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After quietly exploring the viability of a central bank digital currency (CBDC) for some time, Bank of Jamaica (BOJ) took the decision in May 2020, as a part of our ongoing retail payments reform, to venture into this digital innovation that is fast becoming a feature of global central banks. We are proud to be a part of a trend in central banking that is being led by the Caribbean. CBDC is a digital form of central bank issued currency and is therefore legal tender. It is not to be confused with cryptocurrency, which is privately issued and not backed by a central authority. CBDC is fully backed by the Central Bank, the sole issuer. The legislative review to amend the Bank of Jamaica Act to concretize BOJ as sole issuer of CBDC is well underway. CBDC will not be a cost to consumers and will be a full complement to bank notes and coins issued by BOJ. Both CBDC and physical notes and coins will co-exist in the payment space. CBDC will have the major aspects of money, as now obtains with bank notes and coins, with the only significant difference being that it is an alternative to cash to be used primarily for transactions, and will not attract interest when stored in any account. It will, however, like cash, be a store of face value, a medium of exchange, a single unit of account, and a standard of payment. As legal tender, CBDC can be exchanged on a one to one basis with physical cash. Households and businesses will be able to use CBDC to make payments and store value at no cost. Unlike cash, however, consumers will be able to make payments with CBDC anywhere, anytime, on any compatible device. WHAT CBDC MODEL WILL WE USE? Countries and territories using CBDCs issue them using different models, usually including cross border, wholesale, retail, and hybrid (a cross between the wholesale and the retail). A cross-border CBDC entails digital currency issued by the central bank to commercial banks, which can be used for foreign exchange transactions across jurisdictions. A wholesale CBDC entails digital currency issued by the central bank directly to commercial banks, which is in turn distributed by commercial banks in the retail market. Retail CBDC entails digital currency issued by the central bank directly to all users. This would mean that all users would have CBDC accounts at the central bank. A hybrid CBDC aims to combine the benefits of both wholesale and retail in various forms, and falls somewhere on the spectrum between the wholesale and retail models. The CBDC to be issued by BOJ is solely for domestic use, and Bank of Jamaica will be using the hybrid model for issuing CBDC. BOJ will therefore not only issue to commercial banks, but also to other deposit-taking institutions (DTIs) – building societies, merchant banks and authorised payment service providers (PSP), all licensed or authorised by BOJ. These entities will distribute CBDCs to the retail market. CONSUMER ACCESS AND USE OF CBDC In order to use CBDC, consumers will need to have a CBDC account, which will be different from a regular bank account and much easier and simpler to obtain, with streamlined and simplified Know Your Customer (KYC) requirements. While persons who already have bank accounts will be able to automatically obtain a CBDC account, authorised PSP’s as well as DTI’s will be able to on-board unbanked customers. Customers will be able to transfer and convert funds seamlessly between regular and CBDC accounts. In order to carry out CBDC transactions anywhere and at any time, consumers will be able to access, download and deploy a mobile wallet app on any smart phone, tablet or similar compatible device using the networks of both major telecom service providers. Customers will also be able to top-up their accounts with CBDC through all authorised agents or smart ABMs and do business using CBDC phone-to-phone with merchants. BENEFITS OF CBDC Depending on the specifics of our situations, some other countries and territories may anticipate slightly different benefits from using CBDC, but several benefits are universal, and apply to us. Individual consumers and businesses will benefit from: The sheer convenience, from a broadened and more modern payment system, of a digital alternative to cash that is seamless, secure, and simple to use. Greater financial inclusion, as persons who do not currently have regular bank accounts will be able to access CBDC accounts in a way that will be easier and simpler than accessing regular bank accounts. The financial system will benefit from: Increases in systemic efficiency and significant reductions in costs for cash distribution and storage. An increase in the menu items of services available to customers and an opportunity to innovate unique products and systems complementary to CBDC use. Bank of Jamaica will benefit from: Increased efficiency by removing the time and effort it takes to forecast currency needs and order new currency in advance. Significant long-term cost savings. There will be no ‘wear and tear’ on digital currency, and it cannot get ‘lost in circulation,’ so there will never be a need for replacement. In addition, there will be no cost in increasing supply to the system if demand increases over time. The modernization and