OUR UPCOMING WORKSHOPS!
WORKSHOP DATE COUNTRY
Corporate Valuation Bootcamp 12th & 13th February 2020 Jamaica
SME eSmart- Powering Your Potential Find out more today by calling: (868)-627-8879 ext. 228 or email: [email protected]
Latest Rating Actions by CariCRIS
▪ The Pegasus Hotels of Guyana Limited reaffirmed at CariBBB- ▪ National Flour Mills Limited’s rating reaffirmed at CariA- ▪ The Belize Bank Limited’s rating assigned at CariBBB- ▪ Jamaica Public Service Company Limited’s rating upgraded to CariA- ▪ Saint Lucia Electricity Services Limited’s rating reaffirmed at CariBBB ▪ Endeavour Holdings Limited’s TTD 400 million bond issue rating reaffirmed at CariA+ ▪ Government of Barbados’ rating upgraded to CariBB- ▪ TRINRE Insurance Company Limited’s rating reaffirmed at CariA- ▪ JMMB Group Limited rating assigned at jmA ▪ Government of St. Lucia’s proposed bonds’ rating assigned at CariBBB ▪ Telecommunication Services of Trinidad and Tobago rating downgraded to CariA- ▪ Trinidad and Tobago Mortgage Finance Company Limited rating reaffirmed at CariAA- ▪ The Government of Anguilla rating reaffirmed at CariBBB+ ▪ NCB Financial Group rating upgraded to CariA+
Please visit our website at www.caricris.com for the detailed Rationales on these and other ratings
Benefits of a CariCRIS Rating to a Bank:
• Facilitate the placement of debt issues to a wide investment base
• Increase the flexibility of funding sources • Promote the adoption of stronger risk management practices
CariCRIS’ credit ratings and daily Newswire can also be found on the Bloomberg Professional Service.
REGIONAL
Trinidad and Tobago
CIF jumps to $28.52 OVERALL market activity resulted from trading in 13 securities of which eight advanced, three declined and two traded firm.
Barbados
More efficient NIS in 2020 Despite a reduction in staff numbers, the National Insurance Department processed significantly more claims in 2019 than it did last year.
$150m boost for BERT Government’s economic reform programme has received another $150 million injection from the Caribbean Development Bank (CDB), and under concessional terms previously inaccessible to the country.
Changes to income tax band Changes to personal income tax (PIT) which were announced in the 2019 Budgetary Proposal and Financial Statement will come into effect from January 1, 2020.
Card switch moves Minister of Small Business and Entrepreneurship Dwight Sutherland is calling on the credit union movement to create a locally issued pre-paid debit card system to replace the Caribbean Integrated Financial Services Inc. (CariFS) network scheduled to end in September 2020.
IDB report says government transactions burdensome The length of time it takes to carry out a transaction with government agencies continues to be a sore point for citizens, according to one of Barbados’ development partners who is recommending that improvements take place more quickly.
Sagicor looks to buy back Fresh from an ownership change that has left it holding more cash, Sagicor is looking to buy back US$320 million in securities from institutional investors overseas.
Jamaica
Digicel bonds down by one-third since January Investors can buy telecommunications company Digicel bonds at roughly 30 per cent cheaper than in January this year as downgrades put pressure on prices.
The LAB grew cash fourfold in the year Limners and Bards Limited, which trades as The LAB, beat market expectations which pushed the stock higher, but the company itself amassed a pile of cash which grew fourfold in the year.
Chukka raising more than US$50m for Caribbean expansion Chukka Caribbean Adventures is in the market for more than US$50 million of debt and equity to finance a range of projects that are intended to double the size of the business over the next six months to a year. The Jamaican business that now operates 85 tour packages at 15 locations here and in Belize and the Turks and Caicos Islands, is spreading its wings to The Cayman Islands, the Dominican Republic (DR), and Barbados as the first step in a larger vison to grow the business to between 10 and 15 countries in a five to seven years’ timeframe.
SECOND EXTENSION FOR MPC CARIBBEAN RIGHTS ISSUE A less than anticipated take up of MPC Caribbean Clean Energy US$22.8 million rights issue has resulted in a second extension of the offer.
US$452-million Kingston port modernisation project nearing completion The US$452-million port modernisation project is moving towards completion in Kingston, and it is already remaking Jamaica's major port.
Sagicor Manufacturing and Distribution Select Fund lists on JSE Sagicor Manufacturing and Distribution Select Fund listed on the main market of the Jamaica Stock Exchange (JSE) on Wednesday, December 18, 2019, after successfully raising over $2.7 billion from over 5,000 applications.
Jamaica records best tourism numbers — Bartlett Tourism Minister Edmund Bartlett has reported that the high stopover visitor arrivals and earnings for December are unprecedented in the island's tourism history.
Jamaica Continued
New 194 MW natural gas power plant up and running THE new 194 megawatt (MW) natural gas power plant in Old Harbour, St Catherine is now operational, Jamaica Public Service Company (JPS) announced Monday night.
