BUSINESSES looking to supply energy are being encouraged to consider opportunities within Jamaica’s Special Economic Zones (SEZs).

According to Kelli-Dawn Hamilton, chief executive officer of the Jamaica Special Economic Zone Authority (JSEZA), existing companies cannot come into the SEZ because of base erosion and profit shifting (BEPS) concerns, but new entities or business lines are eligible for consideration.

“If you have a new area of business that you’re going into, particularly if you are prioritising exports, SEZ could be for you,” said Hamilton, while addressing participants at the Re-Align Business and Investment Conference.

In acknowledging that micro, small and medium enterprises (MSMEs) are the driving force of the economy, Hamilton said developing an MSME/SME regime is a key part of JSEZA’s mandate. However, she noted that this cannot be done in isolation and would require support from the SME community to help shape the policy. She also pointed to a pending energy policy for SEZs, explaining that the Authority is lobbying for SEZ-specific provisions to be contemplated in the negotiation of the new Energy Act. This would allow SEZ companies to provide electricity to their occupants, potentially at reduced costs due to the lower operating expenses within SEZs. She added that the push to have developers provide energy is key to how SEZs should operate as a true township.

“The objective is to have the place set up turnkey operations,” she clarified.

While the timeline for deliberations for the Electricity Act is still pending, the Authority is actively seeking partners who can build out the space. As the government focuses on alternative and sustainable energy, the SEZ Authority intends to identify land suitable for development and the companies capable of building it out. In addition to its expansion plans, the SEZ Authority continues to promote the benefits available to companies operating within the zones. At present, there are 114 firms established across Jamaica’s SEZs. These entities benefit from reduced corporate income tax rates, exemptions from duties, and relief from general consumption tax (GCT), making the SEZ regime an attractive model for businesses pursuing new ventures. The Authority has also been working to digitise its processes as part of efforts to position Jamaica as a competitive nearshore destination. The objective is to create a ready-made framework that facilitates the smooth entry and exit of goods for international clients. Efforts are also underway to reduce the number of touchpoints involved in the export process. While importing remains relatively seamless, the Authority is aiming to bring similar efficiency to export activities.

“The JSEZA is examining the shipping industry to advance trade, but feedback from the small business sector will be critical for the JSEZ to be able to build out anything properly,” Hamilton stressed.

Although she acknowledged that businesses are operating in an increasingly uncertain global environment, she said many are looking for greater regulatory and legislative clarity.

“As a part of its incentive framework, all MSMEs operating within SEZs have access to Productive Input Relief (PIR), which offers a reduction in corporate income tax liability from 12.5 per cent to 7.75 per cent,” she shared. “Once you’re filing your taxes, if you’re doing research development and if you are paying your employment tax credits on time, then that is a deduction that can lower your corporate income tax rate.”

Businesses involved in sectors such as film, tourism, health, manufacturing, and agro-processing may import productive inputs duty-free, provided they are properly registered and up to date on tax filings. other benefots include no duty fees on items used in within their zone and no GCT. At present, the MJS Industrial and Tech Park, which recently opened, is the only SEZ operating in Spanish Town, St Catherine. The Caymanas Special Economic Zone, the Authority’s major expansion project, being led by the Port Authority of Jamaica, is expected to break ground in July and will span 700.4 acres. The development aims to create a fully integrated township with space for manufacturers, agro-processors, small businesses, and residential facilities.

“The Caymanas SEZ will be an industrial hub, a space for manufacturers, agro-processors, small businesses and residential facilities. All the ecosystem needed to support the infrastructure for a true logistics hub will be housed there,” she said.