Dec 16-30, 2016 the Editorially Independent Publication of the Caribbean Council

VOL 39 • ISSUE 34 CARIBBEAN INSIGHT DEC 16-30, 2016 THE EDITORIALLY INDEPENDENT PUBLICATION OF THE CARIBBEAN COUNCIL

Guyana begins to ready Highlights this issue... country for oil bonanza

Click and explore: As rumours swirl in Guyana of another large offshore oil find, the country has begun to put in place the legislation necessary to regulate the vast income that the industry is expected Key Trump team members know the region to generate for the country.

Speaking on December 1 at the Annual Awards ceremony of the Georgetown Chamber of Commerce and Industry, the Minister End in sight for the opening of Baha Mar? of Natural Resources, Raphael Trotman, said that Guyana was “on the verge of acquiring fortunes that some had only fleetin- gly thought possible, with the discovery of oil offshore Guyana.” Belize signs a pair of UN pacts Noting that since ExxonMobil reported its discovery of hydro- carbons in its Liza-1 exploration well, the company and its joint venture partners have been working around the clock and EU-Cuba relations set to change that “first oil” is now “just a few short years away.” following signing of new agreement Mr Trotman said that the Government of Guyana, recognising that the amount of money that will circulate throughout the Former President Fidel Castro laid to rest economy because of the oil and gas finds, was developing plans and legislation as a national priority “to ensure that it is exploited in a manner that helps spur economic development and that such development is sustainable and equitable.” President Medina approves new budget for Dominican Republic Setting out eight areas in which government was introducing policies and laws regulating the industry, its taxation and the establishment of a Sovereign Wealth Fund Legislation, he said that Government intended to have draft legislation available Guyana: CDB approves major by December 31 this year. assistance package In his remarks to the Chamber, he said that government was determined that the income would benefit local communities FAO distributes agriculture supplies and was as interested in developing those Guyanese sectors to Haiti to save winter crop able to support the industry.

Noting that the oil and gas sector is extremely complex, requi- ring specialised skills and expertise, he said that Government Rosselló prepares to become Governor recognised the need for a highly skilled workforce. It would, of Puerto Rico therefore, revamp the public education system and “integrate the supply of labour into a flexible, technical vocational education and training system to rapidly raise skills.” Trinidad: Election results contested Continue on page 2 > Mr Trotman identified a number of skills of particular importance to the sector that need to be developed. These include in aviation, waste management, fuel supply, catering, security services, scaffolding, warehousing, janitorial services, housing and accommodation, schools, transportation, petroleum engineers, equipment operators, and roustabouts to undertake general labouring activities.

In his remarks, which also included detailed references to Guyana’s other extractive industries, the Minister noted the recent formation of an Oil and Gas Association of Guyana, observing that it was also working closely on oil and gas related initiatives with the country’s Private Sector Commission, and the Guyana Manufacturers and Services Association.

Meanwhile ExxonMobil has said that the Payara well has now been drilled to its total depth and the company is in the process of evaluating preliminary findings. While the Country Manager for the company, Jeff Simmons, would not be drawn by the local media on whether the preliminary findings were positive, Stabroek News, quoting its own sources, said that ‘while still early to affirm, the well shows positive promise similar to the company’s Liza-1 drilling results which has already seen huge projections of oil recovery’.

In early November of this year, after confirmation that the Liza returns would be on the upper end of the their estimated 800m to 1.4 bn barrels of oil equivalent, ExxonMobil moved exploratory drilling 10 miles northeast from Liza, to its Payara prospect. In October, the company said that it remained excited not only by Liza, which is world-class in its own right, but also by the significant further exploration potential of the very large Stabroek Block.

Separately Exxon has said that it expects to be able to agree the first phase of development in 2017 after having officially noti- fied Government in late November under Section 31 of the Petroleum Act that the find was commercial.

Recent industry estimates say that the Liza field would break even at US$40 per barrel. Present prices are around US$57 per barrel and set to rise if a recent agreement by OPEC and non-OPEC producers to reduce production, holds. Exxon has a 45% interest in the Liza field, with Hess holding 30%, and the remaining 25% belonging to China state-owned offshore oil producer CNOOC.

The full text of Mr Trotman’s speech can be found at http://nre.gov.gy/wp-content/uploads/2016/12/Keynote-Speech-GCCI-Gala.pdf

Key Trump team members know the region

Recent announcements of key appointments by the US President-elect, Donald Trump, include a number of figures with knowledge of the Caribbean, and the Americas more generally.

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02 INDEX They include as US Secretary of State, the Chief Executive of ExxonMobil, Rex Tillerson; as Deputy National Security Adviser, KT McFarland, Fox News’ National Security Analyst and a former adviser to a number of previous administrations; and as the future Head of Homeland Security, the former Head of Southern Command, the retired Marine Corps General, John Kelly.

