CARICOM Business, Volume 5, No. 44

CARICOM Business – Vol. 5 No. 44
CARICOM Business
A weekly aggregation of some of the more topical business news occurring in or likely to impact CARICOM / Caribbean
Big airlines reap US$2 billion in profits
The three biggest United States airlines have reaped a combined profit of more than US$2 billion despite the 43% leap in airfares over the past year. American Airlines said that it earned US$483 million on record-breaking revenue that more than offset higher fuel costs in the third quarter. United Airlines reported a US$942 million profit, and Delta Air Lines posted third-quarter earnings of US$695 million. Executives at all three big US airlines said they see no indication that consumer concerns about inflation and the economy are hurting ticket sales. “American’s third-quarter results, including our record revenue performance, are significant considering the macroeconomic uncertainty facing so many people,” CEO Robert Isom said on a call with analysts and reporters. “Demand remains strong.” American, which is based in Fort Worth, Texas, predicted that fourth-quarter profit will be between 50 cents and 70 cents per share, which would beat Wall Street’s forecast of 19 cents per share. US air travel has roared back from pandemic lows in early 2020. The Transportation Security Administration screened nearly 2.5 million travellers on a single day on a Sunday in October, the busiest day at the nation’s airports since February 2020. One reason fares are high is that the number of flights has not returned to pre-pandemic levels, leaving consumers vying for fewer seats. American, for example, did nearly 10% less flying in the third quarter than in the same period of 2019. American said it plans to run at 95% to 100% of 2019 levels next year. That is in line with Delta, which expects to restore its full schedule by next summer. United recently announced it will expand European flying next summer. (JG)
Guyana: Oil production to reach 1M bpd by 2030
The 3 biggest US airlines have reaped a combined profit of more than US$2 billion despite the 43% leap in airfares over the past year. American Airlines said that it earned US$483 M on record-breaking revenue that more than offset higher fuel costs in the 3rd quarter. United Airlines reported a US$942 M profit, and Delta Air Lines posted third-quarter earnings of US$695 M. Executives at all 3 big US airlines said they see no indication that consumer concerns about inflation and the economy are hurting ticket sales. One reason fares are high is that the number of flights have not returned to pre-pandemic levels. For example, American, did nearly 10% less flying in the 3rd quarter 2022 vs 2019. (JG)
Foreign Exchange Summary
Applicable rates as at October 28, 2022Applicable rates as at October 28, 2022
Barbados grows by 10.1%; earns $508.2 million from tourism
Tourism is leading the way as the Barbados economy recovers from the COVID-19 pandemic with the sector contributing an estimated $508.2 million to economic activity for the first nine months of 2022. In delivering his quarter economic review, Central Bank Governor Cleviston Haynes also advised that the economy grew by 10.1% in the first 9 months of this year, including 9.8% growth between July and September. The forecast is for the economy to grow by 10% this year overall, followed by growth between 3.5% and 5% in 2023. In addition to expanded Gross Domestic Product (GDP), Barbados main economic indicators were inflation of 7.8%, unemployment of 9.3%, international reserves of $2.8 billion, a primary surplus of about $368 million, and Gross Public  Sector Debt of 126.6% of GDP. Tourism arrivals as at September 30, reached 302 863, some 58% of 2019 levels relative to the 239 639 visitors recorded for the first 9 months of 2021. Occupancy levels averaging 59% for the first 9 months of 2022, and was 9.5% less than the same period in 2019. The UK accounted for 71% of 2019 arrivals, USA (56%) and Canada (49%) over the corresponding 9 month period in 2019. (NN) (BT)
Corporate Movements
JMMB Group Limited has appointed Shuchane Johnson as JMMB Jamaica Country Compliance Officer effective October 3, 2022; MPC Caribbean Clean Energy Limited has appointed Lisl Bettina Lewis has been appointed as a Director effective 25th October, 2022;tTech Limited has announced the resignation of Chief Executive Officer (CEO) Christopher Reckord. Reckord effective November 30;Shiraz Hamid has been appointed the branch manager of South Park Branch for JMMB Bank (T&T) Limited effective October 1;Damion Brown has resigned as JMMB Group Limited’s Chief Investment Officer, effective November 25.
T&T’s 2022 deficit cut to 0.2% a 14 year low
The Ministry of Finance has reported that T&T’s deficit for the 2022 fiscal year, which ended on September 30, 2022, has been revised downwards to 0.2% of Gross Domestic Product (GDP). According to the Ministry of Finance, total revenue for fiscal 2022 has been determined to be $54.21 billion, “which is $2.57 billion more than the revised estimate announced in September 2022, and $10.88 billion more than the original revenue estimate of $43.33 billion for fiscal 2022, made in October 2021.” It added that with total expenditure for fiscal 2022 now estimated at $54.54 billion, the fiscal   deficit for 2022 is now estimated at $329 million, which is less than 0.2% of GDP, well below the international benchmark for fiscal deficits of 3% of GDP. “In essence, we have achieved an almost balanced national budget in Fiscal 2022, something that has not occurred in Trinidad and Tobago since 2008, 14 years ago,” said the Ministry of Finance. (TE)
EU agrees on effective ban of new fossil fuel cars from 2035The European Council and the Parliament reached a provisional political agreement on stricter CO2 emission performance standards for new cars and vans. A 100% CO2 emission reduction target for new cars and vans is to become effective from 2035, representing an actual ban on the sales of gasoline and diesel vehicles. The agreement also includes a 55% CO2 emission reduction target for new cars and 50% for new vans from 2030 compared to 2021 levels, much higher than the existing target of a 37.5% reduction by then. The agreement includes wording on CO2 neutral fuels, whereby the European Commission will make a proposal for registering vehicles running exclusively on CO2-neutral fuels after 2035.The agreement also includes a number of other provisions, including:A reduction of the cap of emission credits that manufacturers can receive for eco-innovations that verifiably reduce CO2 emissions on the road, to up to 4 g/km per year from 2030 until 2034 (currently set at 7 g/km per year).The regulatory incentive mechanism for zero- and low-emission vehicles (ZLEV) will be kept until 2030. As part this mechanism, if a manufacturer meets certain benchmarks for the sales of zero- and low-emission vehicles it can be rewarded with less strict CO2 targets. The co-legislators agreed to increase the benchmark to 25% for cars and 17% for vans until 2030.A review clause will ensure that in 2026, the Commission assess the progress made towards achieving the 100% emission reduction targets and the need to review these targets taking into account technological developments.The Commission will develop a common EU methodology, by 2025, for assessing the full life cycle of CO2 emissions of cars and vans placed on the EU market, as well as for the fuels and energy consumed by these vehicles. Based on this methodology, manufacturers may, on a voluntary basis, report to the Commission on the life cycle emissions of the new vehicles they place on the market.The agreement maintains a derogation for small volume manufacturers until the end of 2035.The proposal revises existing rules, last amended in 2019. The text of the provisional political agreement will be made available soon, the European Council said in a press release. The provisional political agreement reached in trilogue negotiations will now have to be formally adopted by the Council and the Parliament. (DN)
Travel data firm predicts 19% tourist arrivals growth for Caribbean in Q4Travel to the Caribbean is up 19% in the fourth quarter, compared to the same period in 2019 according to information from travel data analytics provider Forward Keys. Dominican Republic and US Virgin Islands are leading the pack, with 40% and 33% growth respectively in the fourth quarter. The Bahamas and Jamaica are 8th and 9th on the list with projected growth of 15% and 8% respectively. Turks and Caicos Island’s is expected to record 21% growth this quarter. The US and Canada remain the largest source market to the Caribbean at 73 percent, 19 percent higher than 2019 numbers. Latin America and the Caribbean are at 10 percent this quarter, up 21 percent over the same period in 2019. However, there is an upsurge in new categories of travellers with Premium cabin travel to the Caribbean in Q3 is up 27% versus the pre-pandemic. Curacao and Bonaire, have already realised triple-digit increases versus 2019 levels with increases of 120% and 110% respectively. A further sign that times are changing is that affluent travellers are flying from both North America and more recently, South America. In Q4 the Caribbean is extremely popular with Colombians. There is a 54% change in arrival numbers versus the same time in 2019. While Curacao can see a +304% change from Argentina. Lastly, some Caribbean destinations are even managing to attract the non-leisure market. Throughout the region, business travel is returning and in growth mode. Saint Lucia is up by 22% in business travellers in Q4 this year versus 2019 levels, an achievement as the destination has tried hard to interest more business events. (NG)
Caribbean travel outlookIn Q4, the Caribbean is clearly shifting to “Growth Mode” International worldwide arrivals in Q3 and Q4 2022, as of 14 September; vs 2019 levels
Barbados records $368 million fiscal surplus for the first six months of the fiscal year, there was a significant improvement in Barbados’ fiscal  accounts. Preliminary data indicates that the primary balance, which excludes interest expenditure, registered a surplus of $368 million, enabling an overall positive fiscal balance for the period. The more than ten-fold increase in the primary balance reflects the combined effects of the inflation dividend caused by rising prices and the containment of non-interest spending. Revenue growth is anticipated to slow while expenditure, particularly on capital works, is anticipated in the second half of the year, resulting in an overall primary surplus equivalent to approximately 2 percent of GDP.  Total revenues rose by $254 million, on the strength of broad-based increases in tax revenues. VAT receipts grew by $86 million due to the pick-up in domestic economic activity, higher imports and a reduction in transfers for current year refunds to the Barbados Revenue Authority (BRA). The higher imports also led to import duties rising by $16 million but excises and the fuel tax incurred a cumulative decline of $22 million, in part due to timing differences in the transfer of taxes by the Barbados National Oil Company. Non-interest expenditure declined by $78 million given one-off capital spending occurring during the previous fiscal year, including the recapitalisation of the NIS ( $50 million) and the purchasing of roll-out carts under the Sanitation Service Authority ($18 million). Grants to public institutions also registered a $27 million decline given a shift in the timing of transfers to some SOEs while grants to individuals contracted by $7 million during the period. Goods and services rose by $47 million as spending on property maintenance, general operating expenses and utilities increased over the period. Wages and salaries remained broadly in line with the previous fiscal year while spending on interest payments increased as the step-up interest rate feature on domestic bonds commenced. (CBOB)
Review of Barbados’ Economic Performance (Jan – Sept. 2022)The Barbados economy continues to recover, as reflected in the double-digit growth achieved for the first nine months of 2022. During the third quarter, the resurgent tourism sector helped to catalyse economic activity and restore employment levels. The economy is not yet producing at pre-pandemic levels but, based on encouraging forward bookings, tourism is expected to sustain its rebound for the remainder of the year.