Paypal and Paymaster Paypal through their Xoom international money transfer services has said that in collaboration with local bill payment provider, Paymaster, they have launched a fast, secure and easier bill payment option for Jamaicans living in the Diaspora to provide financial support to their loved ones back home.
Guyana
Banks DIH records $14.4% after tax profits for 2019 FOOD and beverage giants, Banks DIH Limited, has recorded a 14.3% after-tax profit for the year 2019 and the shareholder company is optimistic in its economic outlook with the arrival of ‘first oil’.
Guyana, Suriname sign historic tourism pact AFTER a two-year gestation period of negotiating, drafting and refining, Guyana and Suriname signed a historic tourism accord, on Monday, within the Boardroom of the Ministry of Trade, Tourism and Industry of the Republic of Suriname.
Guyana becomes associate member of Int’l Sovereign Wealth Fund body Guyana is now the latest associate member of the International Forum of Sovereign Wealth Funds (IFSWF). Formed in 2008, the IFSWF is a voluntary organization of countries with sovereign wealth funds committed to working together and strengthening the community through dialogue, research and self-assessment.
The Bahamas
Capital Markets Eye $200m ‘Busiest Year’ A top investment banker is predicting the Bahamian capital markets will have one of “the busiest years” ever in 2020 with around $200m worth of deals needing funding.
St. Vincent and the Grenadines
RBC blasts union as RBTT workers stay away from work in SVG RBC Royal Bank on Friday described as “sudden and unexpected” the industrial action, which it said was commenced by the Commercial Technical and Allied Workers’ Union (CTAWU), which represents its workers in St. Vincent and the Grenadines.
Only $5m of $15m for ganja licences collected — PM Only five to six million dollars of the 15 to 16 million dollars that authorities in St. Vincent and the Grenadines have approved for medical marijuana licences have reached the state coffers, says Prime Minister Ralph Gonsalves.
Other Regional
Curacao signs agreement with Klesch to operate Isla refinery Curacao’s state-run refining company, Refineria di Korsou (RdK), said it has signed an agreement with industrial commodities conglomerate Klesch Group to operate the island’s 335,000-barrel-per-day Isla refinery and storage facilities.
Caribbean economies lag in terms of reforms – World Bank The World Bank says economies in Latin America and the Caribbean continue to lag in terms of reforms as it relates to doing business in the region.
Investment in renewable energy in Latin America reaches historical levels Latin America surpasses Asia-Pacific to become the second most popular region for solar and wind energy projects
INTERNATIONAL
United States
Dollar eases, on track for smallest return in 6 years as risk appetite revives The dollar dipped to a near three-week low against the yen in thin year- end volume on Tuesday as investors favored riskier assets, led by renewed optimism about global growth.
United States Continued
Ford says reservations full for high-end version of electric Mustang Mach-E Ford Motor Co (F.N) said on Monday reservations were full for the high- end Mustang Mach-E First Edition electric sport utility vehicle.
Uber, Postmates sue to block California gig worker law, claiming it's unconstitutional Ride-hailing company Uber Technologies Inc and courier services provider Postmates Inc asked a U.S. court to block a California labor law set to go into effect on Wednesday, arguing the bill violates the U.S. Constitution.
Lockheed Martin hits 2019 F-35 delivery target of 131 jets Lockheed Martin Corp (LMT.N) said on Monday it has reached its 2019 target to deliver 131 F-35 fighter jets to the United States and its allies, as the defense contractor built 47% more jets this year.
United Kingdom
Britain says will raise minimum wage by more than 6% in 2020 Britain’s national minimum wage will rise by more than 6% next year, taking it to 8.74 pounds an hour, the government announced on Tuesday.
Europe
Euro gains and sterling shines as growth optimism cheers investors After staying strong for much of 2019 thanks to the relative outperformance of the U.S. economy and investors’ preference for a safe- haven currency amid the trade dispute between Washington and Beijing, the dollar’s gains for the year have shrivelled in December.
China
China adjusts CFETS index basket, cutting dollar weighting China will adjust the weighting of a key yuan index in the new year, the country’s foreign exchange trading platform said on Tuesday.
China's mutual fund industry had a record year of product launches: Shanghai Sec News China’s mutual fund industry witnessed a record year of product launches in 2019, the official Shanghai Securities News reported on Tuesday.
China Continued
China issues first 2020 fuel export quotas, up 53% from year ago China has raised the volumes of its first batch of 2020 fuel export quotas by 53% from a year earlier to 27.99 million tonnes, according to a document from the Ministry of Commerce that was reviewed by Reuters on Tuesday.
China outbound M&A plummets to 10-year low on trade tensions, economic slowdown China’s outbound mergers and acquisitions (M&As) clocked their weakest year in a decade in 2019, as an escalated U.S.-China trade war and tightened regulatory scrutiny of Chinese companies impacted appetite for overseas deal-making.