Mr Tillerson, a controversial choice because of his close connections with the Russian President Vladimir Putin, is understood to be a pragmatist believing outcomes are more important than ideology. He has extensive geo-political knowledge and in his life-long roles at Exxon has developed high level relationships in a number of Caribbean and Latin American nations that have proven or prospective reserves of oil and gas.

Among the countries, he has recently taken a positive interest in are Guyana, Suriname and Trinidad. He is also understood to have been following the negotiations that have begun between Cuba, Mexico and the United States over the borders of the Western Polygon, a region in the Gulf of Mexico with sizable oil and gas deposits, but with unclear boundaries.

In contrast, soon after he became chief executive in 2006, he was involved in a confrontation over the renegotiation of industry contracts with the Government of the late Hugo Chavez in Venezuela. This led to Venezuela expropriating ExxonMobil’s assets and the company taking Venezuela to arbitration court where it eventually was awarded about one-tenth of what it said the assets were worth. Since then there has been an antagonistic relationship between Mr Tillerson and Venezuela. More significantly perhaps for the whole region, as Chief Executive of Exxon he has been clear that climate change is the result of human activity. Exxon supported the Paris Climate Agreement and said it favoured a carbon tax as an emissions-cutting strategy.

In contrast to Mr Tillerson, whose appointment is expected to attract intense scrutiny in the US Senate during confirmations hearings, KT McFarland, who has been designated as Deputy National Security Adviser and number two to the former General, Mike Flynn, does not require Senate confirmation.

Mrs McFarland is hugely experienced, having served in national security posts in the Nixon, Ford and Reagan administrations. She has previously made clear that she takes a positive if qualified view of détente with Cuba. Writing in December 2014, for Fox News’ “Opinion” section, she said that while President Obama’s policy of reopening relations with Cuba was the right thing to do, his decision should not have been concerned with correcting past mistakes, but about avoiding future ones.

In an op-ed commentary, she noted that the US “cannot allow its adversaries to once again dominate Cuba.” She added “whichever big power steps up first to offer, that will become Cuba’s major sponsor for a generation, and it will confer on that sponsor certain rights and privileges. We must take steps now to ensure that Cuba doesn’t become a Russian or Chinese pawn, and thus serve as a launch pad to threaten America’s security were they to establish a military presence.” Mrs McFarland also said “whichever major power helps Cuba enter the modern world will have enormous power there for a generation. That major power needs to be us.”

The decision by Mr Trump to appoint General Kelly as head of Homeland Security will bring to the post someone with well-known and strong views on the importance of the Cari- bbean and Latin America to the US.

As the former commander of the US Southern Command, he was vocal on a wide range of regional issues, including nar- cotics trafficking; organised crime; terrorism; migration; and the need for dialogue and stability in the Caribbean region. Prior to retiring in 2015, General Kelly was critical of the US policy of disengagement from the Central American and Ca- ribbean region and from the world in general.

In other comments, he has made clear that he opposed clo- sing the US detention centre at Guantánamo Bay in Cuba. In January 2016, he described Cuba’s participation in the annual Caribbean security conference—held this year in Ja- maica and also attended by the US military—as a significant development. This year’s event focused on pan Caribbean joint co-operation against drug trafficking and transnational crime. 03 INDEX ANguilla Elections draft bills published. The Constitutional and Electoral Reform Committee has presented a number of proposals for the draft Elections Bill and the draft Electoral Boundaries Bill, including:

• A census to be taken every 10 years, using 2017 as the initial year • Voters required to appear in person and prove that they are qualified to be registered • Elections to be held on the first Monday after the fifth anniversary of the previous general election • Elections officers and members of essential services allowed to vote before polling day • The number of elected members increased to 13 from the current 7 • The Electoral Boundaries Commission to set up 9 local electoral districts and 4 island-wide districts • The Chairman of the Commission to be appointed by the governor • The Commission authorised to confer power and duties on any public officer

Once the Commission submits the report to the House, and it is approved, the draft Elections Bill can be completed.

ANTIGUA Ultimatum for WTO sanctions. The government has warned the United States that it will suspend the co- & BARBUDA pyright on the sale of US intellectual property on December 31, 2016 if the US does not agree to a settlement of the ongoing gaming dispute. The World Trade Organization (WTO) awarded sanctions to Anguilla of US$250m in 2007 for revenue lost due to the US decision to prohibit offshore gaming based in Antigua and Barbuda. That ruling, the government says, has devastated the country’s economy not just through millions in lost revenues but thousands of lost jobs; an industry that once employed 4,000 now has a workforce of 500. Anti- gua has been seeking closure for the dispute since the WTO’s determination nearly 10 years ago.

ARUBA Tesla energy storage systems for Aruba. Tesla will assist Aruba in attaining its sustainable energy target of 100% green energy use by 2020 through the provision of energy storage systems. The water and electric utility WEB Aruba signed an agreement with the California-based alternative energy company in late Novem- ber, seeking to improve capacity of batteries and grid stability with solutions scaled to the industrial level.