Bermuda’s life reinsurance business grew to $539bn in 2021US life insurers cede more than a half a trillion dollars in annual premiums to Bermuda’s long-term reinsurers, and a new study claims it has become a source of industry concern. In fact, Bermuda was by far the largest foreign reinsurance destination for US life insurers and accounted for just over a third of total ceded life and annuity reserves at year-end 2021, the report has revealed. Total L&A reserves ceded to Bermuda companies grew from more than $424 billion in 2020 to nearly $539 billion in 2021. The report said ceded life insurance and annuity reserves to Bermuda was still growing from one third of total business ceded by US life insurers at year-end 2021. And some insurance groups use it to a much greater degree than average. The ceded life and annuity reserves to Bermuda at year end 2021 had grown to 33.62% of the total, up from 26.19% the year before. As the Bermuda portion grew, the US portion fell from 68.15% in 2020 to 59.35% in 2021.No other country was close. The next was Cayman Islands, which took in just less than 3% of total US ceded life and annuity reserves. The report concludes: “With a sizeable and growing volume of business ceded outside the purview of US regulators, there is increasing concern among some industry participants regarding this practice. (RG)
Cayman’s fund industry resilient amid economic headwindsCayman’s fund industry has shown continued strong fund formations in the face of high volatility, record inflation and a growing likelihood of an economic recession. In the third quarter of 2022, Cayman added a net number of 81 mutual funds and 319 private funds, growing the total number of active funds by 0.2% and 2.1%, respectively. Since the beginning of the year, the total of mutual funds registered with the Cayman Islands Monetary Authority increased by 297 to 13,016, or 2.3%, while the number of private jumped by 983 to 15,662, or 6.7%. The slowing growth of mutual fund formations in Cayman in the third quarter reflects the international trend for hedge funds. Hedge Fund Research estimated in September that the number of new hedge fund launches fell to only 80 in the second quarter, down from 185 in the first three months of this year. According to the data provider, institutional investors withdrew about US$26 billion from hedge funds in the third quarter as the total estimated global hedge fund industry capital fell to $3.78 trillion. The average industry-wide hedge fund management fee was unchanged from the prior quarter at an estimated 1.36% but is at the lowest level since 2008, when HFR began publishing these estimates. The average incentive fee increased narrowly by 2 bps to 16.05% in the second quarter. (CC)Regulations drafted to combat financial crimes via wire transfers it strives to keep pace with evolving international practices, the government of the Bahamas  intends to soon pass into law new regulations to combat financial crimes conducted through wire transfers, Attorney General Ryan Pinder has said. “We have finalized Financial Transactions Reporting (Wire Transfers) (Amendment) Regulations, 2022 that will soon go to Cabinet and be executed into law. These regulations keep pace with the ever-changing framework of AML [anti-money laundering] rules in the digital asset space by setting a framework to implement the “travel rule”. The travel rule prescribes how financial institutions should implement a variety of policies and procedures to combat wire transfer-related financial crime,” Pinder said in the Senate recently. “Particularly, the travel rule addresses what information related to both originators and beneficiaries of cross border transactions should be obtained, maintained, and shared between financial institutions, supervisory authorities, and law enforcement, relevant to wire transfers. These requirements also apply to cross border digital asset transfers and are currently addressed in the regulations. Keeping pace with implementing international best practices is good governance.” Pinder was speaking during debate on the Automatic Exchange of Financial Account Information (Amendment) Bill, 2022. (NG)Belize: Imports up 32.5% but exports lag by 14.6% Merchandise imports in Belize for the period, January to September 2022, amounted to $1.992 billion, representing a 32.5% or $488.2 million increase from the same period last year, when imports totalled $1.503 billion.  This was led by Mineral Fuels and Lubricants imports, which increased by 83.9 percent or $153.4 million, from $182.7 million to $336.1 million, the combined effect of higher world market prices and increased quantities of kerosene and regular gasoline being imported. Merchandise exports for the period January to September 2022 totalled $383.4 million, up 14.6% or $48.8 million from $334.6 million for the same period last year. Earnings from sugar rose by $18.5 million during the period, from $120 million in 2021 to $138.5 million in 2022, as the country exported larger quantities of this product at more favourable prices. On the other hand, bananas export earnings declined by 6.0% to $62.8 million relative to the corresponding period of 2021. Exports of red kidney beans also declined, falling by $1.5 million from $9.9 million to $8.5 million, while sales of black-eyed peas declined by $1.2 million from $3.8 million in 2021 to $ 2.6 million in 2022. (SIB)GLOBAL ECONOMIC NEWS IN BRIEF
German economy grows 0.3% in Q3Germany’s Gross Domestic Product (GDP) adjusted for price, seasonal and calendar variations in the third quarter of 2022 was 0.3% higher in comparison to the previous three-month period, the country’s Federal Statistical Office Destatis said in a report released on Friday. “After the slight increase seen in the second quarter of 2022 (+0.1%), the German economy managed to hold its ground… The economic performance in the third quarter of 2022 was mainly based on private consumption expenditure,” it was said in the report. Adjusted for price, the GDP expanded by 1.1% on an annual basis for the third quarter of 2022. Economic growth in the third trimester of 2022 was 0.2% higher compared to the fourth quarter of 2019, making it the first time economic activity topped the pre-coronavirus pandemic levels.Bank of Japan keeps ultra-low interest ratesThe Bank of Japan on Friday kept its ultra-low interest rates, but raised its inflation forecast through 2024. The BoJ held its key short-term interest rate unchanged at -0.1% and for 10-year bond yields around 0% at its October meeting, in line with market forecasts. The Japanese yen stabilized on the day around 146.25 per dollar after falling 0.4% following the move. The yen rose 4% from last week’s 32-year low of 151.94. “The Bank will continue with Quantitative and Qualitative Monetary Easing with Yield Curve Control, aiming to achieve the price stability target of 2 percent, as long as it is necessary for maintaining that target in a stable manner,” it said in a statement. In its quarterly outlook report, the bank revised its inflation forecasts upwards by 0.6 percentage points to 2.9% for the year ending in March due to surging costs of energy, food, and durable goods. Inflation is expected to ease to 1.6% over the next two years, below its inflation target of 2%. The bank cut its Gross Domestic Product (GDP) growth forecast for fiscal 2023 and 2024, to 2% and 1.9%, respectively. According to data out earlier on Friday, consumer prices in Tokyo surged at the fastest pace since 1989 with 3.4% in October, higher than forecasts.US economic growth rebounds in Q3 on trade, but demand is slowingThe US economy grew at a 2.6% annualised rate in the third quarter, the US Commerce Department said in its advance GDP estimate on Thursday, ending two straight quarterly decreases in output, which had raised concerns that the economy was in recession. The economy contracted at a 0.6 per cent pace in the second quarter. While the economy may not be in recession, the risks of a downturn have increased as the Fed doubles down on rate hikes as it fights the fastest-rising inflation in 40 years. The US central bank has raised its benchmark overnight interest rate from near zero in March to the current range of 3.00 per cent to 3.25 per cent, the swiftest pace of policy tightening in a generation or more. The trade deficit narrowed sharply in part as slowing demand curbed the import bill. Exports also increased for much of last quarter. Wild swings in trade and inventories were behind the contraction in GDP in the first half of the year. Growth in consumer spending, which accounts for more than two-thirds of U.S. economic activity, slowed to 1.4 per cent rate from the April-June quarter’s 2.0 per cent pace.ECB raises interest rates by 75 basis points to fight record inflationThe European Central Bank raised its interest rate benchmarks by three-quarters of a percentage point at a meeting in Frankfurt, matching its record increase from last month and joining the US Federal Reserve in making a series of rapid hikes to tackle soaring consumer prices. Inflation remains far too high and will stay above the target for an extended period, the bank said in a statement. The ECB has now raised rates for the 19-country euro area by a full 2 percentage points in just three months, distance that took 18 months to cover during its last extended hiking phase in 2005-2007 and 17 months in 1999-2000. The ECB foresees inflation falling to 2.3% by the end of 2024. The ECB’s benchmark for short-term lending to banks now stands at 2%, a level last seen in March 2009. Central banks around the world are rapidly raising interest rates that steer the cost of credit for businesses and consumers. Their goal is to halt galloping inflation fueled by high energy prices tied to Russia’s war in Ukraine, post-pandemic supply bottlenecks, and reviving demand for goods and services after COVID-19 restrictions eased. The US Federal Reserve raised rates by three-quarters of a point for the third straight time last month.Growth in Asia-Pacific region to slow down in 2022, 2023, says IMFThe International Monetary Fund (IMF) said in a report released on Friday that economic growth in the Asia and Pacific region is expected to slow down in 2022 and 2023. This reflects headwinds from several aspects, including global financial tightening and the Russia-Ukraine war, Xinhua news agency quoted the report as saying. Asia’s strong economic rebound early this year is losing momentum, with a weaker-than-expected second quarter, said the IMF. It cut growth forecasts for Asia and the Pacific to 4 per cent this year and 4.3% next year, down by 0.9 and 0.8 percentage points, respectively, compared to the April forecasts. The levels in April’s outlook were well below the 5.5% average over the last two decades. However, Krishna Srinivasan, director of the IMF’s Asia and Pacific Department, believed that “Asia remains a relative bright spot in an increasingly dimming global economy”. Srinivasan said that for policymakers, further tightening of monetary policy will be required to ensure that inflation returns to target and inflation expectations remain well anchored. He also suggested that fiscal consolidation is needed to stabilize public debt and support the monetary policy stance.EU, US set up task force to resolve feud over electric vehicle batteriesThe U.S. and the European Union have set up a task force tasked with resolving a dispute over electric vehicle batteries that the EU says would discriminate against manufacturers in the 27-nation bloc and break World Trade Organization rules. Under the Inflation Reduction Act (IRA) passed by U.S. Congress in August, electric car buyers are eligible for a tax credit of up to $7,500 as long as the vehicle runs on a battery built in North America with minerals mined or recycled on the continent. The EU believes that the measure is a potential trans-Atlantic trade barrier discriminating against foreign producers. Further manufacturers in Europe and South Korea, which sell millions of vehicles in the U.S., have threatened to lodge legal complaints with the World Trade Organization. The EU announced on Wednesday that Bjoern Seibert, the head of cabinet to European Commission President Ursula von der Leyen met in Berlin with U.S. Deputy National Security Advisor Mike Pyle to