PRESIDENT OF the Jamaica Manufacturers' Association (JMA), Clarence Clarke, has welcomed the announcement by the Minister of Finance, Dr. Omar Davies of "Development Bond 2000" which will be used to provide medium and long term financing to viable projects in the productive sectors and short term pre and post shipment facilities at a final interest rate of 9.5 per cent per annum.In a statement, Mr. Clarke said that the JMA has over the years, lobbied for single digit interest rates similar to those of regional and international counterparts, and sees this facility as a very strong and positive move in the right direction. He also welcomed the provision that a maximum of 20 per cent of each individual loan funded from the bond proceeds can be utilised for the re-financing of existing debts. He said the refinancing component is absolutely necessary given that numerous manufacturing entities have been suffering from a crushing debt burden that had humbled otherwise viable businesses.
He congratulated the government for the continuation of the policy of reducing the cash reserves ratio and also the commercial banks and other financial institutions for subscribing to the instrument.
Mr. Clarke said that the facility which will support the re-tooling and re-engineering of entities in the manufacturing sector, will provide entrepreneurs with the incentive to undertake new and planned investments and will also improve the viability of companies that access this facility. "This reduced cost of money will also assist manufacturers in expanding their export drive and will enable them to increase employment and production, all of which will contribute towards the government's goal of increasing the Gross Domestic Product," he said.
The JMA stated its commitment to work with the government, lending institutions and applicants from the manufacturing sector to ensure that all viable projects are able to access the funds easily.