BAHAMAS Boundaries changes to Parliament soon. The Constituencies Commission held its final meeting on re- commendations for boundaries changes on December 12. It is expected that the Commission will recom- mend an additional seat for New Providence as the lone major change to the electoral structure. The Com- mission’s report has been completed and is currently under review by opposition member K Peter Turnquest.

Butler-Turner rises to Opposition Leader. Long Island MP Loretta Butler-Turner was appointed Opposition Leader on December 11, the first woman to serve in that capacity in Bahamian history. The appointment co- mes after 7 Free National Movement (FNM) MPs withdrew their support for former Leader Hubert Minnis. Prior to the motion of no confidence, Minnis had served as Opposition Leader since 2012, when former Prime Mi- nister Hubert Ingraham retired from politics. Butler-Turner has appointed Democratic National Alliance (DNA) Leader Branville McCartney to Senate Leader of the Opposition.

Reforms for the aviation industry. Negotiations for reclaiming Bahamian airspace from the United States are expected to resume within the coming 2 weeks. The airspace has been managed by the US Federal Avia-

04 INDEX tion Administration (FAA) since the 1950s, costing the Bahamas significant revenues for its use by commercial airlines. Meanwhile, the Civil Aviation Authority (CAA) will see the Bahamian aviation industry separated from everyday airport functions. The new body will responsible for regulating the activities of the aviation industry. Previously, the Civil Aviation Department (CAD) had responsibility for regulating the industry and functioning as a service provider, an arrangement that was seen as out of line with international standards by the International Civil Aviation Organization (ICAO).

End in sight for opening of Baha Mar? Hong Kong-based conglomerate Chow Tai Fook Enterprises (CTFE) Limited has reached an agreement with the government and the Export-Import Bank of China (Exim Bank) to own and operate the Baha Mar resort. The company will pump US$200m into the project to expedite the final stages of construction. CTFE will launch Baha Mar in phases and intends initially to employ a workforce of 1,500. The Exim Bank is providing additional funding as well to complete construction.

BArbados Government backs Hilton upgrades. The Parliament has approved a US$6m guarantee for the Hilton Bar- bados Hotel to complete its US$11m renovation. Hotel operator Needham Point Holding Limited has contributed US$5m to increasing the room stock to 354 from 300 and refurbishing every room over a 3-year period (115 in 2015, 139 in 2016, and 100 in 2017). The government-owned hotel is profitable, according to Tourism Mi- nister Richard Sealy, and has contributed US$1.2m to public coffers for the year to date in 2016, a 56% increase over the same period in 2015.

IDB loan to change energy mix. Government will use a US$34m Inter-American Development Bank (IDB) loan to implement a public-private partnership (PPP) for liquefied natural gas (LNG) power generation. The project will see the Micro LNG plant enlarged to provide LNG for industrial and commercial purposes, increasing the island’s energy security and decreasing its carbon footprint. The loan will also be used to promote renewable energy use.

Sinckler: sugar still important. Finance Minister Chris Sinckler is seeking a US$35m loan from the Ansa Merchant Bank in order to provide a subvention to the sugar industry. Sinckler warns that, although the industry is less lucrative now than in the past, it remains an important component of the island’s economy, in spite of its more lucrative days being in the past. Sinckler said that any exit by Barbados from involvement in the sugar industry (as was undertaken in St Kitts and Nevis in 2005) must be well planned in order to prevent major economic fallout. Of the 5,000 Barbadian directly or indirectly employed by the sugar industry Sinckler says “if we cut it off, we cut them off,” referring to the possibility of the island making a “disorderly exit out of sugar.”

BELIZE Belize signs a pair of UN pacts. Belize acceded to the United Nations Convention Against Corruption (UN- CAC) on December 9. The UNCAC, the first international binding anti-corruption convention, is based on 5 pi- llars: Preventive Measures, Criminalisation and Law Enforcement, International Cooperation, Asset Recovery, and Technical Assistance and Information Exchange. The convention seeks to end domestic and foreign bri- bery, embezzlement, trading in influence, and money laundering. Additionally, Belize is the first country in the region to sign on to the UN Multi-Country Sustainable Development Framework (MSDF). The plan is active for the period of 2017-21, providing a framework for development cooperation that is tailored to national priorities, as laid out in Belize’s Horizon 2030 and Growth and Sustainable Development Strategy.

Sugar campaign underway. The new sugar crop season kicked off on December 5. Processors American

05 INDEX Sugar Refineries and Belize Sugar Industries Limited are hoping to mill the entirety of the estimated 1.4m ton- nes of available cane. The sugar season is starting on time for the second year in a row after delays in 2013 and 2014 resulting from a combination of damage to sugar roads from heavy rains and farmers and proces- sers unable to agree to terms on the payments for bagasse produced at factories. Farmers are expected to receive the highest payments for their cane in 16 years.

