco me tax relief is available for 
seven years on new resort cottages.   If the same owner builds a group of resort cottages containing at 
least ten bedrooms in the same village or district, the owner is entitled to seven years relief from GCT, income tax, and importation duties. 
172. The Government also provided assistance until April 2003 to establishments that did not 
qualify for benefits under the HIA or the RCIA,  through the Short-term Incentives Programme 
(STIP), as was previously the case with the Tourist Accommodation Refurbishing Programme.  The first Phase of the STIP was put in place in Novemb er 1999 and ended in November 2000;  the second 
Phase (STIP II) started in October 2001 and ended in April 2003.  The benefits in the first Phase 
consist in the granting of General Consumption Tax (GCT) and customs duty concessions on specific 
items bought locally or imported for the refurbis hment and/or expansion of accommodation facilities 
and natural or man-made attractions;  they were  granted only for accommodation facilities only in the 
second Phase, which was not applicable to tourist attractions.  Concessions similar to those which 
may be obtained by larger properties under the incen tives legislation currently in place were granted 
to hotel properties with less than ten bedrooms and apartments and villas whos e configurations do not 
allow them to be classified as either a hotel or  resort cottage, for the purpose of building and 
refurbishing activities.  Benefits were granted base d on an expanded list of items as provided in the 
schedule to the HIA and RCIA.  Attractions were gr anted benefits in the first Phase of the STIP, on 
the condition that the definition of attraction and th e list of items were agreed by the Ministry of 
Finance and Planning. 
173. The STIP II was also available to large proper ties of over 100 hundred rooms, but subject to 
an assessment of their eligibilit y by a Committee led by the MIT. 
                                                     
 
70 Jamaica Information Service (2004). Jamaica WT/TPR/S/139/Rev.1 
 Page 133 
 
 
174. During the first Phase of the STIP, 24 tourism en tities:  seven hotels, one villa, nine natural 
man-made and seven water-based attractions receive d benefits.  During STIP II, ten hotels were 
approved for benefits, four of these were la rge properties with more than 100 rooms. 
175. The MIT put in place in 2001 an Emergency Incentive Scheme (EIS), a short-term assistance 
programme for tourism industry operators affected  by the 11 September 2001 events.  The EIS, in 
place from 1 October 2001 to 30 September 2002, pr ovided benefits for refurbishing accommodation 
and attractions facilities, in the form of waivers on all taxes, included import duties, except the GCT. 
176. The Small Hotel Assistance Programme, a short-term incentives programme, for the period 
July-September 2002 provided financial and techni cal support to small hotels, villas, guest houses, 
and tourist attractions to help them meet regulat ory standards in health, safety and security.  The 
programme was for J$5 million, with a maxi mum of J$300,000 (US$5,000) per beneficiary. 
177. Jamaica's Schedule of Specific Commitments under the GATS places no limitations on 
market access, save for registration and licensing re quirements, for cross-border supply, consumption 
abroad, and commercial presence, for the activities of hotels, restaurants, travel agencies, and tour 
operators.  There are no national treatment limitati ons.  The movement of natural persons remains 
unbound.71 
                                                      
71 WTO document GATS/SC/45 of 15 April 1994. Jamaica WT/TPR/S/139/Rev.1 
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