Prime Minister Bruce Golding has declared his faith in future of manufacturing in Jamaica and says that there are areas in which producers here can compete with China's industrial juggernaut.

"I have always been a believer in the manufacturing sector," Golding was quoted by the Government's Jamaica Information Service (JIS) as telling a town-hall meeting in May Pen, Clarendon, Tuesday night.

"There are some people who figure that we can never compete with China, but I do not accept that, Golding said. "We may not be able to compete with them in everything, but there are things that we can do and things that only we can do."

The Jamaican leader did not give examples of the sectors in which Jamaica's producers can compete with Chinese manufacturers, but his public vote of confidence would be welcomed by Jamaica Manufacturers' Association (JMA) President Omar Azan, who has been on a campaign for strong government policy to shore up the industry.

Azan met with Golding to press his case of his battered, if not demoralised constituents, ahead of the PM's public remarks last week.

Two decades ago, Jamaica's manufacturing sector accounted for over 15 per cent of gross domestic product (GDP) and employed more than 100,000 people.

manufacturing in retreat

But with the removing of protection as the market has been liberalised, manufacturing here has been in retreat. It now accounts for around 8.5 per cent of GDP.

Moreover, in recent years the sector has mostly contracted posting, for instance, a decline of 1.2 per cent in 2008. It is expected to contract by at least the same level this year despite JIS quoting Golding as saying that the sector had taken "a positive turn".

According to Golding, part of the problem facing Jamaican manufacturers is the cost of inputs, a fact which Azan's organisation often blame on interest rates being out of whack with the financing costs of their competitors.

High energy costs, public-sector bureaucracy, low labour productivity and old machinery, most experts say, also contribute to Jamaica's uncompetitiveness

Golding, in Wednesday night's remarks, told his May Pen audience that the Government would doing everything possible to support the sector, especially those engaged in small businesses.

most employed to small businesses

"The majority of people who have a job in Jamaica are employed to small businesses," he said.

He added: "They are what hold the economy together and we want to support them as much as possible by facilitating access to funds and by providing institutional support. Many of them fail because they don't fully understand how to run a business and how to manage money."

Among the administration's effort at supporting businesses generally and small ones in particular is by the provision of credit-reporting arrangements that will help to facilitate banking credit, enabling owners to get money from banks.

The laws would also be changed, Golding said, to to allow banks to treat as collateral things that they never accepted before.