A recent partnership between port operator Kingston Wharves Limited (KWL) and international shopping club PriceSmart is set to open up a new wave of nearshoring opportunities locally.

KWL, which has long sought to tap the opportunities of nearshoring, has been actively taking steps to strengthen its position in the area.

Touting its strategic position in the Caribbean in proximity to major markets and connecting it to over 45 global destinations, KWL CEO Mark Williams believes these advantages will significantly strengthen the company’s position to take advantage of a global logistics market, valued at around US$9.96 trillion last year, with expectations to reach US$14.37 trillion between 2023 and 2028.

Labelling the recent deal with PriceSmart as a “major development” and another step in the journey marked by the continuation of work started many years ago, Williams said the ultimate goal is for his company to become the nearshoring destination of choice in the region.

KWL which now secures about 70 per cent of profit from its terminal business and the other 30 per cent from logistics, is through, more nearshoring type opportunities, looking to equalise profit share.

“PriceSmart is a global brand, so with a partner of that magnitude, what this says to the international market is that KWL, and by extension Jamaica, is establishing itself as a true nearshoring destination. KWL, backed by its logistic and terminal experience, continues to offer all that is right to international partners like PriceSmart enticing them to come and set up shop locally,” Williams told the Jamaica Observer yesterday.

He signalled that with KWL’s ongoing efforts to add more warehousing space as seen by the construction of its over-US$25 million state-of-the-art energy-efficient Ashenheim Road complex in Kingston, timed for completion by the first quarter of 2024, the aim is to welcome more small and large international companies looking for similar opportunities.

“As we build out Ashenheim Road, we have significant capacity and are open for additional opportunities and interest from regional and international manufacturers and distributors who are keen to capitalise on the benefits of doing business in an elite special economic zone,” he added, further indicating to the Business Observer that KWL was now “busy courting other clients similar to PriceSmart.”

The 20-year deal signed with PriceSmart, which guarantees a 10-year lease arrangement, comes with the option to renew in five-year increments. It will allow the international company, now operating some 50 stores across 30 markets in Latin America and the Caribbean, the ability to occupy a portion of KWL’s 300,000 square feet of integrated modular logistics complex. PriceSmart is expected to, by the end of this year, gain access to the facility which will consist of an initial 75,000 square feet of dry goods warehouse and 57,000 square feet of cold storage.

PriceSmart Country Manager Tara Kisto, noting that her company has enjoyed a long-standing partnership spanning more than a decade with the port operator, said that as it continues to grow, the business “could not think of a better partner with whom to move forward than KWL”.