launch the task force. A first meeting will take place next week.Russia holds rates at 7.5%, cautions on inflationary effects of mobilisationRussia’s central bank held its key interest rate at 7.5% on Friday, cautioning that expectations of price rises had grown and that Russia’s partial mobilisation could stoke longer term inflation due to a shrinking labour force. In the immediate aftermath of Moscow sending its armed forces into Ukraine on Feb. 24, the central bank hiked its key rate to 20% from 9.5% in order to mitigate risks to financial stability. Since then it has cut rates six times and omitted forward-looking guidance at its previous meeting in September about studying the need for future reductions. Inflation, which the central bank targets at 4%, stood at 12.9% as of Oct. 24, according to the economy ministry. The central bank tweaked its year-end inflation forecast to 12-13% from 11-13%. “According to the Bank of Russia’s forecast, given the monetary policy stance, annual inflation will drop to 5.0–7.0% in 2023 to return to 4% in 2024.” The central bank improved its GDP forecast for this year to a contraction of 3-3.5% from an expected 4-6% decline previously. In late April, it had expected GDP to shrink 8-10%. The bank forecasts a further contraction in 2023 before GDP returns to growth in 2024-25. The next rate-setting meeting is scheduled for Dec. 16.Egypt adopts flexible exchange rate as precondition to $3 billion IMF loanThe International Monetary Fund reached a preliminary agreement with the Egyptian government Thursday that paves the way for the Arab nation to access a $3 billion loan. In a statement, Egypt’s IMF mission chief Ivanna Vladkova Hollar said the 46-month Extended Fund Facility allows Egypt access to the $3 billion loan on the condition it implements a series of economic reforms. In the hours before the announcement, Egypt’s central bank announced a series of economic measures, including a hike in key interest rates by roughly 2 percentage points and a switch to a more “durably flexible exchange rate.” The bank said the exchange rate switch would now allow international markets to “determine the value of the Egyptian pound against other foreign currencies.” Following the announcement, the Egyptian pound dropped to a record low against the U.S. dollar from 19.75 to around 22.99, according to data provided by Egypt’s central bank. Before Wednesday’s flotation of the Egyptian currency, the U.S. dollar was traded at an average of 23 pounds in the black market. Since the beginning of the year, the Egyptian pound has lost around 46% of its value against the U.S. dollar. “The commitment to durable exchange rate flexibility going forward will be a cornerstone policy for rebuilding and safeguarding Egypt’s external resilience over the long term,″ said Hollar. In a statement issued Thursday morning, Egypt’s central bank said it had raised the new lending rate to 14.25% and the deposit rate to 13.25%. The discount rate was also raised to 13.75%, it said. Egypt’s monetary reforms and the IMF loan are designed to help offset rising inflation, which passed 15% in September, and lighten the financial pressure on lower- and middle-income households. Some of the agreement’s main goals are to reduce Egypt’s overall debt and bring about broad reforms to its fiscal policy, Hollar said. As part of its monetary reforms, the central bank said it would begin removing a system for importers, a red tape process introduced in February to control the demand on the currency for imports. Egyptian Prime Minister Mustafa Madbouly announced an 11.1 % increase in the minimum monthly wage, from 2,700 pounds ($137) to 3,000 pounds ($152), the fourth such increase since 2014. //////////////////////////////////////////////////////////////////////////
Bahamas: Govt revenue up 9% year over yearGovernment revenue in the Bahamas in August stood at $197.8 million, a 9% increase year-over-year, but a 24% decrease over the previous month. According to the Ministry of Finance, “during the month, revenues increased by 9.4% ($17 million) to $197.8 million compared to the prior year. The improved performance is largely attributed to an increase in revenue collection from international trade and transaction taxes ($12.4 million), other taxes on goods and services ($5.2 million), the sale of goods and services ($5.9 million), and VAT receipts ($3.9 million).” The Ministry also explained that “… month-over-month, revenues decreased by 24% ($62.6 million) largely due to seasonal trends of lower VAT receipts ($50.6 million) for August relative to July as domestic consumption eases with more summertime traveling.” “Total expenditure increased by 6.9% ($15.3 million) to $237.4 million compared to the prior year, owing to increased outlays on the use of goods and services ($10.2 million) and subsidies ($12.9 million).” the Ministry said. “Compared to the prior month, August 2022 expenditure increased by 8.4 percent ($18.4 million), mostly due to additional disbursements for the acquisition of non-financial assets ($21.3 million).” Government paid $23.1 million in public debt interest payments, $64.6 in personal emoluments, $47.9 million in subsidies, $38.4 million on the use of goods and services and $17.3 million in social assistance. In August, government’s debt increased by $8 million. (NG)Barbados to implement local number portabilityThe Barbados government says consumers will soon be able to switch telephone service providers for mobile and landline services without having to change their phone numbers. It said the local number portability or number porting will be free to consumers. The only cost persons are likely to incur is a small fee to unlock their handset for it to work on the new network. According to Industry, Innovation, Science, and Technology Minister, Davidson Ishmael, the legislation and regulations mandating the introduction and launch of the local number portability service are ingrained within the national telecommunications legislation of Barbados and the government is making it easier for new companies to join the telecommunications market. “We have put measures in place to ensure that these new firms can connect to existing networks at a fair price, so that they can offer competitive services to you, the consumer, giving you more choices and more power when it comes to the choice of your phone company,” Minister Ishmael said. (CNW)_________________________________________________________________________________
Belize records inflation of 6.2%
The year-to-date inflation rate in Belize for the first nine months of 2022 stood at 6.2% relative to the corresponding period in 2021. On a point to point basis inflation as at September 2022 increased by 7.1%. As in previous months this year, inflation was primarily driven by higher prices for motor vehicle fuels, several food items, liquefied petroleum gas (LPG), restaurant services, and household cleaning products. The ‘Transport’ category, with a year-to-date inflation rate of 19.1%, was directly responsible for more than a half of the overall increase in consumer prices for the nine-month period, as considerably higher costs were seen across all types of motor vehicle fuels, as well as new motor vehicles, and passenger transport services. The ‘Food and Non-Alcoholic Beverages’ category had a year-to-date inflation rate of 6.7%, due mostly to higher prices for cereal products, dairy products, meats, cooking oils, fresh produce, fish, and other seafood. ‘Housing, Water, Electricity, Gas and Other Fuels’ recorded a 2.8% year-to-date inflation rate, due to a 24.4% rise in LPG prices and 14.4% increase in construction materials for household use over the first nine months of the year. Higher prices for restaurant services resulted in a 5.2% year-to-date inflation rate for the category of ‘Restaurant and Accommodation Services’. Among the other categories, prices were notably higher for laundry products, soaps, detergents, and cinema entrance fees. The only category to record an overall decrease in prices for the period was ‘Information and Communication’, which declined by 0.8 percent, as a result of lower prices for internet provision services. On a point to point basis inflation as at September 2022 increased by 7.1%. (SIB)
Record U.S. Crude Exports Push Oil Prices Higher
December WTI crude oil futures closed higher for the week ending October 28. A number of factors including optimism over record U.S. crude exports, signs that recession fears are fading and of a weaker U.S. Dollar fuelled the bullish price action. Helping to put a cap on gains were worries over demand from China. Longer-term traders noted that the start of OPEC+ production cuts and the European Union’s embargo on Russian crude oil were also underpinning prices all week. U.S. crude oil stockpiles rose in the most recent week, even as the volume of exports hit an all-time record, the Energy Information Administration reported on Wednesday. Crude inventories rose by 2.6 million barrels in the week to Oct 21 to 439.9 million barrels, nearly triple analysts’ forecasts in a Reuters poll for a 1-million-barrel rise. The big surprise that drove prices higher, however, was the news that crude exports surged to a weekly record of 5.1 million barrels per day, cutting net crude imports to just over 1 million bpd, also a record. (OP)
International Oil Prices
Oil Prices at the close of business on October 28, 2022Oil Prices at the close of business on October 28, 2022
Grenada: 49.2% capital funding comes from CBI programme
An estimated 49.2% of capital expenditure in Grenada in 2022 is being funded by its Citizenship by Investment (CBI) programme. In fact, a significant amount of the revenue garnered is used to pay international creditors or debt and fund capital programmes for the Government. Since launching the CBI programme, over 6,500 people from various territories and jurisdictions such as the USA, Nigeria, India, South Africa, and Russia, have successfully paid for their Grenadian citizenship through Sections 10 and 11 of the CBI law. At the start of the Russian war on Ukraine, the Government of Grenada suspended accepting applications but resumed in April 2022. All applications from Russia must first be checked against the sanction list of the European Union, the United Kingdom, the United States of America and all countries with similar lists. (NOWG)
Regional Stock Market Report
Jamaica Stock Exchange Overall Market activity resulted from trading in 52 stocks of which 15 advanced, 26 declined and 11 traded firm. Market volume amounted to 38,324,413 units valued at over J$144,259,709.50. Wigton Windfarm Limited Ordinary Shares was volume leader with 31,654,375 units. The JSE Index declined by 1,837.93 points to close at 348,203.83. Jamaica Junior Stock Exchange Overall market activity resulted from trading in 38 stocks of which 18 advanced, 15 declined and 5 traded firm. Market volume amounted to 6,115,628 units valued at over J$18,600,896.19. Index closed at 4,150.00.      Barbados Stock Exchange One security traded firm as 4,000 shares traded on the   Regular Market, with a total value of $12,000.00. Goddard   Enterprises Limited was the sole security trading. Index closed at 2,370.39. Trinidad & Tobago Stock Exchange Overall Market activity resulted from trading in 18 securities of which 8 advanced, 3 declined and 7 traded firm. Trading activity on the First Tier Market registered a volume of 215,345 shares crossing the floor valued at TT$2,111,993.80. Massy Holdings Limited was volume   leader with 108,619 shares changing hands valued at TT$489,491.02. The All T&T Index advanced by 5.08 points to close at 1971.45 and the Composite Index advanced by 3.74 points to close at 1320.63. Guyana Stock Exchange 2 stock advanced, 2 traded firm and 1 declined as 134,057 units traded. Banks DIH (DIH) was volume leader with 90,212 shares. Index closed at 1,607.58.Eastern Caribbean Securities Exchange (ECSE) 2 stocks traded 6,869 units. St. Kitts Nevis Anguilla National Bank was volume leader with 6,819 units.  
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Did you enjoy this issue? Yes NoJoseph Cox @josephbbcoxA weekly aggregation of some of the more topical business news occuring in or likely to impact CARICOM / Caribbean 
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CARICOM Secretariat, Turkeyen, Greater Georgetown, Guyana

