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High rental charges have put a halt on a multi-million dollar information technology project in St. Thomas. Investors say they cannot afford it.
With the promise of 4,000 new jobs, the project was launched 16 months ago by Government in conjunction with Cable and Wireless, to the tune of $150 million. The aim was to convert the old Goodyear tyre factory into 30,000 sq. ft of space at the Springfield Information Technology (IT) Park.
NOT A SINGLE INVESTOR
However, to date, not a single investor has taken up the opportunity because of the high rental cost and this has sent the Government scurrying back to the drawing board and cutting the monthly rental of the complex. "Several persons were interested but they were complaining about the proposed rental rate," said Philip Paulwell, Minister of Industry, Commerce and Technology.
The development represents the first phase of a major refurbishing programme being undertaken by the Factories Corpora-tion of Jamaica (FCJ) which is converting the 96,000 sq. ft. factory on a phased basis.
The first phase which is 30,000 sq. ft. was being rented for $300,000 a month, but the lack of interested persons has caused the Minister to lower the rate after discussion with the Factories Corporation of Jamaica (FCJ).
The new rental fee now stands at $135,000.
NEGOTIATIONS
"We have agreed to forgo the profit for the time been until we are able to get investors," he told The Sunday Gleaner. He continued: "I don't want to disclose much but we are currently in negotiations with a major call centre and they are expanding into Kingston to take up the offer."
In September 2002 at the launch of the Springfield project, Ambassador Anthony Hylton, the then Minister of Mining and Energy, said a tangible shift was taking place in the parish from an agricultural-based economy to one that was service-based.
But with the St. Thomas project hitting a snag, the Techno-logy Minister is banking on attracting renewed interest with lower rents.
"We have to be enticing investors in these area by offering them concessional rates. Once the investors are there it will pull others to the area," Mr. Paulwell said.
Another major concern the Minister said was whether the area could produce qualified workers, seeing that it was outside of Kingston.
"I have to be telling investors that it (St. Thomas) is a short distance away from Kingston and there are people in the area who are trained and would be able to work there," he added.
The Minister revealed that there is also another 50,000 sq. ft. in Naggo Head, Portmore, that is being completed in a month's time and already it has been rented out. The facility will create at least 1,500 jobs.
"I can say happily that all has been leased already before completion. It has been gobbled up," he said gleefully.
DOGGED BY CONTROVERSY
The information technology sector has been dogged by controversy, including questions over the Government's investing millions of dollars into several companies which have failed to repay the loans or create the projected number of jobs.
The six companies so far that have received funding under the Government's programme are Teleservices Jamaica, the New Kingston-based NetServ, Bay Telemarketing, based in Mon-tego Bay, Caytech Call Centre of Buff Bay, Portland, Jamaica Call Centre in Kingston and Montego Bay and Pathway Technologies in Kingston.
So far, Netserv in 2001 and Pathway on Friday, have been placed in receivership.
Minister Paulwell was reported as saying that all the companies have not performed with respect to the job commitments they gave.
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