Identifier
Created
Classification
Origin
05KINGSTON1100
2005-04-22 21:06:00
UNCLASSIFIED
Embassy Kingston
Cable title:  

KINGSTON POL/ECON ROUNDUP: APRIL 1-21, 2005

Tags:  PGOV PREL EFIN ECON JM KCOR KCRM EINV EAID ELAB 
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UNCLAS SECTION 01 OF 04 KINGSTON 001100 

SIPDIS

STATE FOR WHA/CAR (BENT) AND WHA/PDA
STATE ALSO FOR INL/LP, EB/TPP, AND EB/IFD
STATE ALSO FOR CA/OCS/ACS/WHA (HALDANE)
STATE PASS OPIC FOR TABERNAKI
CUSTOMS MIAMI FOR LOWEN AND MAHABIR
SANTO DOMINGO FOR FCS, FAS, AND LEGATT
STATE PASS USTR FOR A. GASH-DURKIN
DOJ FOR OPDAT (LIPMAN)
TREASURY FOR L LAMONICA

E.O. 12958: N/A
TAGS: PGOV PREL EFIN ECON JM KCOR KCRM EINV EAID ELAB
SUBJECT: KINGSTON POL/ECON ROUNDUP: APRIL 1-21, 2005


UNCLAS SECTION 01 OF 04 KINGSTON 001100

SIPDIS

STATE FOR WHA/CAR (BENT) AND WHA/PDA
STATE ALSO FOR INL/LP, EB/TPP, AND EB/IFD
STATE ALSO FOR CA/OCS/ACS/WHA (HALDANE)
STATE PASS OPIC FOR TABERNAKI
CUSTOMS MIAMI FOR LOWEN AND MAHABIR
SANTO DOMINGO FOR FCS, FAS, AND LEGATT
STATE PASS USTR FOR A. GASH-DURKIN
DOJ FOR OPDAT (LIPMAN)
TREASURY FOR L LAMONICA

E.O. 12958: N/A
TAGS: PGOV PREL EFIN ECON JM KCOR KCRM EINV EAID ELAB
SUBJECT: KINGSTON POL/ECON ROUNDUP: APRIL 1-21, 2005



1. This week's topics:

-- Golding Wins By-Election in Peaceful Day of Voting
-- Violence in West Kingston Follows Golding Election
-- Phillips Steps Up Crime-Fighting Measures
-- Tourism Industry Resists Government Price Hikes
-- Unions Seek Increased Benefits for Sugar Workers
-- Chinese Railway Rehabilitation Back on Track
-- Jamaica's Tele-Density Soars
-- Foreign Firms Repatriate Profits
-- JD$1 Billion Issued in Ivan Aid, Says ONR

-------------- --------------
Golding Wins By-Election in Peaceful Day of Voting
-------------- --------------


1. In the West Kingston parliamentary by-election on April
13, the Jamaica Labor Party's (JLP) Bruce Golding handily
defeated the People's National Party's (PNP) Joseph "Bunny"
Witter by a margin of 8,225 votes to 1,079 to claim the seat
held for the past 43 years by former JLP leader and prime
minister Edward Seaga. Golding, who resigned from the Senate
a few weeks ago, formally became Leader of the Opposition
when he was sworn in at Parliament on April 21. By prior
arrangement, JLP's Kenneth Baugh has been Leader since Edward
Seaga's resignation in January. Golding's landslide victory
was widely expected in the fiercely loyal JLP constituency.


