flag Jamaica Jamaica: Investing

FDI in Figures

According to UNCTAD's 2021 World Investment Report, FDI flows to Jamaica accounted for USD 366 million in 2020, down from USD 665 million in 2019 (-45%), following the global economic crisis triggered by the Covid-19 pandemic. The FDI stock reached USD 17.5 billion in 2020, making Jamaica the largest recipient of FDI among small island developing states. The government sought to convince investors in business process outsourcing to keep their operations in the country. The sectors attracting the most FDI are the bauxite industry, telecommunications, tourism and construction. The United States, the United Kingdom and Canada are the main investing countries. Over 60 outsourcing firms operate in Jamaica, generating USD 700 million in revenue and employing roughly 40,000 persons, according to data from the Jamaican Government’s marketing agency, Jampro. As per the latest figures from the Bank of Jamaica, in the first three quarters of 2021 FDI inflows reached USD 233,6 million, marking a decrease of 14.7% compared to the same period one year earlier.

The country aims to become a logistical hub between North and South America, which requires the development of transport infrastructure (maritime, aviation, road and rail) and logistics. The Jamaican Government offers incentives such as easy payments methods, grace periods for tax payments and duty-free imports to foreign investors. The country has many assets, including its strategic geographical location, rich natural resources and a significant capacity to receive large numbers of tourists. Jamaica applies the principle of national treatment to foreign investors and does not impose limits or control on foreign ownership. However, under the Jamaican Companies Act, investors are required either to establish a local company or to register a branch office of a foreign-owned enterprise. No formal screening mechanisms exist for foreign investments. The government also established Special Economic Zones in which operators benefit from a 12.5% reduced corporate income tax rate; customs duty relief, General Consumption Tax relief; employment tax credit; promotional tax credit on research and development; capital allowance; and other incentives. Nevertheless, high criminality (e.g. security is required to protect the physical infrastructure of most properties and Jamaica's murder rate remains one of the highest in the hemisphere), a significant number of drug traffickers, corruption and the risk of natural catastrophes remain hindrances to FDI. Jamaica was ranked 71st out of 190 countries in the World Bank's latest Doing Business ranking, a four-spot rise from the previous edition.

 

Country Comparison For the Protection of Investors

  Jamaica Latin America & Caribbean United States Germany
Index of Transaction Transparency* 4.0 4.1 7.0 5.0
Index of Manager’s Responsibility** 8.0 5.2 9.0 5.0
Index of Shareholders’ Power*** 5.0 6.7 9.0 5.0

Source: Doing Business - Latest available data.

Note: *The Greater the Index, the More Transparent the Conditions of Transactions. **The Greater the Index, the More the Manager is Personally Responsible. *** The Greater the Index, the Easier it Will Be For Shareholders to Take Legal Action.

 
Foreign Direct Investment 201820192020
FDI Inward Flow (million USD) 775665366
FDI Stock (million USD) 16,566.717,232.117,538.1
Number of Greenfield Investments* 11.010.04.0
Value of Greenfield Investments (million USD) 38492936

Source: UNCTAD - Latest available data

Note: * Greenfield Investments are a form of Foreign Direct Investment where a parent company starts a new venture in a foreign country by constructing new operational facilities from the ground up.

 

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Tax Rates

Value Added Tax (VAT)
15% (standard rate).
25% for the provision of telecommunication services (including phone cards) and handsets.
10% for hotels and the tourism sector.
Several items are exempt, including: certain basic food items, certain energy-saving devices, prescription drugs, certain medical supplies, as well as certain construction, transportation, and financial and insurance services.
Zero-rated goods and services include: some agricultural and fisheries inputs, exported goods and services, and purchases by diplomatic and international organisations and foreign governments.
Company Tax
33.33%
Withholding Taxes
Dividends: 15% (residents)/25% (non-resident individuals)/33.33% (non-resident corporations); Interests: 25% (non-resident individuals; residents)/33.33% (non-resident corporations); Royalties: 0% (residents)/25% (non-resident individuals)/33.33% (non-resident corporations).
Social Security Contributions Paid By Employers
National Housing Trust (NHT): 3%
National Insurance Scheme (NIS): 3% on gross emoluments up to JMD 3 million with effect from 1 April 2021 (JMD 5 million from 1 April 2022)
Human Employment and Resource Training Trust (HEART): 3%
Education Tax: 3.50%
Other Domestic Resources
Jamaican Tax Administration
Overview of Jamaica's tax measures in response to Covid-19
Consult Doing Business Website, to obtain a summary of the taxes and mandatory contributions.
 
 

Individual Taxes

Income tax
Up to JMD 1,500,000 0% (for resident individuals)
JMD 1,500,000 - 6,000,000 25%
Above JMD 6,000,000 30%
 
 

Country Comparison For Corporate Taxation

  Jamaica Latin America & Caribbean United States Germany
Number of Payments of Taxes per Year 11.0 28.2 10.6 9.0
Time Taken For Administrative Formalities (Hours) 268.0 327.5 175.0 218.0
Total Share of Taxes (% of Profit) 35.1 46.8 36.6 48.8

Source: Doing Business - Latest available data.

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Investment Opportunities

Tenders, Projects and Public Procurement
Inter-American Development Bank, Tenders in South America
DgMarket, Tenders Worldwide
Setting Up a Company
Consult Doing Business Website, to know about procedures to start a Business in Jamaica.
Useful Resources
Jamaica Promotions Corporation (JAMPRO) 
 

Business Setup Procedures

Setting Up a Company Jamaica Latin America & Caribbean
Procedures (number) 2.00 8.00
Time (days) 3.00 25.22

Source: Doing Business.

 
 
 

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Latest Update: May 2022