Guyana News Updates, October 26, 2022

American Caribbean Maritime Foundation to host gala in Florida with Guyana President Irfan Ali – November 4, 2022

Caribbean Investment Forum

November 8-11, 2022 – Trinidad

Caribbean Investment Forum launched with focus on building resilience and boosting investment in the region | Caribbean Export

City Chamber’s business development forum slated for November | OilNOW

Access to finance, opportunities in oil & non-oil sectors to be addressed at upcoming business forum

Georgetown Chamber Business Forum November 11-12, 2022

Exxon strikes oil again in Guyana with two new discoveries | Reuters

BREAKING: Exxon makes two more discoveries offshore Guyana: OilNOW

ExxonMobil today announced two discoveries at the Sailfin-1 and Yarrow-1 wells in the Stabroek block offshore Guyana, adding to its extensive portfolio of development opportunities. ExxonMobil has made more than 30 discoveries on the block since 2015, and it has ramped up offshore development and production at a pace that far exceeds the industry average. “Our unrivaled exploration success and accelerated pace of development in Guyana are a testament to our people, decades of experience, technology capabilities and steadfast focus on optimizing all aspects of operations,” said Liam Mallon, president of ExxonMobil Upstream Company.

ExxonMobil announces two more oil discoveries offshore Guyana – Demerara Waves Online News- Guyana

With new discoveries, oil production to exceed 1 million barrels per day by 2030  – News Room Guyana

Six Bourbon vessels to support Stabroek Block operations until end of decade: OilNOW

Offshore marine services company – Bourbon Guyana Inc. – currently has six vessels supporting oil and gas operations offshore in the Stabroek Block and those vessels will remain until the end of the decade. Managing Director of the Company, Edward Cooper, explained to OilNOW that Bourbon has three mooring support vessels in operation tending to the Liza Destiny and Liza Unity floating, production, storage, and offloading (FPSO) platforms.

New offloading facility, heavy haul road to be constructed for gas-to-energy project: OilNOW

A new Materials Offloading Facility (MOF) and heavy haul road are set to be built on the West Bank of Demerara to complement the construction of Guyana’s Natural Gas Liquids (NGL) Facility and Power Plant for the Gas-to-Energy project (GTE). ExxonMobil’s Project Manager for the GTE project, Friedrich Krispin, shared this during the Guyana Basins Summit 2022.

Access to finance, opportunities in oil & non-oil sectors to be addressed at upcoming business forum: Guyana Times  

…to feature 500 delegates

The Business Development Forum will be making its return next month, with the two-day event organised by the Georgetown Chamber of Commerce and Industry (GCCI) scheduled to be held from November 11 to 12 at the Pegasus Corporate Centre. This was explained at a press conference hosted by GCCI President Timothy Tucker on Tuesday. The forum, first held in 2018, was halted in 2020 due to the COVID-19 pandemic. This will therefore be the first time it is being held in two years.

Ramps is colliding with the interests of powerful locals: Stabroek News (Letter to the Editor) GHK Lall

There is so much more below the surface in the swirl of media items on Ramps Logistics, the Trinidadian-originated entity that is running into heavy weather with not one, but two State agencies in Guyana.  On the one hand, I observe the Government of Guyana being adamant that this is how this Local Content business should work, this is where matters have run aground, and because of what and how differences unfolded, there is a problem.  More than one, in fact.

Traditional ways of doing business have to change – GCCI President – News Room Guyana

LGE 2023 could change the political landscape of Guyana forever – Guyana Times

Guyana records significant progress in reducing gender gap in politics, education, health, economics – report – News Room Guyana

U.S, Guyana collaborate on national disaster preparedness – News Room Guyana

Guyana-Venezuela Waiting Game

Guyana News Updated, October 21-23, 2022



Latin America and the Caribbean: What Agenda and Role for the Inter-American Development Bank?

Monday, October 24, 2022



US Department of Commerce Caribbean Trade Mission & Conference

October 23-28, 2022

Miami and various Caribbean markets



Caribbean Investment Forum

November 8-11, 2022 – Trinidad


Caribbean Investment Forum launched with focus on building resilience and boosting investment in the region | Caribbean Export





Trade Americas Mission could burnish Guyana’s image as region’s best investment bet – Stabroek News


Western Logistics to hire 1000 Guyanese as part of new approved five-year Master Plan: OilNOW

With its five-year Local Content Master Plan approved by the Ministry of Natural Resources, Western Logistics Guyana aims to expand its human resource capacity by some 1,000 Guyanese. According to its Operations Director, Pradeep Ramoutar, the locally owned and operated logistics firm is looking to hire at least 200 Guyanese to work offshore every year, for five years. Western was the first logistics company to receive its approval.