expansion of BOJ’s currency minting and issuance processes, in addition to the further expansion and modernization of the national retail payments infrastructure in keeping with the desired increased digitization of the economy. CHOICE OF TECHNOLOGY – NOT BLOCKCHAIN The issuance and distribution of the CBDC will be fully integrated with the Bank’s financial market infrastructure, the JamClear® Real Time Gross Settlement System (RTGS). The approach will not compete with deposits in deposit taking institutions, but rather it will leverage the existing financial and telecommunications infrastructures of the country. It is this consideration and prerequisite that led to BOJ choosing a non-block chain CBDC option. Not using the blockchain technology that is often associated with CBDCs is not because of any major concerns with blockchain,

The Airports Authority of Jamaica is seeking to partner with small airline operators and aviation training schools overseas, in a bid to establish the country, as an aviation training hub. President and Chief Executive Officer (CEO) of Airports Authority of Jamaica Mr. Audley Deidrick told JIS News that Jamaica is seeking to tap into the general aviation market, which he points out, is a big growth factor for the country’s aerodromes. He said that aviation training is of special interest to Jamaica, as it has been found to be one of the drivers of general aviation. “Aviation training naturally has as an offshoot, interest in the sector, and by extension, the growth in the sector,” he said. Mr. Deidrick pointed out that general aviation runs the entire gamut, from business aviation to leisure aviation, but it is largely small aircraft operators doing different things. “It is a very big component of world aviation and it’s one that Jamaica, so far, has not tapped into in any substantial way and this is a major area that we intend to embark on, to pursue growth going forward,” he stated. The President said that part of the remit of the AAJ in growing general aviation is to build out training capacity in the country, which in addition to training “will act as a tourism product, if you will, where we can train pilots, and other aircraft operators and mechanics from overseas”. “That’s the power of an aviation training facility, people will send their child across the globe to train in a facility and when they’re finished to get back home to practice their aviation activities,” Mr Deidrick stated. Meanwhile, the President informed that in January 2020, just before the pandemic hit, the AAJ, along with the Jamaica Tourist Board, went overseas to court small aviation operations and also a training school to come to Jamaica. “That is where we were at that time when COVID-19 came, but all is not lost. I think it’s a matter of picking up where we left off with the airline operators and the aviation schools that we have been talking to, and to re-engage them early in the game. As aviation traffic and tourism grow out of the impacts of COVID-19, we will be one of the countries and indeed the organizations that are at the forefront of re-entering the growth path with this trajectory,” Mr. Deidrick said.

Driving sustainable trade and investment during times of uncertainly Sustainability is increasingly becoming a driving factor for decision making as investors tackle more environmentally conscious consumers and more strict environmental laws. Such pressures transcend geographic boundaries for the typical global investor and hence becomes a pivotal element to consider in preventing any reputational damages. The Sustainable Development Goals (SDGs) provide an opportunity for the development of an entirely new type of SEZ with a new focus on environmental performance, science commercialization and regional development. Moving beyond traditional trade labor-intensive manufacturing activities, new types of SEZs are emerging targeted at Industry 4.0, tourism, financial and other professional services. Such zones would aim to attract investment in SDG-relevant activities, adopt the highest levels of ESG standards and compliance, and promote inclusive growth through linkages and spillovers. Best Practices: South Korea’s Eco-Industrial Parks Special economic zones have played a critical part in South Korea’s rapid industrial development over the past few decades. They have contributed to significant economic and social benefits to the country. The Korean National Cleaner Production Center (KNCPC) launched the National Eco-Industrial Park (EIP) program in 2003, in line with efforts by the Ministry of Trade, Industry, and Economy (MOTIE) to promote innovative industrial development which simultaneously achieves environmental sustainability. In order to attain maximization of resource efficiency and reduce waste and pollutants, the development of industrial symbiosis (IS) systems was proposed as a key strategy in EIP implementation. Industrial Symbiosis (IS) is achieved through a collaborative network, in which a one company’s waste is used as raw material for another. In order to stimulate business participation and investment in the program, the Korea Industrial Complex Corporation (KICOX) adopted an engaging and business‑centric strategy. KICOX focused on delivering quick wins and demonstrating