2. Polls opened at 0700 and closed at 1700. Pol/Econ Chief
and Poloff (accompanied by eight heavily armed Jamaica
Constabulary Force (JCF) officers who honored their official
orders not to enter polling stations) visited a number of
voting stations in inner city West Kingston, including Tivoli
Gardens, Denham Town, and Hannah Town. Electoral Office of

Jamaica (EOJ) officials manning booths almost uniformly
reported initial technical problems with the fingerprint
scanners being used for the first time to identify voters,
but all said that the problems were worked out early in the
day. Only JLP green was evident in Tivoli Gardens, the heart
of Seaga's former constituency and Jamaica's prototypical
"garrison" community, although emboffs did see JLP supporters
mixing peacefully with PNP supporters in their party's
traditional orange in the other communities they visited.
Official observers from Citizens' Action for Free and Fair
Elections (CAFFE),a local NGO, monitored the voting. At
many stations, EOJ officials reported that voting had been
somewhat slow, although they expected it to pick up later in
the afternoon as voters stopped by the polls on their way
home from work. On April 14, The Gleaner reported only a 53
percent turnout, as opposed to 81 percent in 2002 general
elections.

-------------- --------------
Violence in West Kingston Follows Golding Election
-------------- --------------


3. On April 14, the day after Golding's West Kingston
victory, local firemen discovered the charred remains of two
men, both shot in the head, in the constituency. Their
bodies had been hacked to pieces, stuffed into a barrel, and
set alight. Although the police investigation is still
ongoing, political leaders were quick to politicize the
murders. The PNP issued a statement denouncing the violence,
while Golding blamed the PNP, speculating on rumors that PNP
supporters killed the men because they had voted for Golding
at the polls. On April 20, hundreds of residents took to the
streets in protest against the killing of a local resident
(and suspected murderer) by a joint police/military patrol.
Residents blocked roads, local schools were closed, and more
than 100 rounds of ammunition were fired in the vicinity of
the Denham Town police station as Golding urged calm in his
community. The Bureau of Special Investigations was called
on to investigate the incident. The events in West Kingston
represent instability in a community said have been mostly
free of political violence for several years. Embassy
sources speculate that the problems stem from an attempt to
solidify political allegiances in the area, where three out
of four communities are fiercely aligned with the JLP, while
the fourth is not.


--------------
Phillips Steps Up Crime-Fighting Measures
--------------


4. Before dawn on April 6, members of the JCF and Jamaica
Defense Force (JDF) swept into violence-plagued Spanish Town
to implement a four-day curfew to &neutralize gunmen8 and
criminal gangs operating in the area. Authorities said that
600 police officers and 200 soldiers were involved, searching
houses, cars, and pedestrians in communities plagued by
violence caused by the feuding One Order and Klansman gangs.
The JCF detained 83 people in the first day of the raid.
Golding highly criticized the roundups, which he likened to
"Afghanistan" and "Nazi Germany." Only two weeks earlier,
Minister of National Security Peter Phillips, a candidate to
succeed Prime Minister P.J. Patterson, called out the
National Reserve to augment security forces in
violence-ridden neighborhoods. A similar operation is
planned in certain Montego Bay communities.


5. (U) During his contribution to the parliamentary budget
debate on April 20, Phillips announced the planned
implementation of measures that will modernize the force's
technical capabilities. He described a management
information system in which police stations will receive
computers linked by a wide area network, fingerprint
collection will be digitized, ballistics investigations will
be computerized, and patrol cars will be able to access
police databases. Phillips also announced the establishment
of a two-year, J$200 million (USD 3.3 million) Community
Security Fund to support crime-fighting efforts in
violence-prone communities through social services designed
to loosen the grip that gang leaders have on these areas.
Approximately 500 people have been murdered thus far in 2005,
a more than 40 percent increase over 2004,s record-breaking
murder rate.

-------------- --
Tourism Industry Resists Government Price Hikes
-------------- --


