Jamaica to forgo US$10 million in levy payments from cash-strapped Windalco

 

The government is to forgo some US$10 million in levy payment over two years from Bauxite Alumina Company Windalco which is facing financial hardships.

 

Finance Minister Dr. Nigel Clarke told Parliament Wednesday afternoon that the company approached the government stating that it was on the brink of closure and in need of assistance.

 

Dr. Clarke said the move by the government will save the jobs of hundreds of employees and the thousands more who depend on the company for their survival. 

 

"The payroll for Windalco on an annual basis is US$24 million - US$24 million on an annual basis that goes to 600 Jamaicans and that is what is at risk. If the plant closes, that US$24 million that comes in every year to pay Jamaicans would go to zero. And what we are giving up in order to ensure that those jobs are saved is an amount of $5 million approximately. So it's $5 million that you give up, but we keep $24 million per year of jobs in Jamaica," Dr. Clarke reasoned. 

 

He added that Windalco's bauxite/alumina exports bring in foreign exchange earnings of approximately US$150 million.

 

The Finance Minister advised the House of Representatives that Windalco was the only bauxite/alumina company that had been paying the levy.

 

But Opposition Spokesman on Mining Phillip Paulwell encouraged the government to ensure bauxite and alumina companies contribute to the bauxite levy. 

 

"I think a strategy has to be devised where we put all the players back into that regime. It was a very good concept and system that was put in place. Jamaica realised a lot of revenues that went back into the communities. And until we get back to that stage where we can generate tremendously more, far more amount to the bauxite levy, we are going to see the increase in pressure and tension between the community and the companies," he cautioned. 

 

"I do acknowledge that the jobs are relatively high paying, in fact higher paying than some of the other industries that we support. So I acknowledge that. But I think we have to have a long-term strategy so that we don't have to be here every so often," said Mr. Paulwell.