India
Indian PM Modi's office proposes waiving carbon tax on coal Indian Prime Minister Narendra Modi’s office has proposed waiving a tax on coal to help finance pollution-curbing equipment, according to documents, but the move would also make coal more competitive in price with solar and wind energy.
Global
Oil prices set for biggest yearly rise since 2016 Oil rose on the last trading day of the decade on Tuesday and was on track for monthly and annual gains, supported by a thaw in the prolonged U.S.-China trade row and Middle East unrest.
Banks DIH records $14.4% after tax profits for 2019 Tuesday 31st December, 2019 – Guyana Chronicle
FOOD and beverage giants, Banks DIH Limited, has recorded a 14.3% after-tax profit for the year 2019 and the shareholder company is optimistic in its economic outlook with the arrival of ‘first oil’.
According to the annual report of the company for the financial year ending September 2019, the percentage increase represents earnings by $611M when compared to 2018.
Chairman of the company, Clifford Reis, stated in his report that profit after tax attributable to shareholders of the parent entity was $4.897B; for 2018 the figure stood at $4.286B. He said that investments by Banks continued this year.
Reis listed the installation of increased storage capacity of potable water and equipment to accommodate increased production for the Ice Cream products and new flavours of Frostee Products among the factors for the improved results for 2019.
He said that the Trisco modernization project continued in 2019 with the installation of new packaging equipment to produce new and exciting packages for biscuits. The list include those for the Midwest range of biscuits and cookies as well as whole wheat crackers.
Reis said too the expansion of the security system via the installation of additional night vision cameras, as well as the installation of additional freezers, beverage coolers and water dispensers were among the progressive moves made by Banks in 2019.
Plans for 2020
He also noted the measured transition by Banks to the use of solar energy at the Qik Serv restaurants and that, he said, resulted in reduced energy charges.
Looking forward to 2020, Banks will focus its capital expenditure primarily on capital equipment for beer bottling plant. He said that would encompass the procurement and installation of an ‘uncaser’, a case packer, conveyors and a labeller.
He said that additional aspects of the capital expenditure will be expended on the purchase of trucks and lift trucks to further the selling and distribution activities.
Reis said that in 2020, the company will focus its capital expenditure on the construction of the new multi-level vehicle parking facility and “Banks Automotive and Services Inc” at Demerara Park , opposite Thirst Park.
Citizens Bank is a 51% subsidiary of Banks DIH and Reis said that that company recorded an after-tax profit of $955.3M, an increase of 58.6% when compared to the $602.3M in 2018.
Challenges
Reis said that for the greater part of 2019, the company faced some challenges and those included adjustment to rising fuel prices. He said that that bottleneck, among others, required “prudent management of our financial and human resources.”
In a direct reference to shareholder value, Reis said that despite the competitive environment in which it conducted business, the management of the company continued to focus on developing the innovating new business initiatives which can produce long-term growth.
Community relations
In his report, the chairman also noted that the company continued to honour its community relations and partnerships. He said that the relationship therein, continued to be mutually beneficial.
Banks, it was pointed out, was engaged in sponsoring brand ambassadors’ sports activities, religious events and bursary awards, among others. It also made commitments to the community as part of its business strategy.
Recently, oil production officially commenced here and Reis said, briefly, that an “Optimistic Economic Outlook” was envisioned with the arrival of first oil.
Reis said that the company continued to examine its core responsibilities to respond “to new opportunities that may be available which can be incorporated into our business models.”
Banks DIH will host its 64th annual general meeting on Saturday January 25, 2020.
<< Back to news headlines >>
Guyana, Suriname sign historic tourism pact Tuesday 31st December, 2019 – Guyana Chronicle
AFTER a two-year gestation period of negotiating, drafting and refining, Guyana and Suriname signed a historic tourism accord, on Monday, within the Boardroom of the Ministry of Trade, Tourism and Industry of the Republic of Suriname.
Signing on behalf of Guyana was Minister of Business, Haimraj Rajkumar, while Minister of Trade, Tourism and Industry, Stephen Tsang signed on behalf of Suriname. Witnessing the ceremony on the part of Guyana was the Director General of Tourism, Donald Sinclair, and the Charge D’Affaires of the Guyana Embassy in Suriname, Malvie Talbot.
From Suriname, the signing was witnessed by Mrs. Rachel Koningsbloem- Pinas, Permanent Secretary for Tourism and Mrs. Yvette Rokadji, Permanent Secretary for Trade in the Ministry of Trade, Tourism and Industry of Suriname.
The Guyana-Suriname Tourism Accord is a framework Cooperation Agreement that will underpin efforts in both countries to increase tourism business between the two territories and enhance the growth of a sustainable tourism product that will attract larger numbers of visitors to Guyana and Suriname.
Donald Sinclair, Director General of Tourism, explained that the Tourism Accord is viewed as a very timely and strategic mechanism, coming as it does in the midst of preparations for the February 2020 Tourism Expo of the Guianas which Guyana will be hosting at the Arthur Chung Conference Centre.