Exxon sent out 35 letters seeking new partners after Shell walked away from Stabroek Block: OilNOW

Before China National Offshore Oil Corporation (CNOOC) and Hess Corp. partnered with ExxonMobil to become the Stabroek Block co-venturers we know today, there was Shell. The British multinational held a 50% stake with Exxon, but the company opted to leave a mere year before the world class Liza discovery, the very first commercial reservoir to be found offshore the South American country. Shell had believed that the chances of success in the Stabroek Block were essentially slim to none.


ExxonMobil books DOF Subsea vessels offshore Guyana – Offshore Energy


ExxonMobil Awards DOF Subsea a $253,4M Deal for Offshore Vessel Duo in Guyana


Guyana’s largest shore base, sister company receive approval for Local Content Master Plans: OilNOW

The largest shore base in South America’s newest oil and gas hotspot, Guyana Shore Base Inc. (GYSBI), and its sister company, Sustainable Environmental Solutions (SES), on October 19 had their Local Content Master Plans approved by the Ministry of Natural Resources. A Local Content Master Plan is a ‘development blueprint’ that is enforceable by law. It outlines a company’s procurement, employment, and capacity development plans over a five-year period.


GYSBI, SES receive approval for Local Content Master Plans: Guyana Times

Guyana Shore Base Inc (GYSBI) and its sister company, Sustainable Environmental Solutions (SES) on Wednesday received approval for their Local Content Master Plans from the Local Content Secretariat of the Natural Resources Ministry. The Master Plans are a requirement of the Local Content Policy, which was passed in Parliament in December 2021 by the Government.


US$493M payout from Guyana’s third quarter oil sales, royalties gazetted | OilNOW


Noble Discoverer set to arrive in Guyana this weekend to drill CGX’s Wei-1 well |OilNOW


TechnipFMC, Stena Drilling among 11 more companies to have local content master plans approved | OilNOW


Gov’t to identify legal, financial team to support catering consortium for oil sector market | OilNOW


Evening News: Jarryl Bryan joins us now to report that work is ongoing on a National Gas Strategy that, according to President Dr Irfaan Ali, will open up new opportunities for trade and energy security between Guyana and its bilateral partners.


Ramps Logistics CEO on $500,000 bail for false declarations to GRA charges – Guyana Times


Ramps CEO enters not guilty plea to company’s false declarations charges, out on GY$500,000 bail | OilNOW


Ramps at risk of losing US$25 million Exxon contract, firing 100 workers without Local Content Certificate – court documents: OilNOW

If Ramps Logistics Guyana Inc. is not granted a Local Content Certificate of Registration, it will likely lose significant contracts with major industry players like ExxonMobil affiliate, Esso Exploration and Production Guyana Limited (EEPGL). According to court filings which form part of a judicial hearing over the State’s refusal to award the certificate, Ramps explained that it is facing financial ruin as it could lose a US$25 million contract with EEPGL.


Denial of Local Content certification: Arguments in Ramps Logistics’ judicial review case against Govt set for Nov 11: Guyana Times  

An application filed in the Demerara High Court by Ramps Logistics (Guyana), seeking judicial review of the Government’s decision to deny the company Local Content certification, will be heard on November 11by acting Chief Justice Roxane George, SC. A case management conference (CMC) for the application, which was filed late last month, was held on Thursday, during which Justice George fixed strict timelines by which the parties must file certain legal documents ahead of next month’s hearing.


Government halts Ramps’ local content application pending outcome of criminal charges | OilNOW


Ramps chairman: dark forces in Guyana’s private sector want me out – Trinidad Guardian


Govt. must look out for anti-competitive practices, abuse of legal loopholes by oil companies: Kaieteur News

– New York based lawyer warns

While Guyana’s Local Content Legislation must be commended for its pursuit to increase the involvement of Guyanese in the oil sector, New York-based Attorney-at-Law, Dr. Vivian Williams is urging regulators to be wary of companies that would engage in various forms of anti-competitive behaviourand creative compliance with the law. The lawyer said such practices that may seek to exploit legal loopholes, undermine the spirit and intent of the legislation which seeks to maximize the use of local goods and services in the oil sector.


Govt working to have more flights, cargo into Guyana in near future – Edghill – Guyana Times


Govt working to enhance image on US travel advisories – Guyana Times


‘No underhand way’ to acquire a Guyanese passport – Home Affairs Minister assures – News Room Guyana


The second British Invasion, this time with oil blocks in mind: Stabroek News (Letter to the Editor) by GHK Lall

Guyanese drove themselves to rapturous heights over the ordinary metamorphosed into the extraordinary, the grandeur, of visa-free travel to the land of their former colonizers and imperial masters.  How quickly we forget!  How self-enslaving we can be! We have more oil per breathing body than any place on earth, and we are drooling over a visa-free travel announcement?  Is this what the fruits of free and fair elections have come to mean?  That we run to anywhere?  Surely, we have lost whatever marbles we had left, that is, if we ever had any to begin with, given how people have reacted, how things shaped up since that announcement.


No exclusive housing development for foreigners – Pres. Ali warns: News Room

President Irfaan Ali has warned against private developers using lands, particularly those acquired from the state, to build exclusive housing schemes or for the development of gated communities for foreigners. In the clearest possible terms, the President has said that no development on such lands must be exclusively for foreigners. Dr. Ali said he has given clear instructions that these lands, although being privately developed, should be made available to all Guyanese. The President’s statements come days after Dutch shipbuilder – SBM Offshore – made a public request to lease a gated community and recreational facility for its employees.


Omai doubles gold mineral resource estimates in Guyana – Guyana Times


Guyana writes to Facebook, Twitter over Venezuela map | Miami Herald


Guyana, Grenada talk enhanced partnership but Guyanese urged to return home – News Room Guyana


Energyear Caribe 2022: SungrowPresents Latest Innovations for the Caribbean Decarbonization – PR Newswire APAC


Can Suriname replicate Guyana’s oil boom?: Stabroek News  

The Guyana-Suriname Basin is quickly emerging as one of the most prolific offshore oil regions in the world. Guyana has had tremendous success in its ventures with Big Oil in the region. Suriname is looking to follow in Guyana’s footsteps though it has suffered a few setbacks along the way. The offshore Guyana-Suriname Basin emerged in 2019 as one of the world’s most exciting drilling frontiers. While the U.S. Geological Survey estimated that the basin contained mean undiscovered oil resources of 15 billion barrels, disappointing exploration results saw international energy companies shun the geological formation.


The paradox of Suriname and Guyana, oileldorados with neutral or negative carbon balances – California18


Suriname’s Frustrated Path to Better Governance by Scott B. MacDonald


SVG Gov’t seeking to acquire prefab greenheart houses from Guyana

CARICOM BUSINESS, October 23, 2022

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CARICOM Business

A weekly aggregation of some of the more topical business news occcuring in or likely to impact CARICOM / Caribbean

Fitch: Fitch: Barbados assigned B rating with stable outlook

Fitch ratings has assigned a long-term foreign currency issuer default rating (IDR) of ‘B’ with a stable outlook to Barbados. It also assigned a short-term IDR of ‘B’, a country ceiling of ‘B’ and senior unsecured debt level of ‘B’. In its rationale, Fitch Ratings said the country’s latest ratings “balance high GDP per capita and governance scores, a strengthened external liquidity position, and a more favourable debt repayment profile following a comprehensive 2018-2019 restructuring, against its vulnerability to external shocks due to its heavy reliance on tourism, high public debt levels and limited appetite for domestic debt from local commercial banks.” “The rating is supported by the recent International Monetary Fund (IMF) staff-level agreement to access the Resilience and Sustainability Trust (RST) with an accompanying Extended Fund Facility (EFF) programme which would underpin reform momentum and alleviate financing constraints, as well as Fitch’s expectation of a relatively quick reduction in the debt burden from high levels in the forecast period,” it explained. Pointing to the 10.5% economic growth during the first half of this year, the report noted that economic recovery has begun. Fitch said it was forecasting real GDP growth of 9% this year and 3% in 2023, although recessions in key source markets such as the United States and the United Kingdom pose downside risks. Fitch said there were a number of factors that could individually or collectively lead to a negative rating action in the future, including the emergence of financial constraints such as a breakdown in relations with international financial institutions or failure to consolidate fiscal accounts, as well as a sharp reduction in external liquidity such as a deterioration in the current account deficit stemming from an external shock. (BT)

Guyana earns US$493m in oil profits & royalties in 3rd qtr

Guyana earned US$493.1 million which included profit oil of US$442.1 million and royalties amounting to US$51 million from the oil and gas industry July to September, according to the Bank of Guyana (BoG) in its third-quarter report for 2022. The BoG said the increase in revenue was attributed to the additional Floating Production and Storage Offloading (FPSO) vessel, the Liza Unity, being in operation in the Liza Phase Two of the Stabroek Block. Since oil production began in 2019, Guyana has recorded six lifts of profit oil, which have brought in US$1.2 billion in profit oil revenue and US$153.1 million in royalty payments. (CNW)