economic profitability of EIP projects, especially during the early years of the program implementation. Special Economic Zones have played and continue to play a critical role in driving the global economy, with an estimated 40 percent of global trade passing through them and enhancing the wellbeing of people. As the global economy is preparing for new growth, special economic zones play a key role as facilitators and enablers of the global economy. Though benefits usually outweigh the costs of building and operating a free zone, global experience has been mixed. This has prompted a need for suitable instruments and tools to analyze, measure and improve the performances of free zones globally. In response to these challenges, World FZO launched the “Free Zone of the Future” Program – a Global Initiative for Local Prosperity. The program’s base is an annual data survey of Business Excellence and Economic Contribution variables in free zones – BEEC data. This foundation survey then extends into the Izdihar (Arabic for “prosperity”) Index, the core of the FZF Program, with three strategic dimensions of metrics that measure key areas of a Free Zone’s performance. The Izdihar Index monitors 45 indicators of progress annually to place every Free Zone on its Maturity Curve. The indicators are qualitative, measuring a Free Zone’s achievement in given fields every year. These indicators are used to tailor consultancy mandates for each Free Zone to progress on their journey to Free Zone of the Future status. DIMENSIONS OF THE IZDIHAR INDEX The Izdihar Index indicators are fully aligned with all 17 Sustainable Development Goals defined by the United Nations as 2030 priorities for global development. Events like COVID-19 or economic crises point to the need for more sustainable and diverse economies. Policymakers will need to balance the short-term view on FDI attraction and GDP/ job creation with a long-term reform for economic development that increases self-sustainability from an economic, financial and supply chain aspect. New operating and partnership models for SEZs are needed to create new sources of cash and capabilities to lower public spending and professionalize service delivery. SEZs should be seen as a policy instrument to create a breeding ground for wider economic growth and act as a catalyst for a country’s economic development. World FZO’s Project Director Zoë Harries, will provide a workshop on the role of Special Economic Zones in boosting sustainable economic recovery at Annual Investment Meeting (AIM) Eurasia Chapter, March 3rd at 2 – 3 PM UCT/GMT +3 (Moscow Standard Time). This workshop will cover: – Global FDI trends and opportunities – How SEZs foster sustainable trade and investment – New types of SEZs – Global best practices Register now at https://bit.ly/3mhtTtQ For information on World FZO’s Advisory Services, contact: Zoë Harries Project Director, World FZO M: +971 58 508 7998 E: zoe.harries@worldfzo.org Source: https://www.worldfzo.org/Portals/0/OpenContent/Files/614/WorldFZOOutlookReport2020.pdf

Jamaica is well on its way to operating the first and only dedicated bamboo market pulp mill in the Western Hemisphere. Bamboo Bioproducts Ltd (BBP) is advancing its investment in local bamboo with plans to build on lands in Frome, Westmoreland, and will focus on pulp for paper production. The company projects to spend approximately US$300 million to establish the project with a an estimated return on investment of 22 per cent with conservative projections of US$1.5 billion in revenue during the first 10 years. In addition, BBP anticipates that 500 jobs will be created directly within the facility and up to 5,000 jobs indirectly. Currently, Asian manufacturers are the primary producers in the US$24-billion global bamboo market which fuels a variety of industries including paper manufacturing, agriculture, health and wellness, construction, textiles, and furniture, among others. Jamaica’s proximity to western markets, as well as its deep history in sugar cane production (which has strong similarities to growing bamboo) means that BBP’s Frome facility offers game-changing national economic development opportunities. In emphasising the importance of this project to Jamaica’s economy, Prime Minister Andrew Holness said investments like these, anchored on a sustainable environmental and economic model could lead to a rethink of how we might achieve our development. “This is an example of what is needed to help drive growth in our economy. The use of bamboo and its by-products has the capacity to be a catalyst in building a new sustainable industry by utilising the value that Jamaica can provide with arable lands, availability of skilled and semi-skilled labour as well as our ideal geographic location for logistics,” said Holness recently. “I applaud and welcome this group for responding, through this initiative, to the Government’s continued call for the take-up of former sugar lands for the planting of alternative and more economically viable crops,” added Holness The pulp will be sold to multi-national corporations partnering with BBP to fulfil the growing market demand for sustainable ‘non-wood pulp fibre’ of globally recognised brands of consumer tissue and personal hygiene products. In order to