US embassy cable - 05KINGSTON1100

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 
 
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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. 
 
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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. 
 
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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