Managing director of the beverage-producing company, Ricardo Nuncio, at a press conference held at Red Stripe’s Spanish Town Road offices yesterday, stated that the company will be investing five million euro this year to have production operations shifted from the United States to Jamaica.
The decision also means that Red Stripe will increase its current beer production by 30 per cent to meet the 48,000 tonnes required to supply the export market. The Jamaican beer is supplied to more than 25 markets around the world.
In 2012, Red Stripe moved the production of beer destined for North America from its plant in Kingston to City Brewing in Pennsylvania, USA, under a licensed production model for the North American market, similar to one operated in the United Kingdom for more than 30 years. As part of the agreement, Red Stripe was guaranteed royalties on each bottle sold.
Jamaica Observer that it was a “tough decision” to move the production operations from Jamaica, but “continuing on this path is going to end up one place — a company that is weaker overall”.
Following the acquisition of a controlling stake by Heineken in Desnoes and Geddes, there is renewed confidence that repatriating beer production to the local market will allow for more competitiveness and consistent high-quality production. What’s more, the company believes that Jamaica’s improvement in macroeconomic conditions are enough to re-establish the country as the global hub for the iconic brand.
“The Government levelled the playing field for taxation on alcoholic beverages and what that did was allow us to compete without our hands tied behind our back. And if you look at the productions you will see that our production and our sales have risen,” Byles stated yesterday.
“Jamaica is a more competitive country today on the world market today than it was three years ago. In bringing back production it’s going to bring back jobs and that is vitally important for Jamaica. Jobs here, jobs, at the ports and in agriculture for the production of cassava,” he continued.
The realignment by Desnoes and Geddes, company officials said, could result in the creation of approximately 300 additional direct jobs, and 3,000 indirect jobs through spin-off industries by 2017. Currently, Red Stripe employs close to 300 workers.
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