meet its obligations, the Frome mill will have the capacity to process in excess of 250,000 metric tonnes of bamboo pulp annually. The manufacturing process will feature state-of-the-art machinery from one of the world’s leading technology suppliers. It will produce a sustainable product efficiently, whilst simultaneously meeting world-class environmental standards. The project’s execution team includes international pulp and paper experts, as well as lead fund-raiser/equity partner Delta Capital Partners Ltd, headed by co-founder and executive Chairman Zachary Harding. According to Harding, Delta Capital Partners and Stocks and Securities Ltd are actively progressing with the capital raise. “This is, by far, one of the most significant projects to be undertaken in Jamaica in recent decades. Bamboo pulp as an outright export product will generate significant returns in hard currency. “It checks all the boxes including several sustainable development goals and the mill will be eco-friendly using a mix of clean and renewable energy sources. Additionally, market demand is considerably higher than what we will be supplying when fully operational, so we have an excellent opportunity for long term expansion. Most importantly, we will create thousands of jobs, both directly and indirectly,” said Harding. British High Commissioner to Jamaica Asif Ahmad, who has been an avid supporter of this venture from its earliest inception, stated that it is great to see the progress made so far. “This is a clear example of what can be achieved here when committed partners from Britain, Europe and Jamaica put in a combined effort to invest in an export-focused project,” said Ahmad. The bamboo will be farmed on a large scale in Westmoreland as well as smaller farms across Jamaica to satisfy the mill’s annual demand for more than one million tonnes of green Vulgaris bamboo. This is expected to help transition of idle sugar cane lands to bamboo cultivation. BBP is working closely with Sugar Company of Jamaica (SCJ) Holdings Limited to finalise the necessary lands and is also in talks with private landowners to supplement its land demand. “This project has the full support of the Government of Jamaica and the provision of land, for the siting of the mill and the cultivation of bamboo, is a priority project for SCJ Holdings Limited, as it will enhance the country’s foreign exchange earnings and provide a lifeline for the thousands of persons who have suffered from the decline of the sugar industry,” said Joseph Shoucair, managing director at SCJ Holdings Limited Jampro, who is the lead facilitator for the project has been working closely with the relevant Government agencies to ensure a smooth investment and execution process and president of the agency Diane Edwards said the bamboo project embodies all the characteristics of a well-planned, public-private sector project. “It will go a long way in helping to move the economy forward, getting us closer to hitting our projected foreign direct investment targets. It has our full support,” said Edwards.

Construction of the Montego Bay Perimeter Road Project is expected to begin by late 2022. This was disclosed by Managing Director of the National Road Operating and Constructing Company (NROCC), Ivan Anderson, in an interview with JIS News. He explained that the bypass project, which involves the construction of 25 kilometres of roadway, consists of two segments. These are the 15-kilometre Montego Bay bypass project starting from Ironshore and back around to Bogue Road, and the Long Hill bypass involving construction of 10 kilometres of highway from Montego Bay down to Montpelier. “We have received the environmental permit and that allows us to proceed in terms of construction,” Mr. Anderson told JIS News. “We are just about to start the design work for the project and expect that over the next year that design work will be completed,” he added. He told JIS News that the NROCC team is currently in the field doing land acquisitions and surveys and issuing notices where people may be affected. “That allows us to be doing more detailed surveys to establish exactly how it (the project) affects the people, how it affects the properties and, therefore, to be able to then do a valuation of the properties and make them an offer,” he noted. Mr. Anderson told JIS News that the bypass to be constructed for Long Hill will address the challenges in traversing the roadway, including blockages for extended periods when it rains. He said that the Long Hill bypass will connect with the Montego Bay bypass “and go all the way to Montpelier and cut out that difficult section of the road”. The scope of works to be undertaken, the Managing Director said, is considered to be the first phase of the journey “to tie us back to Mandeville, where we are doing the May Pen to Williamsfield project”. “So we’re starting at Montego Bay, going south to Montpelier and then we expect to continue that project further south by Santa Cruz, back up to Spur Tree and then all the way back around to Williamsfield, which will tie back to the rest of the Highway 2000 project,” he indicated. Upon completion, Mr. Anderson said persons will be able to drive all the way from Kingston to Montego Bay along the Highway 2000 corridor.

