Jamaica Highway 2000 Case Study
New Portmore Causeway
The RBTT loans had tenors of between 7-10 years and interest rates of between 10.85% and 11.5%. This would increase the financing costs of the project, and delay the receipt by NROCC of net cash returns.
Financial closing took place in October 2002, eleven months after commercial close. Construction commenced immediately thereafter and on Monday, September 22, 2003, the first leg of Highway 2000 was opened: a 13 kilometre stretch of road between Bushy Park in St Catherine and Sandy Bay in Clarendon. Subsequently Kingston to Bushy Park (21 km) was completed in December 2004, and the new Portmore-Kingston Causeway (5 km) in July 2006.
The Government’s cash contribution to the project, subordinated debt of USD99 million, was raised in large part by the issuance by NROCC of 30-year inflation-linked infrastructure bonds locally and internationally; a first for Jamaica. This bond carried a coupon of 4.5%, plus compensation for annual inflation based on movements in the Jamaican Consumer Price Increase (CPI). This bond was to be repaid from free cash flows from the project, following repayment of senior commercial lenders.
The financing structure for phase one is shown in Figure 5.
3.10 Traffic levels on the East-West Highway
The Highway immediately answered the question: will Jamaican drivers pay tolls? Traffic levels on the toll road commenced at about 10,000 vehicles per day, jumping to about 5060,000 with the opening of the Portmore Causeway in 2006, as shown in Figure 6 below. However there was one group of users that was clearly unhappy with the toll regime: residents of Portmore. On January 29, 2005, Portmore residents staged a horn-honking protest at plans for the toll road, followed by a louder one the following week. The residents
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