Foreign Exchange Summary

Applicable rates as at October 21, 2022

Applicable rates as at October 21, 2022

SVG records fiscal deficit of EC$90.7m as at September 2022

Government finances in St. Vincent and the Grenadines registered a deficit of EC$90.7 million as of September this year, compared to EC$81.8 million in 2021, despite higher revenue in 2022. According to Minister of Finance Camillo Gonsalves total revenue and grants for the first three quarters of the year stood at EC$516.9 million, compared to EC$522.6 million, year-on-year. He said current revenue for 2022 was EC$486.5 million as opposed to EC$473 million last year. Current revenue is up 2.9% while total revenue and grants is down 1.1%. Current expenditure increased by 1.7% to EC$496.7 million relative to the corresponding period last year. Gonsalves said that capital expenditure was EC$121.5 million, compared to EC$122.8 million in 2021, for a current balance deficit of EC$10.1 million as opposed to an EC$15.6 million deficit last year. Capital expenditure jumped to EC$191 million up from EC$122 million in 2021. (IWNSVG)

Corporate Movements

  • Dolla Financial Services Limited has appointed David Henriques as Chief Executive Officer, Ultra Financier Limited;
  • Access Financial Services has advised of the resignation of Frederick Williams, Chief Executive Officer, effective December 9, 2022;
  • The Scotia Group Jamaica has announced the appointment of Gabrielle O’Connor as VP, Finance and Chief Financial Officer effective October 10 and Maia Wilson as VP, Senior Legal Counsel & Company Secretary effective October 1;
  • Berger Paints Limited has advised of the resignation of Carlinton Montgomery, Chief Financial Officer and Company Secretary, effective September 30, 2022;
  • EduFocal Limited has advised of the resignation of Chelsea Taylor as Operations Director effective October 5 and the appointment of Tianka Scott-Morrison as Education Director effective October 3.

Supplementary Unemployment Benefit extended 

The Supplementary Unemployment Benefit [SUB] has been extended to November 30th, the Government of Bermuda has confirmed. According to the Minister of Economy and Labour (MEL) , Jason Hayward, since its inception in September 2020 to 31 August 2022, payments totalling $2,818,751 have been made to individuals. Furthermore, the total    benefit and health insurance payments, coupled with the administrative cost for the SUB, amount to $3,006,899.  Minister Hayward said, “As we move beyond the pandemic toward greater economic stability the MEL will continue leveraging policies within its remit that support the reintegration of all Bermudians into the local economy.” (BER)


Caribbean might not be ready for electric vehicles as US market poised to grow by 386%

There are mounting concerns that some Caribbean countries may not be ready to transition to electric vehicles (EVs). According to Valentine Fagan, Chairman of the Office of Utilities Regulation’s Electric Vehicle Working Group in Jamaica, says a full implementation of EVs without proper planning can pose problems for electricity distribution. He said data from Tax Administration of Jamaica show there are more than 500,000 vehicles in the country, but if just one per cent of those vehicles are EV, this would “bring a significant strain on the electricity grid”. However, he said the issue can be resolved with proper management and the implementation of additional infrastructure. In the meantime, the electric vehicle market in the United States is on track to grow from $28.24 billion in 2021 to $137.43 billion in 2028 or 386.6% by 2028 at a Compound Annual Growth Rate (CAGR) of 25.4%. Major automakers from Ford to GM have launched EV ranges. The U.S. crossed the tipping point for EV mass adoption earlier this year when 5% of all new car sales were fully electric. At the beginning of 2022, the U.S. became the third biggest EV market after Europe and China. Based on this achievement, a quarter of U.S. car sales could be all-electric by as soon as 2025, a year earlier than originally predicted. (RJR) (OP)

Hurricane Ian could dampen investor appetite for cat bonds

Capital unable to get significant returns from insurance-linked securities (ILS) investment could bolt for greener pastures, a Fitch Ratings assessment has determined. The report says the fallout from Hurricane Ian could test the investor appetite for bonds. Reinsurers have used the insurance-linked securities market to manage risks and to pay insured losses, amid rising rates and increasingly volatile catastrophic losses. Of its latest report, Fitch says: “ILS investors not properly compensated for risk or facing elevated losses amid fallout from Hurricane Ian may choose to reinvest capital elsewhere, which would exacerbate the demand/supply imbalance of the reinsurance sector, which is especially acute in the Florida property market.” Fitch says: “ILS include catastrophe bonds, collateral reinsurance, sidecars and industry loss warranties, representing around 20%, or $100 billion, of global reinsurance capacity.“ Cat bonds are approximately 30% of the ILS market. Commentary from the Monte Carlo Rendezvous 2022 indicated a pipeline of ILS deals of $5 billion of additional reinsurance capacity, which would benefit insurers facing a hardening market. “However, the ILS market will assume a fair share of losses from Ian, with Fitch estimating total insured losses of $35 billion to $55 billion, second only to Hurricane Katrina at $65 billion ($90 billion in 2021 dollars). (RG)

Jamaica inches closer to full employment

As Jamaica inches closer to full employment, the unemployment rate as at July 2022 stands at 6.6%, 1.9 percentage points lower than the 8.5% recorded in July 2021. The male unemployment rate decreased by 1.1 percentage points from 6.3% to 5.2%, while the female unemployment rate declined by 2.8 percentage points from 11.1% to 8.2%. The youth unemployment rate (persons aged 14-24 years) was 16.7% in July 2022, 7.2 percentage points lower than in July 2021. In July 2022, there were 1,268,000 employed persons, an increase of 53,000 compared to the similar quarter of 2021. There were 42,000 more employed females, representing 79.2% of the total increase in employment. The occupation groups ‘Clerks’ and ‘Service Workers and Shop and Market Sales Workers’ combined accounted for the majority of the increase in the employed labour force. There were 132,200 persons employed in the occupation group ‘Clerks’ in July 2022, an increase of 25,400 or 23.8 per cent compared to July 2021. In July 2022, there were 739,600 persons classified as Outside the Labour Force, a decrease of 27,900 (3.6%) compared to 767,500 in July 2021. There was a decrease of 1,700 males and 26,200 females. (STATIN)

As food security crisis deepens, 26 countries impose food export bans

Data for May to September 2022 shows high inflation in almost all low-income and middle-income countries; 88.9% of low-income countries, 91.1% of lower-middle-income countries, and 96% of upper-middle-income countries have seen inflation levels above 5%, with many experiencing double-digit inflation. The share of high-income countries with high food price inflation has risen to 85.7%. Compared to two weeks ago, the agricultural price index is 1 percentage point higher. Average wheat, maize, and rice prices in October 2022 are 18%, 27%, and 10% higher, respectively, than in October 2021. Meanwhile, wheat and maize prices are 38% and 4% higher, respectively, and rice prices are  21% lower than in January 2021. According to the World Bank, the war in Ukraine has altered global patterns of trade, production, and consumption of commodities in ways that will keep prices at high levels through the end of 2024 exacerbating food insecurity and inflation. According to an IMF paper, $5 billion to $7 billion in further spending is needed to assist vulnerable households in 48 countries most affected by the higher food and fertilizer import prices. An additional $50 billion is required to end acute food insecurity over the next 12 months. The global food crisis has been partially made worse by the growing number of food trade restrictions put in place by countries with a goal of increasing domestic supply and reducing prices. As of October 10, 2022, 21 countries have implemented 26 food export bans, and eight have implemented 12 export-limiting measures. (WB)

Food Security Update 

High energy and fertilizer costs, poor weather in key producing countries, and the Ukraine-Russia war risks have led to high domestic food price inflation. Geopolitical risk highlighted as a major driver of price volatility (Update as at October 13, 2022

Credit card use up 57 percent during pandemic

Credit card payment use in The Bahamas shot up 57% during the height of the COVID-19 pandemic and the dollar figure of these kinds of transactions has, over a period of ten years, increased from $400 million to more than $1 billion, according to a report titled “Cash Transformation in the Bahamas”. The report, which was developed in partnership between RBC Royal Bank Bahamas and Oxford Business Group, explains that in 2020 The Bahamas had its highest increase in real-time gross settlement (RTGS) transactions. The report also explains that cheque use had already been on the decline before The Central Bank of The Bahamas announced that they would be phased out. “Although check elimination is set to take place by the end of 2024, in 2019-2020 there was a 40% reduction in the number of cleared checks,” the report said. “This reduction has been more than offset by processing digital payments through the RTGS. Cooperation between commercial banks, financial institutions and the government has been the cornerstone of this progress.” The report gives kudos to the development of central bank digital currency (CBDC) the Sand Dollar, and explains that the total amount in circulation at this time amounts to about one percent of total money in circulation. The report added that only about seven percent of the population utilizes e-wallets, which are used to hold the CBDC. (NG)

Report: How has public-private collaboration boosted digital and cash transformation in the Bahamas? | [term:name] 2022 | Oxford Business Group

Report: How has public-private collaboration boosted digital and cash transformation in the Bahamas? | [term:name] 2022 | Oxford Business Group

Public-private collaboration aimed at boosting digital payments and reducing cash usage in the Bahamas has made gains in a relatively short timeframe.