BRITISH Nanny Cay expansion greenlighted. Work on the new residential buildings at Nanny Cay will commence VIRGIN in January. The US$30m expansion project will also see the construction of new walkways, a wellness centre, ISLANDS a gym, retail space, social areas, and other amenities. The existing marina will also be expanded to 120 slips. Nanny Cay expects to add 100 jobs to its workforce. The property currently accounts for 300 direct and indi- rect jobs.

BVI Finance to broaden scope. BVI Finance rolled out its marketing and business development strategy for the period of 2017-20 on November 23. The event was an opportunity for BVI Finance to inform stakeholders of initiatives for promoting the financial services sector in the coming years, including key goals of:

• Establishing clear rules of engagement with key stakeholders • Promoting BVI Finance member services and products • Ensuring the BVI Finance team has the necessary resources and skills • Delivering research projects • Establishing a customer focused approach to business • Delivering an annual marketing plan • Delivering a media relations programme • Delivering a Business Development programme • Implementing a digital communications programme • Implementing a CRM system

BVI Finance also updated stakeholders on the transition to private entity BVI Finance Limited, which will take place over the next six weeks. BVI Finance Limited will function by guarantee as the promotional entity for the financial services industry through public/private partnership.

CAYMAN Voter registration extended. Registration for the 2017 elections has been extended to January 16. The ISLANDS deadline had previously been set for December 31. The elections take place on May 24, 2017.

Tourism plan to promote non-traditional attractions. A second round of tourism stakeholder meetings has taken place, with Government seeking input from the sector for the development of its 2017-2021 National Tourism Plan (NTP). Among the top goals of the plan is to find ways to spread tourists beyond the major attractions of Seven Mile Beach, the Cayman Turtle Centre, and Stingray City, with a particular focus on increasing tourism in Cayman Brac and Little Cayman. Meanwhile, Cayman can expect 50,000 more air arrivals and 400,000 more cruise arrivals in 2016 compared to 2013, according to Tourism Minister Moses Kirkconnell. That increase over the 3-year period will result in an additional US$61m in tourist spend.

First 737-800 arrives. Cayman Airways has received the first of its new generation of Boeing 737-800 airpla- nes, which touched down at Owen Roberts International Airport on December 2. The airline is phasing out all

06 INDEX 4 of its 737-300 aircraft over the next 4 years, with the first of the aging planes to be retired in June. Until then, the carrier will operate with an expanded fleet.

Port cost next month. The full cost of the port project is expected in January, says Tourism Minister Moses Kirkconnell. Netherlands-based engineering consultant Royal Haaskoning is proposing to move the cruise piers into deeper waters in order to decrease the amount of dredging that will have to be done, thereby mi- tigating some of the environmental impact that has made the project controversial. That decision however could push the cost from an estimated US$183m to as much as US$244m, potentially exacerbating another point of contention.

CUBA Cuba wishes to continue building US ties. Cuba has said that it wishes to continue working with the Uni- ted States “to build ties of peaceful co-existence and mutual benefit.” Josefina Vidal, the Director General for US Affairs at Cuba’s Ministry of Foreign Relations, speaking after the fifth US-Cuba Bilateral Commission meeting held in Havana on December 7, said that Cuba was willing to identify new opportunities and work “to build a different kind of relationship with the US - a civilised one based on respect - without making any kind of concession or renouncing principles to which the island is committed.” She went on to note that Cuba and its government hope that the new US administration will not only consider the results of the Bilateral Commis- sion over the past 15 months, but also those achieved since the process of rapprochement began. She noted that it was a process supported by most Cuban and US citizens, including most Cubans living in the US, and the vast majority of countries around the world.

EU relations set to change following signing of new agreement. The European Union and Cuba have formally reached a political dialogue and co-operation agreement. The agreement was signed in Brussels on December 12 by the EU High Representative for Foreign Affairs and Security Policy, Federica Mogherini, as well as by EU Foreign Ministers and the Cuban Foreign Minister, Bruno Rodriguez. Mrs Mogherini said that it marks a turning point in relations between the EU and Cuba and that the two nations are now moving towards a closer and more constructive partnership. “The EU is ready to support Cuba’s process of economic and social modernisation,” she said. The agreement, the first ever between the EU and Cuba, will provide a new legal framework for EU-Cuba relations. In parallel the EU has formally repealed its common position which had introduced political conditionalities into the relationship.