He noted that the vision, hopes and planning for such a Tourism Accord date back almost two decades and that long antecedence speaks to a common and shared national vision that has been kept alive through successive administrations in both countries.
He said that even as the current tourism principals celebrate the December 30th formal signing, the debt to past tourism ministers and actors is one that is happily acknowledged.
After the signing, tourism representatives of both Guyana and Suriname met informally to outline the immediate steps to activate the Accord.
Key among those is the establishment of a Guyana-Suriname Tourism Cooperation Council, to be convened within one month of the signing.
This Council will oversee all actions arising from the Accord, and will comprise three representatives from each country, drawn from both the public and private sector.
<< Back to news headlines >>
Guyana becomes associate member of Int’l Sovereign Wealth Fund body Tuesday 31st December, 2019 – Kaieteur News
Guyana is now the latest associate member of the International Forum of Sovereign Wealth Funds (IFSWF). Formed in 2008, the IFSWF is a voluntary organization of countries with sovereign wealth funds committed to working together and strengthening the community through dialogue, research and self-assessment.
This newspaper understands that the associate membership application for Guyana’s Natural Resources Fund (NRF) was approved by the IFSWF Board on December 11, last.
Chief Executive of the IFSWF Secretariat, Duncan Bonfield said that the decision to approve Guyana’s application was based on the assessment that the nation’s Natural Resource Fund “had proven willingness to uphold the member undertakings as set out in the IFSWF membership agreement, including endorsing, on a voluntary basis, the Santiago Principles.”
The Santiago Principles consists of 24 generally accepted principles and practices voluntarily endorsed by IFSWF members. It seeks to promote transparency, good governance, accountability and prudent investment practices while encouraging a more open dialogue and deeper understanding of SWF activities.
The assessment by the Secretariat would be in stark contrast to criticisms which were spewed by the political opposition for over a year. The People’s Progressive Party has said that the Minister of Finance has too much control over the Fund, as he has to appoint members to key committees in charge of investments and withdrawals that would be made.
Along with hearty congratulations, Bonfield has since informed the Ministry of Finance that while there is no annual membership fee for associate member status, the usual expectation is that a fund will remain as an associate member for a maximum of three years before applying to become a full IFSWF member.
NRGI ADVICE TAKEN
In November 2018, Kaieteur News was the first to report one of the key pieces of advice offered by the Natural Resource Governance Institute (NRGI) to the coalition administration.
That transparency body had said that if the Government of Guyana is truly serious about ensuring that transparency and accountability are the underlying principles of the Natural Resource Fund (NRF), then it will seek without hesitation, to join the revered International Forum on Sovereign Wealth Funds.
The Natural Resource Governance Institute reminded that IFSWF members had agreed from the inception to have a set of principles called the Santiago Principles, and practices for Sovereign Wealth Funds.
The NRGI said that these principles, adopted in 2008, emerged from two fears: First, countries receiving Sovereign Wealth Fund (SWF) investments worried that large government investors might use their financial power to pursue political or strategic objectives rather than purely financial returns. Second, since SWFs are large and growing in size, failure of just one of the world’s largest SWFs could trigger a global financial crisis.
The Institute noted that the 24 voluntary principles are broken down into three sets of standards: legal framework, objectives, and coordination with macroeconomic policies; institutional and governance structure; and investment and risk management framework.
The transparency body said that they are meant to encourage SWFs to behave openly and predictably and to seek financial returns rather than support a foreign policy agenda. It said that openness, predictability and market orientation, in turn, are expected to ease recipient country fears of predatory investments and promote sound internal fund management.
NRGI stated, “Being a member of the IFSWF and agreeing to the Santiago Principles provides an incentive to publish key information, make clear the roles and responsibilities of key bodies and make decisions openly.
“Though the principles are voluntary, peer pressure and a desire to be perceived in a good light by the international community and by recipients of SWF investments can encourage compliance. In fact, there is evidence that belonging to the IFSWF may have a positive effect on fund transparency and governance.”
It added, “An examination of Economist and Fund Expert, Edwin Truman’s, SWF Scoreboard scores shows that members of IFSWF in 2012 improved their fund scores by 17 percent on average between 2007 and 2012, whereas those who were not members improved by only five percent on average.”
NRGI said that on the other hand, countries which are members of the IFSWF but who do not comply with the majority of the principles, such as Qatar and the United Arab Emirates, have seriously undermined their own international credibility.
<< Back to news headlines >>
Capital Markets Eye $200m ‘Busiest Year’ Monday 4th December, 2019 – Tribune 242
A top investment banker is predicting the Bahamian capital markets will have one of “the busiest years” ever in 2020 with around $200m worth of deals needing funding.
Michael Anderson, RoyalFidelity Merchant Bank & Trust’s president, told Tribune Business “the trick” will be to ensure there is sufficient capital available at exactly the time different companies and groups are seeking financing.