Transport and Mining Minister, Hon. Robert Montague, says the Government is moving aggressively to upgrade Jamaica’s aerodromes as part of plans to improve commuter travel. He said this should be welcome news for local and international travellers who, he noted, have long voiced concerns about the distance and length of time taken to traverse the island via road. The Minister also advised that work is under way to pilot the local aviation industry’s strong recovery from the impact of the coronavirus (COVID-19) pandemic. He was speaking during the recent opening of the new $17-million Negril aerodrome fire station in Westmoreland. Mr. Montague said improvement work already undertaken at local aviation facilities by the Airports Authority of Jamaica (AAJ) includes the establishment of pilot lounges at the Tinson Pen aerodrome in Kingston, Ken Jones aerodrome in Portland, and Ian Fleming aerodrome in St. Mary, while adding that similar engagements are slated for the other locations. He advised that an overlay is scheduled for the runway at the Lionel Dempsher aerodrome in St. Elizabeth and that “we are also putting in some restrooms and a waiting area”. “Recently, we got a fire truck at Tinson Pen and we are going to be building a new fire station at Ian Fleming,” the Minister further informed. Mr. Montague pointed out that Jamaica’s 14 aerodromes provide commuters with the opportunity to save time and money to move across the island. “Persons, notably visitors going to Ocho Rios, St. Mary or even Port Antonio, can now cut their journey in half by flying out of Montego Bay into the Ian Fleming International Airport… and the same goes for those who want to go to Kingston or Negril,” he stated. Consequent on this, Mr. Montague said no effort will be spared in upgrading the aerodromes “and, by extension, the aviation industry”. For his part, AAJ President, Audley Deidrick, said it is important that local stakeholders and business interests seize the opportunity to make aviation a central part of Jamaica’s economic recovery from COVID-19. He said the fact that the industry is heavily dependent on tourism, which, he noted, accounts for more than 80 per cent of Jamaica’s aviation traffic, makes it a “no-brainer” for stakeholders to position themselves to make domestic travel far more accessible, seamless and timely. “As we look to the post-COVID recovery of our aviation and tourism industries, we need to seize the opportunity to improve the facilities which will place us in the forefront of the market when the resurgence begins,” Mr. Deidrick said. “Let us, therefore, look forward and plan together with the expectation to emerge better and stronger, post COVID,” he further stated. Meanwhile, Mayor of Savanna-la-Mar, Councillor Bertel Moore, who also spoke at the function, urged that consideration be given to upgrading the Negril Aerodrome to enable it to accommodate international flights. “In the near future, I would like to see this aerodrome become a halfway international airport. With Negril being one of the tourism meccas of Jamaica, I am optimistic that the facility can attract enough business to warrant international recognition,” Mr. Moore said.

“Price is a major factor preventing increased movement of cargo by small and medium-sized producers within the Caribbean,” was one of the conclusions coming out of a virtual forum on ‘Inter-island Cargo Transportation’, held on Sunday, February 28, and staged by the Caribbean Association of Customs Brokers (CACUB). The discussion focused on the challenges being faced by suppliers who are unable to fill a container, but “have a pallet or two of goods” that require consolidation, and other types of facilitation, to get to other territories of the Caribbean. Other regional trade issues that were discussed at the forum were the need for all territories to adopt the ASYCUDA World system for Customs that provides a digital platform for greater efficiency, tracking and speed of service, and the need for greater coordination among producers/manufacturers, shipping lines and ports. More than 80 participants, including Caribbean manufacturers, customs brokers, freight forwarders and representatives of shipping lines and ports serving the Caribbean, participated in the first virtual forum staged by CACUB. In his welcome address, Delroy Fairweather, president of the regional association, explained that the forum was convened in keeping with CACUB’s objective of being “a driving force for improving regional trade”. He said that the customs brokers of the Caribbean played an important role in the supply chain and, therefore, felt a responsibility to get all parties together to find solutions. Louis Forde, first vice-president of CACUB, noted that whereas the large manufacturers and producers of the Caribbean Community (CARICOM) can fill whole containers and enjoy the economies of scale and reliability of transportation of their cargo by sea, the smaller LCL (less than container load) producers faced a number of challenges. The challenges faced by LCL suppliers were summed up by Shardae Boyce, chairman and executive director of the newly formed CARICOM Manufacturers Association (CMA), as being lack of reliable and consistent interregional transportation; landing charges being too high at Caribbean ports; and the need for coordination and advertising of available capacities and shipping schedules, including delivery dates. In their response, the representatives of three of the major shipping lines serving the Caribbean – Crowley, Seaboard and Tropical – stated that there was no lack of interregional transportation and that their schedules were available and made public on their websites. With regard to landing charges, it was noted that the ports may be approached to review their charges and fees to facilitate traders with less than a container load. It was suggested that rather than charging by full container, fees could be calculated by pallet, weight or measurement. It was also suggested that the CMA could encourage members to pool their resources and assist in coordinating arrangements among the various parties in the supply chain. With regard to port charges, it was pointed out that governments and trade unions may need to be brought into the discussion, as taxes and labour charges were included in the landing and other fees charged at ports. In his contribution to the discussion, Ambassador G. Anthony Hylton said that there were a number of issues that need to be considered at the policy and industrial levels. He recommended that governments become better acquainted with the issues involving logistics and the supply chain in order to develop and implement policies that address the strategic needs of the region. In concluding CACUB’s first virtual forum, Donovan Wignall, treasurer and assistant secretary of CACUB and chairman of the proceedings, thanked all presenters and participants for their contribution to the discussion. He said that the meeting had pointed to solutions that need to be explored, and that regional organisations such as CACUB and the CMA are being activated at a most opportune time, when the Caribbean needs their involvement in improving regional trade.