China is continuing to increase and diversify its investments inthe Caribbean region.
Confirming trends forecast in recent reports from the United NationsEconomic Commission for Latin America and the Caribbean(ECLAC), Chinese companies have recently announced majordiversified investments in Jamaica and St Lucia.
On July 19 the Jamaican government announced that the Alpartalumina refinery in Jamaica had been sold for US$299m to theChinese state owned entity the Jiuquan Iron and Steel Company(JISCo) owned by the Jersey-registered but Moscow-operated industrialgiant, US Rusal.
According to Jamaica’s Transport and Mining Minister, Mike Henry,JISCo is expected to complete the full takeover of Alpart byNovember this year and will then begin a first phase of investmentof around US$220m in modifying and upgrading the aluminaplant to reduce costs and enhance production. Work permitsare expected to be issued for around 200 Chinese technicians toachieve this and to undertake other activities.
The Minister also said that the company plans to invest another US$1.5bn to establish an industrial zone co-locatedwith the alumina facility, which is located at Nain, St Elizabeth in the south of Jamaica. The project is expected overa four-year period to create over 3,000 new jobs.
Reflecting the political sensitivity of the continuing increase in the number of Chinese workers on the island, MrHenry said that JISCo has been asked to provide details of the required job qualifications to ensure that “no Jamaicanwho is qualified for these…is left out.” He also confirmed that the company would be employing the existingAlpart staff, recruiting most former and available employees and creating around 700 new jobs from the latter partof 2016. He said that the company will be “paying great attention” to protecting the environment. Alpart had beenclosed from 2009 to 2015.
Rusal acquired a 65% stake in Alpart in 2007 as part of its merger with the alumina assets of Glencore, and acquiredthe remaining 35% stake in 2011. Alpart, which uses its own local bauxite production as feedstock, was previouslyreported to have an annual production capacity of 1.65m tonnes of cell-grade alumina.
The acquisition makes JISCo one of the top 10 producers of aluminium in China. The company was established in1958 as a large-scale iron and steel producer but is now diversified into other areas of heavy engineering and powergeneration.
The investment is a sign of increasing Chinese interest in Jamaica as an economic base and follows from a widerange of other Chinese projects underway or being discussed.
In July, Jamaica announced that it had decided to use Chinese concessional loans to upgrade the road network onthe island. Speaking at a press conference, the Prime Minister, Andrew Holness, said that US$384m in loan fundingwould come from China’s Exim Bank to construct a new road network in the southeastern and southwestern partsof the country, including in the neglected parish of St Thomas. The Jamaican government said it will raise an additionalUS$57m of the overall funding required.
Earlier this year the Chinese-built and financed US$730m North-South Highway opened, connecting Kingston toOcho Rios and reducing coast-to-coast transit time to about an hour. The project gives the China Harbour EngineeringCompany (CHEC), which built the highway, a 50-year concession to recover its costs from tolls. The companyalso received land alongside the highway to develop for residential and commercial use.
At the time the Vice President of China Communications Construction Company (CCCC), Ziyu Sun, which owns CHEC,said that it will begin the construction of its regional headquarters in New Kingston later this year.
China has…
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