He argued that it will be “a year of change” for both those issuing securities and investors buying into them, with each forced to move beyond the commercial banking system as a source of financing and savings returns, respectively.
The RoyalFidelity chief suggested there was sufficient demand to “double” the typical number of annual capital market transactions, while the size of fund-raisings is also set to increase from $10m-$15m to $30m and $100m deals.
“It looks like it could be the busiest year in a long time,” Mr Anderson revealed. “For so many years we’ve had three to four transactions per year. This next year we’re probably going to end up with double that, and larger transactions.
“Instead of $10m-$15m transactions you’re going to get $30m transactions and $100m transactions. Somewhere in the region of a couple hundred million dollars will come to market. Bigger transactions and more of them, so it’s going to put a strain on the availability capital when it’s needed.
“It’s going to be very busy in terms of people looking for capital, and will create an opportunity for investors to put their money to work and enjoy better returns. If it works properly, we will have people move out of the banks and put their funds to work by making more money available for people as they require it.”
Among the known financing transactions in the pipeline is the $71m local component of the Bahamas Power & Light (BPL) bond issue, which the state-owned utility and the Government are hoping to place early in the New Year.
Mr Anderson, though, suggested this deadline may be tough to meet given the need for the full $650m capital raise to obtain a rating from the credit rating agencies before it can be priced. He said the industry standard was that it typically takes six to nine months to obtain such a rating.
Still, the RoyalFidelity chief pointed to the estimated $140m that the Government is seeking to raise for the upgrading of 28 Family Island airports as another deal that will likely come to market in 2020, although it will likely be split into smaller tranches and spread over a two to three-year period.
Tribune Business previously reported that a similar structure is being employed with the $100m bridge financing facility for Nassau Cruise Port’s redevelopment, a financing also referred to by Mr Anderson, with that some also broken down into smaller parcels - some of which will be placed in 2020.
He added that several construction projects will also be spurred “on the back of” the Prince George Wharf redevelopment by Global Ports Holding, while other capital raises - including so-called “green bonds” and those for power plant opportunities in the Family Islands - will also likely come to market.
“I think they’ll be looking at issuing green bonds for those renewable energy opportunities out there,” Mr Anderson said.”I think there will be a variety of investment opportunities out there. These are reasonable size deal. These are not small companies, so it’s a good opportunity to get money working.
“In terms of the number of transactions and the size, the amount of money sought will be much larger than is normally the case. To fund them we will have to get people mobilised to move money out of the banks, so I hope we can get that recipe right. That’s where the trick is; to make the capital available at the the right time.”
He added that the markets will “get a better sense of the timing” of upcoming capital raisings early in the New Year, which will be key in laying out a road map for when institutional investors and high net worth individuals need to convert certificates of deposit (CDs) in the bank into liquid, investment-ready cash.
“I think there’s a huge gap been created in the market by the hurricane as a lot of money is needed for repairs,” Mr Anderson said. “The Government is looking to raise capital for private-public partnership (PPP) transactions.
“It will be a year of change, forced change, for both issuers and investors. People have to come and raise money this way. They will be forced into situations they may not have considered worthwhile or necessary, but if they can’t access capital traditionally they will have to look at alternative mechanisms.
“And if investors can’t find decent returns in the bank they will have to look elsewhere. People have been rolling over CDs for two to three years, and have been told they’re getting half the interest rate they received previously. That forces the money to go elsewhere, and hopefully it will go to people looking for it.”
Mr Anderson added, though, said Bahamian capital market raises typically “have a habit of sliding, so it’s hard to organise them”. He urged potential securities issuers to ensure their paperwork and other essentials are “ready ahead of time”, and said: “It’s more a six-month process.
“It could be longer depending on what people are trying to do. People looking for cash need to get themselves organised earlier than they think.”
The latest Central Bank data shows there are some $1.817bn in surplus liquid assets in the Bahamian commercial banking system, a figure that grew by over $285m for the 11 months to end-November 2019.
The traditional year-end draw down is likely to have been offset by reinsurance inflows and government foreign currency borrowings associated with Hurricane Dorian, which means there should be plenty of capital and investors available and seeking higher returns beyond what is available in the banks.
<< Back to news headlines >>
Dollar eases, on track for smallest return in 6 years as risk appetite revives Tuesday 31st December, 2019 – Reuters
The dollar dipped to a near three-week low against the yen in thin year- end volume on Tuesday as investors favored riskier assets, led by renewed optimism about global growth.
The greenback was off 0.2% at 108.64 against the Japanese yen JPY=, the weakest since Dec. 12 and on track for its third straight session of losses.
The dollar indexes. DXY, which measures the currency against a basket of rivals, was a shade weaker at 96.695.
On Friday, the index had suffered its biggest one-day fall since March, which left its gains for the year at about 0.5%, compared with returns of 4.4% in 2018. It is now on track for the smallest rise since 2013.