BMA seeks comment on proposed new digital asset business code

The Bermuda Monetary Authority is seeking feedback from stakeholders on the proposed amendments to the Digital Asset Business Act 2018: Code of Practice and Digital Asset Business (Client Disclosure) Amendment Rules 2022. It is in relation to an initiative establishing a conduct of business regulatory framework, which ensures protection for customers using the services of regulated financial institutions. The BMA said: “The code of practice and client disclosure rules amendments seek to ensure that, among other things, a digital-asset business shall: have an obligation to treat clients fairly and equitably; have continuing regard for clients’ interests in the conduct of their business; ensure that communications with clients are fair, clear and not misleading; provide the necessary protection against the loss of clients’ assets due to internal fraud or misuse; handle complaints and errors in a manner that is fair and expedient; and ensure that clients, especially retail clients, are aware of their responsibilities within the business relationship and facilitate access to appropriate resources to help them understand their responsibilities within the business relationship.” (RG)

Trinidad ready to boost LNG, ammonia exports once more gas is online

Trinidad and Tobago, Latin America’s largest producer of liquefied natural gas and among the world’s three top exporters of ammonia, is exploring ways to boost shipments of gas and petrochemical products to help ease global shortages, Energy Minister Stuart Young said on Wednesday. Trinidad has three liquefaction trains in service and 11 ammonia plants with a total production capacity of 5.2 million metric tonnes per year. “Right now, we have a significant capacity in our plants – LNG, methanol, urea and ammonia – all of them can produce more than we need, once we have access to natural gas,” he said. Trinidad relies on costly offshore production to supply gas to its LNG and petrochemical complexes. Private producers are rushing projects to bring new production online in the coming years while the government is in talks with oil and gas producer Venezuela. Young said he is discussing with producers in Trinidad green ammonia projects, a form of ammonia produced from air and water using renewable power, considered more environmentally friendly. The final product can serve as a fertilizer or an energy-dense fuel. (Reuters)


Turkey slashes interest rates by 150 basis points despite inflation at 83%

Turkey’s central bank on Thursday slashed its key interest rate by 150 basis points for the third consecutive month of cuts, from 12% to 10.5% — despite Turkish inflation at more than 83%. Consumer prices for the country of 84 million people climbed to a new 24-year high of 83.45% in September, though many people living in Turkey say prices for basic goods have in some cases more than tripled in the past year. The country’s monetary policy, directed by Turkish President Recep Tayyip Erdogan, is based on a pursuit of growth and export competition rather than calming inflation. Erdogan vocally espouses the unorthodox belief that raising interest rates increases inflation, rather than the other way around, and has called hiking rates “the mother of all evil.” The policy consistently provokes criticism and bafflement from economists, and plays a major role in the dramatic weakening of Turkey’s currency, the lira, which has lost roughly 28% of its value against the dollar this year.

Malaysia’s trade turnover posts double-digit growth for 20 consecutive months

Malaysia’s Ministry of International Trade and Industry (MITI) said the nation’s trade continued its upward trajectory in September 2022, up by 31.4% year on year to 256.91 billion RM (54.43 billion USD), marking the 20th consecutive month of double-digit growth. As reported by the country’s news agency Bernama, the ministry said exports increased by 30.1% to 144.31 billion RM, marking the 14th successive month of double-digit growth, while imports expanded by 33% to 112.60 billion RM. As a result, Malaysia’s trade surplus achieved a new record high of 31.71 billion RM. MITI largely attributed the export growth to robust external demand for electrical and electronic (E&E) products, petroleum products, liquefied natural gas (LNG), crude petroleum, optical and scientific equipment as well as machinery, equipment and parts. Malaysia’s exports to major trading partners, notably ASEAN, the US, the EU, and Japan, recorded double-digit growth, with the figure for Japan registered the highest monthly value ever. 

UK inflation back at 10.1%

The consumer price index for the United Kingdom rose 10.1% in September, according to estimates published Wednesday by the Office for National Statistics. The CPI monthly rate was 0.5% in September 2022, compared with 0.3% in September 2021. In September 2022, the CPI annual inflation rate returned to the July level, which was the highest annual CPI inflation rate in the National Statistic series, which began in January 1997. Inflation unexpectedly dipped to 9.9% in August, down from 10.1% in July, on the back of a fuel price decline. Increasing food, transport and energy prices were the biggest contributing factors to inflation, the ONS said. Food was up 14.6% year-on-year, transport was up 10.9% compared to last year, while the price of furniture and household goods rose 10.8%. The Consumer Prices Index including owner occupiers’ housing costs (CPIH) rose by 8.8% in the 12 months to September 2022, up from 8.6% in August. The inflation data comes just as the Bank of England plans to sell off some of its government bonds, known as gilts, from November 1.

UK financial outlook downgraded to negative by rating agency Moody’s

Moody’s rating agency has cut its UK’s financial outlook to negative but maintained its sovereign rating at Aa3. On Friday, the agency lowered the UK’s outlook to negative from stable, citing policy uncertainty amid high inflation and weaker growth prospects. Moody’s said the government’s “ability to engender confidence in its commitment to fiscal prudence” will be a consideration for Moody’s in “resolving the negative outlook”. It added that the unchanged Aa3 rating “reflects the UK’s economic resilience supported by its wealthy, competitive and diversified economy”. The report said there was also “risks to the UK’s debt affordability from likely higher borrowing and risk of a sustained weakening in policy credibility”. On 23 September, former chancellor Kwasi Kwarteng announced around £45bn pounds of permanent, unfunded tax cuts alongside an expensive plan to cap energy tariffs for household and businesses. The move sent sterling and bond markets into a tailspin and triggered a political crisis that led to Liz Truss firing Mr Kwarteng and then reversing almost all the planned tax cuts before then announcing her own resignation. New Chancellor Jeremy Hunt has said he will do “whatever it takes” to restore confidence in Britain’s public finances. He is due to announce a plan on 31 October aimed at bringing down public debt as a share of economic output in the medium term.

Eurozone inflation inches towards double digits

The euro area annual inflation rate was 9.9% in September 2022, up from 9.1% in August. A year earlier, the rate was 3.4%. European Union annual inflation was 10.9% in September 2022, up from 10.1% in August. A year earlier, the rate was 3.6%. Eurostat, the statistical office of the European Union, publishes these figures. The lowest annual rates were registered in France (6.2%), Malta (7.4%) and Finland (8.4%). The highest annual rates were recorded in Estonia (24.1%), Lithuania (22.5%) and Latvia (22.0%). Compared with August, annual inflation fell in six Member States, remained stable in one and rose in twenty. In September, the highest contribution to the annual euro area inflation rate came from energy (+4.19 percentage points, pp), followed by food, alcohol & tobacco (+2.47 pp), services (+1.80 pp) and non-energy industrial goods (+1.47 pp). 

Japan’s trade deficit balloons for 14th month on energy costs, cheap yen

Japan marked a trade deficit for the 14th month in a row, government data showed on Thursday, with exports and imports ballooning to record highs, as the declining value of the yen added to the soaring costs of imported energy, food and other goods. Imports totalled 10.9 trillion yen (USD 72.7 billion) in September, according to the Finance Ministry, up nearly 46 per cent from the same month a year ago on the back of rising oil and gas costs. Imports have grown for 20 months straight on-year. But import costs were lower than the previous month’s, indicating some commodity prices have begun to stabilise. Exports totalled 8.8 trillion yen (USD 58.7 billion), with the strongest growth in autos and steel. It was the 20th straight month of year on year monthly gains. The Japanese yen has weakened drastically as the Bank of Japan maintains its negative interest rate policy, to keep economic activity going, while the US Federal Reserve tightens monetary policy to combat growing inflation pressures. Experts say that rate difference leads to a weaker yen. But the Bank of Japan has said Japan’s inflation is not as serious as the problem in the US and some other nations. Until recently, Japan has instead been striving to keep deflation, or falling prices, at bay.

U.S. budget deficit cut in half for biggest decrease ever

The U.S. budget deficit was sliced in half for fiscal 2022, the biggest drop in history following two years of huge COVID-related spending. Though still large in historical terms, the budget shortfall declined to $1.375 trillion, compared to the 2021 deficit of $2.776 trillion. The decline would have been steeper had it not been for the Biden administration’s student loan forgiveness program. Education spending totalled $639.4 billion for the fiscal year, $408 billion higher than estimated. The 2022 fiscal year saw $4.896 trillion in revenue against $6.272 trillion in outlays. The outlays number represented about a $550 billion decline in spending but an $850 billion increase in revenue. The revenue total is by far the highest ever for the U.S. government. Deficits in the previous two years soared as Congress shelled out massive sums to combat the pandemic. The shortfall hit a record $3.13 trillion in 2020 due to more than $5 trillion in CARES Act spending and other outlays. In 2019, the deficit was $983.6 billion. Prior to 2020, the highest deficit ever was $1.41 trillion in 2009 as the financial crisis came to a close. The U.S. briefly ran a surplus from 1998 to 2001.