Former President laid to rest. The ashes of Fidel Castro were finally laid to rest on December 4 in Santiago de Cuba’s Santa Ifigenia Cemetery in a private ceremony for family members and specially invited guests. The site is marked by a large stone boulder from the Sierra Maestra bearing the word “Fidel.” Speaking in the central plaza in Santiago at the final tribute President Castro, said that in accordance with his brother’s wishes “he will not be immortalised in statues and public monuments.” In the preceding week, waving flags and singing the national anthem, hundreds of thousands of Cubans came onto the streets to bid farewell as Fidel Castro’s ashes were carried by road across the country following his death and cremation in Havana. The final ceremonial guard in Havana notably included just four members of the country’s political leadership: President Raul Castro; the Second Secretary of the Cuban Communist Party, José Ramón Machado Ventura; a Comandante of the Revolution, Ramiro Valdés Menéndez; and the First Vice President of the Councils of State and Ministers, Miguel Díaz-Canel Bermúdez, who were named in that order.

AZCUBA looking for an improved sugar harvest. The AZCUBA business group has said that 27 sugar mills are now operating in the country’s 2016-2017 campaign, mainly due to higher levels of cane becoming available earlier in the season than in previous years. According to Liobel Perez, an official at AZCUBA, a total of 54

07 INDEX mills, four more than in 2015-16, will operate by January. Cuba is forecasting a 12% growth in its sugar harvest as a result of the increased number of operational factories, the use of new mechanical harvesters and other equipment, and greater efficiency in processing the cane.

A longer and more detailed version of these and other stories on Cuba appears in Cuba Briefing, which is available by subscription or to Premier members of the Caribbean Council free of charge.

Curaçao Binding agreement signed with Guangdong Zhenrong. The government and the Chinese company Guangdong Zhenrong have entered into formal agreement regarding plans to move forward with the US$5.5bn energy project to upgrade Curacao’s refinery, including the expansion of oil storage and the construction of a new gas terminal. The China Development Bank would finance up to 85% of the project. The refinery will also seek to enter a supply deal with Venezuela’s state-owned oil company, PDVSA.

DOMINICA Work on hospital to commence in 2017. The Ministry of Health and Environment has issued a call for ten- ders for the design of the new Marigot Hospital. The facility is 1 of 3 in the region to have been selected as a smart health facility, as designated by the Pan American Health Organization. That designation requires the use of renewable energy and sustainable water use, among other benchmarks.

DOMINICAN President Medina approves Budget. Bill 690-16 represents an RD$711,399m (US$15,364m) fiscal plan for REPUBLIC 2017. Some of the items receiving year-on-year increases are: healthcare, education, and public safety. The ju- dicial branch has requested increases in its budget and received an RD$800m (US$17.3m) provision for 2017. The total budget increased by RD$47,700m (US$1,030m). Meanwhile, World Bank financing of US$100m and US$434.8m detailed in the Budget will help repair damages following the month-long heavy rainfall, which primarily impacted the northern part of the country.

Dominican Republic highest tourism earner. According to Tourism Minister Francisco Garcia, tourism income in the Dominican Republic will exceed US$6.4bn this year, positioning it as the country with the highest income in Latin America and the Caribbean. Garcia also announced that, during the next five years, 7 new hotels will be built to accommodate the industry’s growth and strengthen the Dominican Republic’s position as a tourism leader. Additionally, domestic consumption of goods and services from the tourism sector will reach approximately US$8.8bn according to the National Hotels and Restaurants Association.

Monetary policy rate unchanged. The Central Bank will maintain the country’s interest rate at 5.5%. The decision was made while awaiting more information regarding the possible consequences behind recent climate events. October registered an annual rate of inflation of 0.91%, and accumulated inflation for the January-October period stands at 0.65%. The underlying annual inflation reached 1.78%. November registered a year-on-year inflation rate of 0.88%, and accumulated inflation for the January-November period stands at 0.79%. The underlying annual inflation reached 1.79%.

grenada Throne speech emphasises healthcare, tourism. Governor General Cecile La Grenade delivered the

08 INDEX Throne Speech 2016, titled “Building on our successes,” to Parliament on December 2. La Granade indicated that the economy has rebounded strongly since 2014, that the debt and fiscal situation has improved, that unemployment is down, and that inflation is relatively low. For 2017, the government will focus on:

• Completing Phase ll of the General Hospital Project • Commencing construction of the Gouyave Health Centre • Implementing a National Health Insurance Plan • Improving Grenada’s ease of doing business standing • Implementing the ASYCUDA World System to simplify Customs procedures • Enacting the Bankruptcy and Insolvency Act to bring Grenada in line with modern insolvency regime standards • Reforming the Inland Revenue Department and Excise Division to improve the administration and collection of taxes

The commercialisation of several major tourism sites will be a priority for 2017 as will be the CIP to encourage investment in the tourism sector. Read more at the link here.

