Jesus Silva

Over the last five years Spain has become one of the largest contributors to Foreign Direct Investment (FDI) to Jamaica, investing some US$1.5 billion during that period mainly through the hotel sector.

This first wave of Spanish investment has alerted other Spanish companies who are keen to set up shop on the rock. This new influx of Spanish investment will not solely concentrate on the tourism sector but will include pharmaceuticals, energy/petrochemical and housing.
Last month the Jamaican Prime Minister Portia Simpson Miller had a successful meeting in Madrid with Spain's largest private sector body, the Spanish Confederation of Entrepreneurial Organisations. At that meeting many companies outside of the tourism sector expressed an interest in investing in Jamaica.

Speaking at that special meeting the Prime Minister said:
"The impact of Spanish tourism investment on our island is enormous in terms of potential foreign exchange earnings, economic and regional diversification and employment generation. Jamaica welcomes this buoyant level of Spanish investment in our tourism industry".

Last week the Spanish Ambassador to Jamaica Jesus Silva went to Spain on the invitation of the private sector and the Ministry of Foreign Affairs to a seminar devoted to investment opportunities in Jamaica. The upshot of that seminar is that the second week in May will see an economic mission from Spanish companies coming to Jamaica to examine investment opportunities and find adequate partners here.

Speaking with Caribbean Business Report earlier this week Silva said: "We found hotel companies other than the six that are already here interested in setting up operations in Jamaica. Attendant service companies have also expressed an interest in doing business here and so have companies outside the tourism sector who have seen Spanish companies comfortably settled in Jamaica. Companies are seeing that Spain is becoming Jamaica's leading investment partner and that is good for business.

By Silva's calculations Spanish companies have built 10,000 additional hotel rooms, which spells 12,000 direct jobs, and 30,000 indirect jobs. He adds that the multiplying effect must also be considered in the tourism sector.

"What I have been told is that the sugar industry is the most labour intensive industry in Jamaica employing some 35,000 workers. Over five years six companies have created more jobs than a major economic sector, which has been around for three hundred years. It's an interesting comparison in terms of job creation," said Silva.

Sectors of interest to Spanish companies
The Spanish business sector has identified five areas to make significant investments in Jamaica.

1. The energy sector. Here Spanish companies like Repsol will look at possibilities of exploration and production. The instalation of gas facilities in Jamaica is very attractive. Then there is the prospect of investing in alternative energies. Here Spain has become very competitive more particularly in bio-fuels and the use of windmills.

2. The construction sector. It has been suggested that a Spanish company could set up a construction factory in Jamaica for advanced construction technologies. Here the technology would be applied to social housing projects more specifically the housing needs of hotel workers. It was a problem in the past whereby hotel developers would put up hotels in communities but would neglect their workers' housing needs. The Spaniards do not intend to make that mistake. The Fiesta Group is already building 100 housing units for its workers, right across the road from the hotel. Housing will be offered as part of their contract.

"Outside of housing for tourism workers Spanish companies are keen to get in on social housing. Now the lack of adequate housing is not peculiar to Jamaica. This was the case twenty years ago in countries that have rapidly developed their tourism product, such as Dom Rep, Cuba and Mexico. The governments of those countries did not have the financial means to build affordable housing for hotel staff," added Silva.

3. Technology. Silva said there are a few Spanish companies keen on establishing technology companies here in Jamaica especially related to airports and industrial equipment for hotels.

4. Business related to Spanish language schools. Here there are many opportunities as the Spanish language grows in popularity. Indeed some companies are insisting that its personnel must have the ability to speak Spanish. With major Spanish projects coming on stream in Jamaica workers will need to speak Spanish in order to be effective.

Then there are local companies that need to train their staff and many will require intensive courses in Spanish.
5. Private health care. Here the Spanish government has urged companies to seek opportunities in Jamaica. Private clinics could follow the hotels and attend to their guests' medical needs. That would mean that the sick would not have to fly to Miami. The Spanish have identified a need for more private health clinics in Jamaica. Spanish pharmaceutical companies have also indicated that they would like to have a presence in Jamaica. They would concentrate on distribution and consulting.

Silva has had a number of meetings with Spanish tour operators who are busy with the Jamaican market.
"I had a meeting with one of the biggest tour operators, Sol Tour who is the tour company of the Pinero Group and markets the Principe Hotel group in Spain and Portugal. They told me that Mr. Pinero himself has taken a personal decision to focus on the Jamaican market. They will have one charter flight a week from Portugal, two charter flights weekly from Madrid and another weekly charter flight from Barcelona. They will also market Jamaican hotels and have already formed a deal with Butch Stewart's Sandals chain."
Silva sees a dramatic increase of arrivals from Europe more particularly from the Spanish / Portugal market.
Why this interest in Jamaica?

The Spanish Ambassador said that many people ask him why the sudden interest in Jamaica and what does the country of King Carlos see that other countries do not. He surmises a number of reasons. Over the last fifteen years the Spanish economy has registered strong economic growth and together with low interest rates and a stable macroeconomic policy this has meant that Spanish companies are financially fit and ready to expand beyond their boarders. Then the Spanish tourism market has become very competitive and there is a need to discover and explore new markets. Many Spanish tourism companies have become international and are eager to invest in other countries. In short they are ready for the Jamaican market.

Silva sees the CSME as being very attractive to Spanish companies. Instead of focusing on fractured markets with small populations, there is a region with 15 million people (English speaking Caribbean plus Haiti) where tourism is a stable factor and in many instances drives the respective economies.

"If you include the Spanish Caribbean then you are talking about 27 million consumers, which makes the region very attractive to sizeable companies. Regional integration presents economies of scale and that is attractive.

Jamaica itself is very investor friendly; it has a liberalised economy that follows orthodox patterns, which means there is a certain confidence in your investment. It is not subject to swings of inflation and deflation and economic crises, which is important to foreign investors. Also the general political framework is very stable and the rule of law again fosters stability and confidence. The people of Jamaica welcome foreign investment and that too is attractive to Spanish investors," said the Spanish Ambassador from his Courtleigh Centre offices in New Kingston.

Mothers can't father

Trousers in Denim

Cream of the 'Crop'