Rail transport has a long history in Jamaica, the first railway was constructed in 1845. The island’s public passenger service was closed in 1992, had a brief revival in 2011 before again being closed in 2012. Last year, the minister of transport and mining, Robert Montague, announced an impending revitalisation of the island’s railway service focusing first on the Kingston metropolitan region.
A local PPP expert based in Jamaica explained, “The announcement is ambitious. You would need a fair amount of volume to justify bringing the rail back into operation. But I think logistically we must, it looks to me that the same issues that caused Rail India to get cold feet remain in that rather than put something on a truck and transfer it to the rail and then transfer it to a truck, just put it on a truck and the truck goes exactly where you want it to go.”
“The announcement is ambitious. You would need a fair amount of volume to justify bringing the rail back into operation.”
A local PPP expert based, Jamaica
Despite such logistical misgivings, Jamaica’s rail ambitions will need to be realised if it wants to get its products to market more efficiently. The impact of the reimplementation of the railway service is multi-sectoral and multidimensional, as it should help solve not only the problem of vehicular congestion, particularly in the more urban areas including the capital and Montego Bay, but it will also provide an economic inflow, boosting tourism – critically important, constituting 35% of the island’s GDP.
To make long-term economic sense, the railway revamp must be part of a larger logistics operation which will involve not just the railway, but a milieu of transport upgrades. Transport expansion should focus on establishing a rail line into the port and into the Portmore community. Developing direct rail connections for large manufacturers would also help to make logistics more efficient.
From a passenger point of view, right now the rail line goes into downtown Kingston, but for a lot of the passenger traffic, authorities will need to coordinate the public transport network and make some changes in the bus routing so that when somebody comes off a bus, they can easily get a train. “So, all those things really must be considered in a holistic manner to make sense. You need to take that wider look, rather than just focusing on the existing railway stations,” explains the PPP expert.
PPP transactions have a long, and mostly successful track record, in Jamaica and are useful tools in galvanising private sector investment in infrastructure as the PPP expert highlighted, “We operate toll highways, both our airports have operated on the concept, and we have private independent providers operating under this model.”
“[Jamaica] is a good environment for an international investor, but the question mark is whether the project itself can be profitable…”
A local PPP expert based, Jamaica
“I think the key issue is whether the transaction makes sense, but I think the environment is actually very good for infrastructure. There is financing even in the local market itself. There is a good framework, the government put proper agreements in place. So, it is a good environment for an international investor, but the question mark is whether the project itself can be profitable,” concluded the PPP expert.