Washington, D.C., April 22, 2022 — The International Finance Corporation (IFC)—a member of the World Bank Group (WBG)—has agreed to support the Government of Jamaica (GoJ) in the development of three key brownfield road segments on the North Coast Corridor of the Caribbean country. The initiative aims to improve the mobility of people and goods as well as strengthen the Jamaican tourism and hospitality sector.
In the context of the 2022 Spring Meetings of the International Monetary Fund and the WBG, held this week in Washington, the parties signed a memorandum of understanding (MoU) as a first step towards the final advisory services agreement. Under the MoU, IFC is poised to help the Jamaican government design and implement a public-private partnership (PPP) transaction—including due diligence, structuring and implementation—to identify and select a private sector participant to undertake the project. Investors will be expected to finance, build, and operate three road segments of 60 km on the northern coast of the island —Seacastles to Greenwood (6.8 km), Greenwood to Discovery Bay (40.7 km), and Salem to Mammee Bay (12.3 km). The investment amount for the successful completion of the project is estimated to be in the range of $600 million to $800 million, depending on the final design.
"Jamaica's North Coast Road infrastructure is facing capacity constraints and is inadequate to sustain anticipated future economic activity. As such, the GoJ is intent on pursuing an open, competitive, and transparent process to attract large investors who have the capital and ability to procure construction services from providers, who have the expertise to undertake this project, which will be the single largest infrastructure project in Jamaica's history," said Nigel Clarke, Minister of Finance and the Public Service.
Road traffic in Jamaica has steadily grown over the last decade given economic growth and a developing tourism sector along with demand for increased mobility. Further, traffic has exceeded earlier volume projections, creating a capacity deficit of more than 5,000 vehicles a day on multiple sections of the North Coast Corridor, causing unwarranted road delays due to slower pace of traffic.
As a result, there is an urgent need to upgrade and expand roads on the North Coast Corridor from two to four lanes, add intersections, and create overpasses, among other critical investments. This will further help improve access to Montego Bay and Ocho Rios, two major tourist attractions on the Corridor.
"Good roads not only help move people and cargo; they also pave the way for sustained social and economic development," said Stephanie von Friedeburg, IFC's Senior Vice President, Operations. "This project will help reduce travel time, give a boost to tourism, and open up new areas for development and economic growth. We are pleased to bring IFC's extensive experience in public-private partnerships to support the construction of this important piece of infrastructure in Jamaica."
The project will be supported by the Global Infrastructure Facility (GIF).
"The GIF is glad to partner with the IFC, a key technical partner, to support the Jamaican Government's efforts to improve infrastructure services through PPPs. By improving road circulation along one of the key tourism corridors of the country, the project shall contribute to a stronger post pandemic economic recovery, wider socio-economic benefits, and sustainable growth in Jamaica. The GIF is well positioned to support further strategic initiatives in the country and the Caribbean region through such partnerships," said Jason Zhengrong Lu, Head of GIF.
Since 2004, IFC has advised and closed 164 PPP projects that will lead to an expected $41.6 billion in private financing being invested in developing countries and over 150 million people who will directly benefit through better access to services and infrastructure.
About IFC
IFC—a member of the World Bank Group—is the largest global development institution focused on the private sector in emerging markets. We work in more than 100 countries, using our capital, expertise, and influence to create markets and opportunities in developing countries. In fiscal year 2021, IFC committed a record $31.5 billion to private companies and financial institutions in developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity as economies grapple with the impacts of the COVID-19 pandemic. For more information, visit www.ifc.org.
About GIF
The Global Infrastructure Facility is a global collaboration platform, established in 2014 as a G20 initiative, that facilitates the preparation and structuring of complex infrastructure public-private partnerships (PPPs) to enable mobilization of private sector and institutional investor capital. To date, the GIF – in collaboration with its ten multilateral development bank partners – have financed over 120 infrastructure programs and projects in 58 emerging markets and developing economies.
Stay Connected
www.ifc.org/lac
www.twitter.com/IFC_LAC
www.linkedin.com/company/ifc-américa-latina-y-el-caribe
www.facebook.com/IFCwbg
www.instagram.com/ifc_org/
www.youtube.com/IFCvideocasts
www.twitter.com/IFC_org
www.ifc.org/SocialMediaIndex