Refrain from measures that erode tax revenues, IMF tells Ukraine

The IMF has “encouraged” the Ukrainian authorities “to refrain from measures that erode tax revenues, as they strive to align expenditure with available financing.” This was the guidance provided by an IMF staff team, which met with the Ukrainian authorities in Vienna, Austria from October 17–20. According to the IMF, the discussions focused on recent macro-financial developments and outlook, the budget for 2023 and associated external financing needs, financial sector issues and the mix of policies to support macroeconomic stability. However, the Fund acknowledges that, “The Russian invasion of Ukraine that started over seven months ago has caused tremendous human suffering and had a severe economic impact. Real gross domestic product (GDP) has contracted significantly, inflation has risen sharply, trade has been substantially disrupted, and the fiscal deficit has risen to unprecedented levels.” /////////////////////////////////////////////////////////

Value of imports up 20 percent in Q1 in the Bahamas 

The trade deficit in the Bahamas has widened during the first quarter by $751 million, although exports increased 25% and imports jumped by 20% relative to the corresponding period of 2021. According to the Bahamas National Statistical Institute merchandise imports increased to $839 million, up from the $699.4 million during the first quarter of 2021. “The major groups of merchandise, were ‘food and live animals’ which totalled $157 million, ‘machinery and transport equipment’ at $149 million and ‘mineral fuels lubricants and related materials’ which totaled $137 million. The combined value of these categories represented 53% of total imports,” the BNSI said. “Other categories that contributed to total imports were ‘manufactured goods classified chiefly by materials’ which accounted for $117 million, ‘miscellaneous manufactured articles’, valued at $107 million and ‘chemicals’, at $88 million. These groups together represented 37% of total imports.” On the other hand, the value of merchandise exports during the first quarter was $124 million, compared to $80.9 million in the first quarter of 2021. “The categories that contributed the largest proportion to the exports were ‘mineral fuels, lubricants and related materials’, which totalled $43 million, ‘food and live animals’ at $30 million and ‘manufactured goods classified chiefly by materials’ at $24 million, representing 79 percent of total exports,” the BNSI said. “Commodities that showed significant increases were ‘miscellaneous manufactured articles’, and ‘crude minerals, inedible except fuels’ which increased by 1,249%, and 193% respectively when compared to the same quarter last year. The United States remained the largest trade partner, accounting for $676 million worth of commodities, followed by the Organization of the Petroleum Exporting Countries (OPEC) at $6.9 million, Canada at $6 million, the United Kingdom at $5.78 million and Caribbean nations at $3.9 million. (NG)

Inflation of 9.3% for Jamaica

Jamaica has recorded point-to-point inflation (September 2021 – September 2022) of 9.3% down from 10.2% recorded in August. This is attributable mainly to the point-to-point inflation rate for the divisions: ‘Food and Non-Alcoholic Beverages’ (10.5%), ‘Housing, Water, Electricity, Gas and Other Fuels’ (8.5%) and ‘Restaurants and Accommodations Services’ (19.4%). For the fiscal year- to-date, the inflation rate stands at 4.2%. In the meantime, for the month of September 2022, the All-Jamaica Consumer Price Index (CPI) increased by 1.4 per cent. This upward movement was largely the result of a 4.1 per cent increase in the index for the division ‘Housing, Water, Electricity, Gas and Other Fuels’. The rise in this division’s index was due mainly to a 9.2 per cent increase in the group ‘Electricity, Gas and Other Fuels’. This resulted from the cessation of the Government of Jamaica’s 20.0% subsidy on electricity bills for customers who use 200 kilowatts per hour or less. Meanwhile, the Food and Non-Alcoholic Beverages’ division increased by 1.1%, Education increased by 5.3%. However, the inflation impulses abated somewhat by a reduction in the Transport division which declined by 0.3% due to a decrease in petrol prices for the period. (STATIN)

TCI increases projected expenditure by 4.5% for FY22/23

The TCI government has increased its projected expenditure for the 2022-2023 financial year by an additional $18.4m (4.5%), bringing it to a historic $420.3m. According to Minister of Finance, Investment & Trade Hon Erwin. Jay Saunders, the additional funds will be utilised to address the inflationary and cost of living pressures, aggressively respond to the surge in crime and to make provisions for disaster recovery following Hurricane Fiona. Saunders explained that government revenues have ticked upwards, and it is forecast to come in at $404.2m (including a Caribbean Catastrophe Risk Insurance Facility payout of $670k and grants and contributions of over $790k). The Finance Minister said to fund the additional spending, the government will draw down $16.0m from its cash reserves, which now stand at $240m, up from $189m at the start of the Financial Year (i.e. 1st April 2022). (TCW)


Guyana to digitize development approvals process

Guyana is seeking to transition to a single-window planning permit system and in this regard will be seeking to enact legislation by year-end to facilitate this process. According to Minister within the Ministry of Housing and Water, Susan Rodrigues “the government has recognised the need to introduce a far more automated process that streamlines workflow both within the CHPA (Central Housing and Planning Authority) and with stakeholder agencies that are part of the overall approval process.” The Minister added that “the goal is to have an integrated electronic permitting system where the agencies will no longer operate as silos but rather within an integrated mix of processes that take place concurrently.” “This is an initiative to bring certainty and predictability to the approval process by clearly identifying the requirements for various types of development, reducing unnecessary steps in the process or redundancy in the process,” the Minister said. Already within the Region, some countries are already incorporating electronic development approvals systems in their planning processes with the application management and data automation (AMANDA) software being an early front-runner. (NG) (CB)

China Plans Mammoth Offshore Windfarm

The Chinese city of Chaozhou in Guangdong has plans to begin construction on its massive 43.3 GW offshore wind farm within the space of a few years, according to the city’s most recent five-year plan. The location of the wind farm is ideal, with winds strong enough to run the turbines between 43% and 49% of the time—a figure that is high for the industry. At 43.3 GW of power generating capacity, the offshore wind farm will be capable of churning out as much power as the entirety of Poland or Argentina. For comparison, China added 16.9 GW of offshore wind capacity in 2021. This one plant, set to be complete in just three years, would dwarf that by a factor of 2.5. China has the largest fleet of offshore wind turbines in the world, according to Bloomberg. (OP)

International Oil Prices

Oil Prices at the close of business on October 21, 2022

Oil Prices at the close of business on October 21, 2022

Scotiabank introduces new digital payment solution for businesses

With Scotia eCom+™, the latest digital payment solution from Scotiabank, businesses can now accept online payments from their customers within 24 hours. Cristina Abreu – Director, Global Transaction Banking, Caribbean South and East at Scotiabank said the new system enables clients to start accepting credit and debit card online payments from anywhere in the world. “We continue to invest in solutions that drive business value for our clients and support their transition to more secure and convenient digital options,” she said. Scotia eCom+ allows clients to accept customer payments using Scotiabank’s secure payment page. (LOOP)

Regional Stock Market Report

Jamaica Stock Exchange 

Overall Market activity resulted from trading in 58 stocks of which 22 advanced, 28 declined and 8 traded firm. Market volume amounted to 6,909,965 units valued at over J$29,190,379.41. Wigton Windfarm Limited Ordinary Shares was volume leader with 1,760,085 units. The JSE Index   declined by 669.30 points to close at 353,428.65.    

Jamaica Junior Stock Exchange 

Overall market activity resulted from trading in 41 stocks of which 17 advanced, 14 declined and 10 traded firm. Market volume amounted to 3,421,711 units valued at over J$9,593,021.99. Index closed at 4,133.53.      

Barbados Stock Exchange 

One security traded firm as 4,000 shares traded on the   Regular Market, with a total value of $12,000.00. Goddard   Enterprises Limited was the sole security trading. Index closed at 2,370.39. 

Trinidad & Tobago Stock Exchange 

Overall Market activity resulted from trading in 19 securities of which 6 advanced, 6 declined and 7 traded firm. Trading activity on the First Tier Market registered a volume of 419,313 shares crossing the floor valued at TT$12,908,382.59. GraceKennedy Limited was volume   leader with 190,783 shares changing hands valued at TT$992,094.00. The All T&T Index advanced by 2.91 points to close at 2000.98 and the Composite Index advanced by 0.68 points to close at 1335.79. 

Guyana Stock Exchange 

1 stock advanced, 3 traded firm and 2 declined as 10,892 units traded. Guyana Bank for Trade and Industry (BTI) was volume leader with 4,000 shares. Index closed at 1,547.70 

Eastern Caribbean Securities Exchange (ECSE) 

5 stock traded 2,975 units. S. L. Horsford & Company Ltd was volume leader with 1,250 units. 

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