Budget statement delivered. Prime Minister and Minister of Finance Keith Mitchell presented the 2017 budget statement on December 9. Among the highlights of next year’s fiscal plan, titled “Working together to build on our successes for a better country,” are:

• Recurrent revenue of US$243m, current expenditure of US$222m, capital expenditure of US$57m, and an overall surplus after grants of US$20.7m. • Debt will be allocated US$160m, education US$38.5m, finance and energy US$29.6m, health US$29.6m, communications and works US$22.2m, pensions US$16m, police US$18.5m, social development and housing US$14,6m, youth and sports US$12.7m, and economic development US$10m.

Read more at the link here.

GUYANA CDB approves major assistance package. The Caribbean Development Bank (CDB) has approved US$194m in assistance for Guyana. The funds will be used to back the country strategy for Guyana for 2017-21, particularly in the areas of socioeconomic development (including poverty reduction), environmental sustainability and good governance. Of that amount, US$65m will come via the UK Caribbean Infrastructure Partnership.

Gold keeping economy afloat. Finance Minister Winston Jordan, who delivered the G$250bn (US$1.21bn) budget statement on November 28, has called Guyana’s economic performance for the year, which featured a rate of GDP growth of 2%, “dismal.” The performance is seen as particularly sluggish considering that growth had been projected at 4.4% for the year. Jordan has stated that key industries such as sugar, rice, forestry, construction and wholesale and retail trade are showing signs of “distress,” and that only gold is providing any real boost.

Opposition: withdraw budget. Government has stated that the 2017 Budget delivered earlier this month will not be “withdrawn” after Parliamentary Public Accounts Committee (PAC) Chairman Irfaan Ali opened the budget debates with a call to do so. Ali also called on the coalition government to sit down with the opposition People’s Progressive Party/Civic to craft a new budget that is free of “inaccuracies” and does not include what Ali calls “punitive taxes.” The new formula for income tax will increase every resident’s take home pay, according to the Guyana Revenue Authority. Finance Minister Winston Jordan announced in his recent Budget pre-

09 INDEX sentation that a person’s income tax will be determined in proportion to gross earnings. Those earning less than G$180,000 (US$869)/month will be taxed at 28%. Earnings above G$180,000 will be taxed at 28% and 40% for every dollar of chargeable income, with a limit set at 1/3 of salary. Meanwhile, the new value-added tax (regime) will drive up prices and the rate of inflation, says the Private Sector Commission (PSC). Government Accounting firm Ram and McRae’s post budget analysis of the VAT indicates that the Caribbean Regional Technical Assistance Centre and Guyana’s Tax Reform Commission recommended rates of 16 and 8% and 14 and 7%, respectively. Government intends to decrease the VAT from 16% to 14% next year, but will impose the tax on water and electricity as “conservation measures.”

More funds for CJIA. The 2017 Budget allocates another G$9bn (US$43.4m) to the Cheddi Jagan Internatio- nal Airport (CJIA) expansion project. Guyana has already spent more than G$9.5bn (US$45.8m) on work that includes extending the runway to 10,800 feet and modernising the terminal buildings.

HAITI Haiti does not take advantage of its trade agreement benefits. According to Haiti’s Monitoring Office of the Free Trade Area of the Americas (FTAA) and CARICOM, the nation has access to numerous trade benefits that are currently underexploited. As FTAA’s only underdeveloped country, Haiti enjoys customs duty exemp- tions on exports for 97% of items sold to the European Union and Canada. It also has preferential access to CARICOM’s single market and economy. Yet, a lack of capital inflows has halted the development of domestic production. Indeed, foreign direct investment stocks in Haiti are around US$1bn, while they reach US$30bn in neighbouring Dominican Republic. Moreover, adopting CARICOM’s common tariffs could lead to inflation if the country does not secure enough local supply.

FAO distributes agriculture supplies to save winter crop. The United Nations Food and Agriculture Or- ganization (FAO), in collaboration with the Ministry of Agriculture, Natural Resources and Rural Development (MARNDR), are distributing seeds and tools to support families affected by Hurricane Matthew. Supplies for short-cycle crops are expected to reach more than 25,000 households by mid-December, including 5,400 in Grand’Anse, 15,150 in Sud, 2,000 in Nord-Ouest, 1,500 in the Artibonite, and another 1,000 across Sud-Est and Ouest, plus 1,500 fisher families and 2,000 herder families. There is still US$5.6m missing from the US$9m needed to provide immediate assistance to nearly 300,000 directly affected people. In the long run, this gap amounts to around US$28m, as 1.4m Haitians need food assistance to overcome the consequences of post-hurricane crop losses that are valued at US$580m. The World Food Program (WFP) is also taking part in this kind of aid provision.

JAMAICA Signatories of partnership assure support. The signatories of the Partnership for a Prosperous Jamaica, which include the Jamaica Environment Trust, the Jamaica Civil Service Association, the Jamaica Confedera- tion of Trade Unions, and the Private Sector Organization of Jamaica, have assured the government of their support for the project. The agreement calls for inclusive economic growth and job creation, public sector transformation, adherence to the rule of law and timely justice outcomes, national debt reduction, enhanced macroeconomic stability, and increased tourism flows and inter-sectoral linkages.