6. (SBU) Minister of Industry and Tourism Aloun Assamba
announced that the Government will introduce a Tourism
Enhancement Fee on May 1. The fee, USD 10 for airline
passengers and USD 2 for cruise ship travelers, is expected
to fund the sustainability of Jamaica's tourism industry, and
forms part of the Tourism Master Plan developed by a special
tourism task force. The announcement drew harsh criticism
from members of the tourism sector, including hotel mogul
John Issa of Super Clubs, who complained that the fee only
adds to the already burdensome level of tourism taxation.
Assamba responded, "I am not taxing the hoteliers, attraction
owners, or the Jamaican people. I am asking the visitors
coming into the island to contribute to the enhancement and
the sustainability of the tourism product.8 The fee will
come in addition to Finance Minister Omar Davies, proposed
two percent tax hike on hotel services. Davies proposed
2005/2006 fiscal budget, presented on April 14 (septel),
includes an increase from 6.25 to 8.25 percent of the general
consumption tax (GCT) on hotel services. The proposal is
drawing widespread criticism from hotel and tourist
associations, who fear that the cost increase will be borne
by local hotel and tour operators, and not tourists. One
Embassy contact speculated that taxing hoteliers in this
manner is at least partially directed at top Jamaican
hotelier Gordon "Butch" Stewart. The well-connected Stewart
ran Air Jamaica, the national carrier, for ten years until
control of the quality-challenged, heavily indebted airline
returned to the GOJ in late 2004.

-------------- ---
Unions Seek Increased Benefits for Sugar Workers
-------------- ---


7. Speaking against the backdrop of the March 31 accidental
death of a worker at the Long Pond Sugar Factory in Clarks
Town, Trelawny, Lambert Brown, vice-president of the
University and Allied Workers Union (UAWU),said he wants the
disparity between benefits paid to sugar workers and prison
guards who die on the job to be reviewed quickly by the
government through its trade union laws. "If a prison warder
dies on the job, his beneficiary is guaranteed $4 million,"
said Mr. Brown. "However, if a sugar worker dies, his
beneficiary will get less than $50,000." On April 21, an
employee of the Appleton Sugar Factory died in an accident.

--------------
Chinese Railway Rehabilitation Back on
Track -------------- --------------


8. A Chinese engineering firm is set to conduct a feasibility
assessment for the rehabilitation of the country's rail
service, following the signing of a MOU between the Chinese
and Jamaican governments in February 2005. Transport and
Works Minister Robert Pickersgill reported that discussions
have begun with the vice president of China's CAMC
Engineering, Wang Yuhang, who recently visited the island.
Pickersgill said that CAMC has subsequently advised the
National Investment Bank of Jamaica (NIBJ) that it is
interested in reviving the railway system. The engineering
company has also written to the NIBJ seeking technical and
financial information for its assessment.

--------------
Jamaica's Tele-Density Soars
--------------


9. Jamaica's tele-density (telephone lines per capita) has
jumped from 30 percent to over 80 percent since
liberalization of the market five years ago. The island's
1.8 million cellular users and 500,000 landlines place it
among the upper access category of the International
Telecommunication Union's Digital Access Index. Technology
Minister Philip Paulwell said that this achievement gives
Jamaica a competitive edge for investment in general and
information and communication technology activities. He also
stated that Jamaica could dominate the Caribbean region in,
among other things, call centers, software development, data
conversion and imaging, and distance education programs.

--------------
Foreign Firms Repatriate Profits
--------------


10. Data released by the Bank of Jamaica showed that foreign
companies operating in Jamaica repatriated just under USD 500
million between April and November 2004. This represents a
22 percent increase relative to the same period in 2003. The
increased remittances are not surprising given that Jamaica
has enjoyed strong private capital inflows in recent years
and projections are that this trend will continue. The
leading remitters of profits were Bank of Nova Scotia,
Desnoes and Geddes (producers of spirits),National
Commercial Bank, Cable and Wireless, and bauxite/alumina
companies.

--------------
J$1 Billion Issued in Hurricane Aid, Says ONR
--------------


11. As its mandate nears completion, the Office of National
Reconstruction (ONR) said it has directly spent just under
J$1 billion (USD 16.4 million) to assist various Jamaican
institutions and citizens affected by Hurricane Ivan. The
ONR, which was set up days after Ivan hit Jamaica on
September 11, 2004, said it has coordinated J$3.5 billion
(USD 57.4 million) in relief aid targeting schools, housing,
the agricultural sector, and public buildings. In addressing
the press briefing, ONR Director Danville Walker said most of
the relief fund has been used to repair 50 schools and assist
approximately 32,000 farmers out of more than 80,000 requests
from farmers.
TIGHE