Encouraging news on the Sino-U.S. trade deal boosted risk sentiment in currency markets overnight.
The White House’s trade adviser, Peter Navarro, on Monday said the U.S.- China Phase 1 trade deal would likely be signed in the next week, but said confirmation would come from President Donald Trump or the U.S. Trade Representative.
Increased optimism about U.S.-China trade relations and an improved global growth outlook drove investors out of other safe-haven assets like Treasury bonds while the risk-sensitive Australian and New Zealand dollars jumped to five-month highs. [US/]
China's yuan CNH= strengthened in the offshore market against the dollar to 6.9718, its highest since Dec. 13. It was last at 6.9743.
The yuan was still on track for a second year of losses, however, as the Sino-U.S. trade dispute and domestic economic weakness took a toll. The onshore yuan was down around 1.5% for the year, after losing 5.3% in 2018.[CNY/]
Investors' appetite for risk also helped drive the euro EUR= to a 4-1/2- month high of $1.121 on Monday. It was last up 0.1% at $1.1209. Signs that the euro zone economy may be stabilizing have lifted the single currency in recent weeks.
Sterling GBP= was last treading water at $1.3115 against the dollar after rising 2.8% so far this year. Concerns that Britain is headed for a disruptive "hard Brexit" at the end of 2020 have hurt the pound since mid-December.
<< Back to news headlines >>
Ford says reservations full for high-end version of electric Mustang Mach-E Tuesday 31st December, 2019 – Reuters
Ford Motor Co (F.N) said on Monday reservations were full for the high- end Mustang Mach-E First Edition electric sport utility vehicle.
The No. 2 U.S. automaker unveiled the electric Mustang crossover on Nov. 17, and began taking reservations with a refundable deposit of $500.
There are four other versions of the Mach-E in addition to the First Edition.
Ford did not provide details on how many reservations it took for the First Edition, which sells for about $60,000, but has said global production in the first 12 months for all versions of the Mach-E is limited to 50,000 vehicles.
The Mach-E has become a high-profile test for a restructuring at Ford that has been marred by profit warnings, costly quality problems and the troubled launch this year of another important vehicle, the Ford Explorer sport utility.
The Mach-E was unveiled in Los Angeles in November. It will be built in Mexico, the first of more than a dozen all-electric vehicles Ford plans to launch by 2022 with an investment of $11.5 billion. The Mach-E’s design was inspired by the classic 1960s Mustang sports car and is meant to challenge electric carmaker Tesla Inc (TSLA.O).
More than 80% of U.S. customers are reserving Mach-E with an extended range battery, while about 55% opted for an all-wheel drive, Ford said. (ford.to/2u0BMOJ)
More than 25% of the reservations are from California, with nearly 30% of U.S. customers choosing Mach-E GT, the company said.
<< Back to news headlines >>
Uber, Postmates sue to block California gig worker law, claiming it's unconstitutional Tuesday 31st December, 2019 – Reuters
Ride-hailing company Uber Technologies Inc and courier services provider Postmates Inc asked a U.S. court to block a California labor law set to go into effect on Wednesday, arguing the bill violates the U.S. Constitution.
In a lawsuit filed in Los Angeles federal court on Monday, the companies and two app-based drivers said the law, which would make it harder for gig economy companies to qualify their workers as independent contractors rather than employees, was irrational, vague and incoherent.
The office of California Attorney General Xavier Becerra said in a statement on Monday it was reviewing the complaint. The bill, called AB5, faces multiple legal challenges.
The law was signed by California Governor Gavin Newsom in September and has garnered national attention, largely owing to the size of California’s workforce and the state’s leadership role in establishing policies that are frequently adopted by other states.
Backers of the bill, including labor groups, have argued the law protects workers’ rights. By classifying the contractors as employees, the companies would be subject to labor laws that require higher pay and other benefits such as medical insurance.
The bill strikes at the heart of the “gig economy” business model of technology platforms like Uber, Postmates, Lyft Inc, DoorDash and others who rely heavily on the state’s 450,000 contract workers, not full-time employees, to drive passengers or deliver food via app-based services.
Uber, Postmates and other app-based companies said the legislation compromises the flexibility prized by their workforce, and that fewer workers would be hired were they considered employees.
The companies in their Monday lawsuit called AB5 a “thinly veiled attempt” to target and harm gig economy businesses. Singling out app- based workers violates equal protection guaranteed under the constitutions of the United States and California, the companies argued.
“It irreparably harms network companies and app-based independent service providers by denying their constitutional rights to be treated the same as others to whom they are similarly situated,” the lawsuit said.
The companies pointed to allegedly arbitrary exemptions of different non- gig worker groups, including salespeople, travel agents, construction truck drivers and commercial fishermen.
The full impact of the bill remains unclear in the short term, but the lawsuit cited a study saying the bill would increase ride-hailing company Lyft’s operating costs by 20% and lead to some 300,000 fewer drivers in California.
