Triple P for Canada and Jamaica?

Interesting timing for this story. Jamaica and Canada (and the rest of the Caribbean nations that are part of CARICOM) are currently negotiating a free trade agreement. According to my sources, negotiations are not going well. Canadian High Commissioner to Jamaica Robert Ready is the lead negotiator at this time.

But the Gleaner today runs this story that while Canada is cautious about doing business with Jamaica, the potential is there for more PPPs. That is to say, public/private partnerships. Triple Ps have been popular lately as the public sector attempts to finance large-scale projects with a minimum of up-front investment. That is where the private sector comes in- as a partner to carry the initial investments. In return, the private sector gets to own and/or operate the project or asset (there are many different configurations) and the public gets their new bridge/hospital, what-have-you.

Reactions to PPPs are mixed and usually fall along partisan lines. In any case, it is interesting indeed that Canada appears keen on PPPs with Jamaica whilst some tough negotiations with CARICOM are ongoing. Perhaps Canada is more bullish on Jamaica’s future but reluctant to sign onto the new CARICOM agreement. I am not familiar with the details, this is just speculation.

In any case, this Gleaner story illustrates Canada’s approach to doing business with Jamaica. The initiative is being led by Canada’s Export Development Corporation. From the story:

Export Development Canada (EDC) was formed more than 65 years ago to help Canadian companies export products and services and invest internationally.

The agency has already funded large businesses in Jamaica. In 2012, EDC helped finance a Digicel telecommunications equipment project with up to US$250 million and a smaller Jamaica Public Service project involving the sale of various Canadian goods and services for up to US$25 million.

There are some countries that the EDC “will not lend to”, due to the level of risk, said Rick McElrea, senior trade commissioner at the Canadian High Commission.

“Jamaica isn’t one of those,” McElrea said at a workshop hosted by the high commission in Kingston last Thursday.

However, “EDC would be cautious in dealing with Jamaica at this stage,” the trade commissioner said, but would mitigate that risk by partnering with local banks, including Canadian banks in Jamaica, he told the workshop.

Slightly dry topic, but it is important. Enjoy your day.