KINGSTON, Jamaica, July 31, CMC – One year after Jamaica placed an indefinite ban on the scrap metal trade following “widespread’ theft of metal across the island”, the Portia Simpson-Miller administration is to re-start the trade under new regulations.
Industry, Investment and Commerce Minister Anthony Hylton said the government is committed to re-instating the trade in the shortest possible time.
“We have taken every possible caution, dotted every ‘I’ and crossed every ’T’, checked, cross checked and re-checked, to ensure that we plug every loophole, create the barriers and impediments to unscrupulous individuals and companies, to get the industry up and running.
“This Ministry, this government, is pulling out all the stops to turn this economy around,” Hylton said, adding that among the new measures is the establishment of central scrap metal processing and loading sites, on a phased basis, to accommodate approved scrap metal exporters.
Last year, the government said the scrap metal theft had cost it and the private sector more than one billion dollars (US$11.7 million) over the past three years.
The Scrap Metal Federation of Jamaica had been lobbying for the sector to remain operational saying a shutdown would bankrupt most stakeholders in the industry.
According to the government, the Factories Corporation of Jamaica (FCJ) will be responsible to construct and operate a site at the Riverton City landfill/ dump. It is also to recover its capital outlay, estimated to cost J$40 million (US$451,977), from users of the facility.
Hyylton said centralising the operations woud provide for several advantages, including an improvement in the level and frequency of inspections and tighter and more effective management in the processing and loading of scrap.
He said this would result in a reduction in the quantity of stolen material and that competition among exporters would ensure that dealers and suppliers of scrap metal get a fair price, and private exporters will aggressively seek the best prices internationally, thereby ensuring that the country maximises its earnings from the trade.
He said that for purposes of regulation, the government places scrap metal into two categories – industrial and non-industrial.
Hylton said that under industrial scrap, companies will be permitted to export their own scrap metal, which will have to be exported in their (the company’s) name. Customs will have to inspect the loading, and a regulatory fee will be charged.
“Any proof of theft of scrap metal that is exported by the company, will result in stiff penalties and cancellation of the licence to export. The penalty will be $5 million (US$56, 497) and the company will have to post a bond of $5 million,” Hylton said.
He explained that non-industrial scrap will have to be exported from the central scrap metal processing and loading site. Exporters in this category will also face a fine of $5 million if they breach the regulations.
“My message to anyone who wishes to continue in the business of exporting scrap metal is: Stay far away from anything that could be questionable,” he said, adding that the objectives behind re-opening the trade are to create employment; earn foreign exchange; and clear derelict scrap from valuable space in order to clean the environment of unsightly scraps.
“These three objectives must be achieved, subject to the prevention of theft and destruction of functional metallic items and infrastructure,” he said, adding “there is money, serious foreign exchange to be made from the trade in scrap metal”.
Hylton said that the scrap metal trade, at one time, provided employment for an estimated 10,000 people among the lower socio economic group and earned foreign exchange at a peak of US$100 million in 2006.