Ron Herrera, secretary-treasurer of Teamsters Local 396 and Teamsters International vice president, said in a statement late on Monday night, that the labour union objects the lawsuit challenging the constitutionality of AB-5.
“Teamsters Local 396 and the broader American Labor Movement must use all of the resources at our disposal to ensure that AB-5 is protected and that workers have a voice at the table,” Herrera added.
Uber, Lyft and food delivery company DoorDash have earmarked $90 million for a planned November 2020 ballot initiative that would exempt them from the law.
<< Back to news headlines >>
Lockheed Martin hits 2019 F-35 delivery target of 131 jets Tuesday 31st December, 2019 – Reuters
Lockheed Martin Corp (LMT.N) said on Monday it has reached its 2019 target to deliver 131 F-35 fighter jets to the United States and its allies, as the defense contractor built 47% more jets this year.
The world’s largest defense contractor delivered a total of 134 of the stealthy jets this year and aims to deliver 141 F-35s in 2020.
The most common variation of the jet, the F-35A, now costs $77.9 million, beating its goal of lowering the price to below $80 million a year earlier than expected.
The F-35 program, which makes up about 25% of Lockheed’s annual revenue, has long aimed at expanding the fleet to more than 3,000 jets and bringing the unit price of the F-35A below $80 million through efficiencies gained by bulk orders.
Earlier this year, Pentagon announced pricing details for its agreement with Lockheed that lowers the cost of the F-35 jets it plans to purchase through 2022 by 12.7%, which may encourage other nations to buy the warplane.
In 2019, international deliveries jumped 43% to 30 jets for international partner nations.
More U.S. allies have been eyeing a purchase of the stealthy jet including Finland, Switzerland and the United Arab Emirates.
The F-35 comes in three configurations: the A-model for the U.S. Air Force and U.S. allies, a F-35 B-model which can handle short takeoffs and vertical landings and carrier-variant F-35C jets for the U.S. Navy.
<< Back to news headlines >>
Oil prices set for biggest yearly rise since 2016 Tuesday 31st December, 2019 – Reuters
Oil rose on the last trading day of the decade on Tuesday and was on track for monthly and annual gains, supported by a thaw in the prolonged U.S.-China trade row and Middle East unrest.
Brent crude was up 11 cents at $66.78 a barrel by 1143 GMT. U.S. West Texas Intermediate (WTI) crude rose 6 cents at $61.74 per barrel.
The volume of trade remained low as many market participants were away for year-end holidays.
Brent has gained about 24% in 2019 and WTI has risen 35%. Both benchmarks are set for their biggest yearly gains in three years, backed by a breakthrough in U.S.-China trade talks and output cuts pledged by the Organization of the Petroleum Exporting Countries and its allies.
Signs of progress in the talks between Washington and Beijing and likelihood of signing a trade deal as early as next week boosted factories’ output and Chinese manufacturing activity expanded for a second straight month.
China’s Purchasing Managers’ Index (PMI), an index showing economic trends in the manufacturing and service sectors, was unchanged at 50.2 in December from November, but still remained above the 50-point mark that separates growth from contraction.
Also supporting the prices were rising tensions in the Middle East as thousands of protesters and militia fighters gathered outside the U.S. embassy in Baghdad to condemn U.S. air strikes against Iraqi militias.
Security guards inside the U.S. embassy fired stun grenades at protesters and the U.S. ambassador and other staff were evacuated due to security concerns. The U.S. strikes could pull Iraq further into the heart of a proxy conflict between the United States and Iran.
“Considering that Iraq is the second largest OPEC producer with production around 4.6 mbpd, market participants may add a risk premium to oil tension if tensions last for longer,” UBS oil analyst Giovanni Staunovo said.
“That said, we need to see if the latest protests spread also in the south of the country, where most of the crude is exported.”
Looking ahead, U.S. crude inventories are expected to fall by about 3.2 million barrels in the week to Dec. 27, potentially its third consecutive weekly decline, a preliminary Reuters poll showed on Monday.
Oil prices are likely to hover around $63 a barrel next year, a Reuters poll showed on Tuesday, benefiting from deeper production cuts by OPEC and its allies, and hopes that a U.S.-China trade deal could jumpstart economic growth.
“Oil prices, though largely expected to trade positive, will face headwinds from subdued global growth momentum and robust U.S. shale output levels in the first quarter (of 2020),” said Benjamin Lu, analyst at Phillip Futures.
<< Back to news headlines >>
More efficient NIS in 2020 Tuesday 24th December, 2019 – Barbados Today
Despite a reduction in staff numbers, the National Insurance Department processed significantly more claims in 2019 than it did last year.
And come 2020, it will be using technology more to improve its efficiency, Acting Director Jennifer Hunte has said.
Speaking at the National Insurance Scheme (NIS) staff Christmas party at George Washington House last Saturday evening, Hunte reported that between January and the end of October, the Department received 62,364 Benefit Claims compared with 52,287 for the same period in 2018.