Agriculture sector to boost economy. The President of the Jamaica Agricultural Society, Norman Grant, has said that the Eat Jamaican Campaign has been very important in helping the country pass 14 performance assessments under the International Monetary Fund’s (IMF) oversight. The output for the Agriculture sector went up 28% in the third quarter of the current fiscal year. By producing more food, supplies increase, in-

10 INDEX flation remains low, and international reserves remain stable—requirements established by the IMF. Grant is asking the government to allocate US$3.9m for the repair of farm roads in the next budget (up from US$1.5m the previous year) as he sees a strong correlation between good road conditions and increased production.

Jamaica set to deepen relations with Cuba. Jamaica’s Prime Minister, Andrew Holness, has said that Ja- maica and Cuba have agreed “in the light of new dynamics in US/Cuba relations” to identify ways to deepen collaboration and exchanges in the areas of trade, tourism, climate change and disaster mitigation, as well as culture and education. Speaking in the House of Representatives on November 6, where he led tributes to the former President of Cuba, Fidel Castro, Mr Holness said that the two nations had recently signed a multi-des- tination agreement to market the Caribbean as a single product and was exploring a stronger mechanism for co-operation in culture, music and the creative industries. Mr Holness said that Cuba was an important part of the Caribbean community and represented a strong potential ally for trade and investment.

puerto Rosselló prepares to become Governor of Puerto Rico. Ricardo Rosselló of the New Progressive Party rico defeated the Popular Democratic Party’s (PDP) David Bernier in the November 8 election to win the governor’s seat by a vote of 655,626 (41.76%) to 610,956 (38.92%). Supreme Court Chief Justice Maite Oronoz will swear in Rosselló on January 2. In the meantime, the Governor-elect has been naming his appointments:

• Luis Gerardo Rivera Marín: Secretary of the State Department • Rafael Rodríguez Mercado: Secretary of Health • Andrés Waldemar Volmar Meléndez: Secretary of Sports and Recreation • Fernando Gil Enseñat: Housing and Urban Development • Glorimar Andújar Matos: Family Department Secretary • Waleska Maldonado Claudio: Director of the Child Support Administration • Jesús Vélez Vargas: general coordinator of the Office for Socioeconomic Financing and Self-Management • Michael Pierluisi Rojo: Secretary of the Department of Consumer Affairs • Yennifer Álvarez Jaimes: Press Secretary in Fortaleza • Carlos Contreras: Secretary of the Department of Transportation & Public Works and Executive Director of the Highways & Transportation Authority

Activist and political commentator Rosselló is the son of former Governor Pedro Rosselló. PDP Incumbent Alejandro Padilla did not seek a second term.

Legislation would increase wages, increase opportunity US Senator Marco Rubio (R-FL), a member of the Congressional Task Force on Economic Growth in Puerto Rico, introduced the Economic Mobility for Productive Livelihoods and Expanding Opportunity Act. The legislation would seek to establish an opt-in system by which participating employers disburse pay rises to all employees earning below the median hourly wage in Puerto Rico.

ST kitts Harris delivers US$264m budget. Prime Minister and Minister of Finance Timothy Harris presented the & nevis Budget for 2017 on December 7. Revenues are projected to be US$237m. Recurrent expenditure is expected to be US$189m, while capital expenditure and net lending is projected at US$54m. PM Harris is anticipating an overall surplus of US$12.4m and a primary surplus of US$22m. Hear the full Budget statement here.

11 INDEX Amory presents US$87.5m budget. Nevis Premier and Minister of Finance Vance Amory presented his 2017 Budget address to the Nevis Island Assembly on November 30. The budget for the coming financial year projects a 22.42% increase over 2016. Projected revenue is US$52m. Recurrent expenditure will come in at US$58.1m, with capital expenditure at US$29.3m. Nevis can expect a deficit of US$6.3m for 2017. Read more at the link here.

ST Pearl will bring jobs, growth. Construction of the Pearl of the Caribbean resort will begin in 2017, according LUCIA to developer DSH Caribbean, an affiliate of Hong Kong-based Desert Star Holdings Ltd. The US$2bn integra- ted development project, which will include a casino, horse racetrack, shopping mall, free trade zone and entertainment facilities in addition to housing, is expected to help transform the economy of the southern part of the island. Ground was broken on November 25.

ST Spending increase for new financial year. The draft 2017 Budget has increased US$9.5m year-on-year MAARTEN (YoY) to US$216m, according to finance minister Richard Gibson. The spending plan includes US$35.4m in capital expenditures. While the 2016 budget included across-the-board 10% spending cuts for all ministries, the new fiscal year will see increases or a return to former levels.

