COVID pandemic cost manufacturers an extra $5 billion, says JMEA

 

The Jamaica Manufacturers and Exporters Association (JMEA) says it believes its members have incurred about $5 billion in additional costs due to the COVID-19 pandemic.

 

JMEA President John Mahfood said this includes costs associated with absences, testing, sanitisation and vaccination.

 

"We actually quantify that at around, depending on the size of the company, $50 (thousand) to $100,000 per employee per year. When you relate that to the 80,000 employees in the sector, we were coming up at over $5 billion in costs. That is not a small figure," he revealed during a presentation at Wednesday's meeting of Parliament's Economy and Production Committee.

 

Mr. Mahfood said the figure does not include companies that have had to close because of the pandemic.

 

He disclosed that companies are also facing much higher freight costs and the latest increase in the Bank of Jamaica policy rate will worsen the situation for manufacturers.

 

David Wan, President of the Jamaica Employers' Federation, has also taken issue with the increase in the policy rate to two per cent.

 

He said the government must instead incentivise local production. 

 

"The Bank of Jamaica has increased interest rates in response to increased inflation, a portion of which is imported – and my sense is that the bulk of it is imported, due to supply chain problems in our major trading partners. We believe that the increased interest rates alone will not resolve this problem and it may indeed exacerbate it," he warned.