Bond money hurting scrap metal dealers
KINGSTON — When the scrap metal trade resumed today, a number of dealers were left out in the cold because of a prohibitive $7-million bond, which exporters are required to pay.
Jonathan Aarons, president of the Scrap Metal Federation, told The Gleaner yesterday that it was likely that a number of exporters were going to pull out of the trade because of the difficulty of coming up with the money.
“It is going to be difficult for most exporters because the levy is extremely high. (There are) approximately 40 exporters now, but we can’t tell, with this bond, how many of those 40 will remain as exporters,” Aarons said.
Under the new regulations announced last week, all exporters, except those who generate metal waste in their manufacturing operations, will be required to post the bond with the Factories Corporation of Jamaica, which is the agency overseeing the designated sites.
The intent is to apply a portion of the bond towards compensation of victims of theft, according to Industry, Investment, and Commerce Minister Anthony Hylton.
Aarons said his association had engaged Hylton in discussions with a view to lowering the bonds and was surprised by the announcement of the $7-million bond.
He said while some exporters were in negotiations with the bank to use their properties as collateral, they were still facing difficulties because of the tardiness of the ministry.
“Most of the banks, when they would write such a bond, they need to know the criteria for which the bond is going to be written. We requested from the ministry a template document to take to the bank, and we didn’t get such documentation until Friday.
“If the ministry had acted expeditiously in providing us with the template, then I think most of us would have the bond in our hands today.” (Gleaner)