Joint sewerage project stalls. Government has decided to suspend discussions with French St-Martin on the development of a joint sewerage project. The decision was made due to tensions between the countries. Dutch St Maarten will redirect the US$3.1m that had been allocated for the plant and an additional US$7.3m for connections to homes and businesses to other projects.

ST VINCENT Tourism numbers climbing; AIA to open shortly. Prime Minister Ralph Gonsalves has again stated that & THE the opening of the Argyle International Airport (AIA) is “imminent.” Even so, Gonsalves has declined to offer an GRENADINES official opening date. Heavy rains have caused setbacks over the past 6 weeks, including the collapse of the road outside the facility. Meanwhile, tourism arrivals increased 5.7% year over year (YoY) through the first 8 months of the year, according to Minister of Tourism Cecil McKie. Air arrivals increased 6.3% in August, while sea arrivals were up 5.4%. The World Bank and International Monetary Fund anticipate that the opening of AIA will bring a further 10% increase in visitor arrivals.

PM: Healthcare a priority. Eight healthcare facilities around St Vincent and the Grenadines have been marked for retrofitting, as confirmed by the Pan American Health Organization (PAHO), which is collaborating with the UK on the SMART Health Care Facilities in the Caribbean project. Facilities chosen after 18 months of research include Chateaubelair Hospital, the Barrouallie Health Centre, Georgetown Clinic, Stubbs Polyclinic, Clifton Hospital (Union Island), Port Elizabeth Health Centre (Bequia), Mayreau Clinic, and Sandy Bay Clinic. Meanwhile, the Mental Health Rehabilitation Centre at Glen reopened on December 7. During the opening ceremony, Gonsalves noted that a significant portion of the country’s GDP is spent on healthcare and that annual spending is higher than the CARICOM average.

SURINAME EXIM to fund major works. Government is seeking to borrow US$350m from the Export-Import (EXIM) Bank

12 INDEX of China, with the Council of Ministers already approving that initiative. Of that total, US$235m would be used to develop Suriname’s road network by means of the Dailan 4 project. Another US$116m would be pumped into Telesur’s broadband network. Government and the bank are arranging a 20-year loan at 2% annually and with a 5-year grace period.

Electrification project gets funding. The Caribbean Development Bank (CDB) has approved a US$65m loan to expand electrification projects across Suriname and to upgrade the Energy Companies of Suriname (EBS) so that the state-owned utility can deliver power more efficiently and sustainably. Suriname will also construct 5 new substations and renovate another 3 existing ones. Three solar plants will be constructed by 2021 as well.

Study shows acceleration in deforestation. Mining was the top contributor to deforestation from 2000 to 2015, accounting for 73% of all deforestation activity. Other leading contributors were infrastructure development, urban development, and agriculture. Over that period, deforestation has increased to 0.1% annually from 0.02%. The study was conducted by the National Institute of Environmental Research in Suriname and the Foundation for Forest Management and Production Control.

TRINIDAD Election results contested. Orville London, Chief Secretary of the Tobago House of Assembly (THA), has & TOBAGO replied to claims by the Opposition that Tobago local elections could not be held until after the ones in Trini- dad because of undoe influence by Trinidad. He stated that under the THA Act, the Prime Minister, the Chief Secretary, and the President will set the date for the elections between 2 and 3 months after the dissolution of the Assembly, which occurred November 17. The latest results of the November 28 local elections in Trinidad show the United National Congress party with 180,758 votes compared to 174,754 for the People’s National Movement party. Voter turnout was calculated at 34.34%, the lowest since 2003. Both parties are claiming a win, pending the final tally.

US VIRGIN WICO invests in port. The West Indian Company (WICO) says St Thomas is one of the most requested ports ISLANDS of call by passengers in the Eastern Caribbean. WICO entered into preferred berthing agreements with Car- nival and Norwegian Caribbean lines and has a single tariff agreement with the VI Port Authority to charge US$13.40 per passenger. WICO is spending US$9.7m to upgrade the docks and is working to enhance the passenger’s shopping experience with major multi-million dollar capital improvement projects, one of which is the US$1.8m Havensight Mall Refurbishment project, to be completed this month. The dock improvements will allow the largest of the cruise ships to berth, but WICO must partner with VIPA to fund the widening of the harbour entrance.

JFL hospital might not get Medicare payments. The Center for Medicare and Medicaid (CMS) has given the JFL Hospital until December 9th to submit an acceptable plan of correction to the many flaws the CMS found in a recent inspection. If the flaws are not corrected in time, the hospital will not receive Medicare or Medicaid reimbursements from the federal government. This has forced Governor Kenneth Mapp to solicit from the Senate an increase of the US$10m subvention to US$20m in order to correct the problems, which include mould, falling ceiling tiles, and a malfunctioning air conditioning system. The Hospital did submit a plan of correction on December 9, as required by the CMS.

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