She said it was a challenging year, with increased claims and reduced staff levels.
“In 2019, we averaged 6,236 claims per month compared with 5,228 per month in 2018. The staff, however, redoubled their efforts, cooperated with management’s strategies, and succeeded in achieving even higher levels of production as the service to the public remained paramount,” she said.
“Thanks to your diligence the claims carried forward at October 31, 2019 totalled 9,149 compared with 26,733 as at October 31, 2018.”
The Acting Director promised that as 2020 beckons, the Department would be focused on increasing contributions and compliance to ensure sustainability of the National Insurance Fund, while embracing technology in Government’s digital thrust to assist the NIS in achieving higher levels of efficiency in customer service delivery.
“To the staff, I wish to again express sincere appreciation for your contribution and service to the public. To the public, we wish to assure you that the members of the staff of the National Insurance Department are committed to serving you and are doing everything humanly possible to have your claims processed in the shortest possible timeframe,” Hunte said.
<< Back to news headlines >>
$150m boost for BERT Monday 23rd December, 2019 – Nation News
Government’s economic reform programme has received another $150 million injection from the Caribbean Development Bank (CDB), and under concessional terms previously inaccessible to the country.
The new policy-based loan will help Government finance the purchase of 30 new electric buses, buy more garbage trucks and help settle debt due to external creditors, Minister in the Ministry of Economic Affairs and Investment Marsha Caddle said.
It comes more than a year after the Barbados-based financial institution provided the Mia Mottley administration with funding of the same amount and is the second in a series of such interventions over four years.
Yesterday, Prime Minister Mia Mottley, who signed the loan agreement on Government’s behalf, said being able to access such a loan with a low interest rate was a major boost for Barbados, and also a sign of progress with the Barbados Economic Recovery and Transformation (BERT) programme.
<< Back to news headlines >>
Changes to income tax band Friday 27th December, 2019 – Nation News
Changes to personal income tax (PIT) which were announced in the 2019 Budgetary Proposal and Financial Statement will come into effect from January 1, 2020.
The second tax band on taxable income over $50 000 which was previously at a rate of 33.5 per cent will now be taxed at 28.5 per cent.
The first tax band on taxable income up to and including $50 000 will continue to be taxed at a rate of 12.5 per cent.
Employers are required to adjust their payroll to ensure that the correct rates are used for deducting income tax from wages and salaries.
The Policy Note giving further guidance to this change can be found on the Authority’s website www.bra.gov.bb or at https://www.bra.gov.bb/News/Policy-Notes/Personal-Income-Tax- PIT.aspx.
<< Back to news headlines >>
Digicel bonds down by one-third since January Friday 27th December, 2019 – Jamaica Gleaner
Investors can buy telecommunications company Digicel bonds at roughly 30 per cent cheaper than in January this year as downgrades put pressure on prices.
The discounted prices have created yields above 30 per cent. But the relatively high yield comes with concerns, according to Fitch, an American credit rating agency which downgraded the telecom’s two weeks ago. The agency referenced weak liquidity, unsustainable capital structure, imminent refinancing risk and stagnant operational performance as reasons for the downgrade.
“Fitch expects that Digicel will have to restructure debt at multiple levels in the next 12 to 18 months, due to the group’s unsustainable capital structure and imminent refinancing risk,” added Fitch in a notice dated November 20.
The bonds lost roughly 10 per cent in price following the downgrade but are now mid-way recovered.
When contacted, Digicel declined to comment on the matter.
Digicel has a series of bonds on the market, but Fitch remains “immediately concerned” with Digicel’s US$1.3 billion notes maturing in April 2021.
“Fitch believes that the company will struggle to refinance amid stagnant operating performance,” stated the rating agency.
That bond started the year at US$92 then dipped to a low of US$63 in September, then to a secondary low of US$70 on November 25, before slightly rising to current levels of US$77.50. The yield is about 27 per cent. The Financial Gleaner referenced the prices on separate trading platforms which hold similar data sets, including BondEvalue from Singapore and Market Insider from New York. Another bond, Digicel Limited’s 6.75 per cent maturing in 2023 started the year at US$82 then dipped to US$48 on November 25 on the heels of the Fitch downgrade, before rising to current levels of US$58. The bond lost one-third of its price value since January. It currently holds a yield of some 27 per cent.
Fitch charged that Digicel has weak liquidity, due to its persistently negative free cash flow, high cash interest burden and the limited financial flexibility. Cash on hand at Digicel Group Limited stood at US$214 million, higher than its short-term debt needs at US177 million, reasoned Fitch.
Fitch downgraded all entities in the Digicel corporate structure, with most moving from CC to CCC. An exception included Digicel International Finance Limited (DIFL), which dipped from a B to a B-minus. Fitch added that the outlook on DIFL has been revised to “negative from stable”. High debt-to-EBITDA ratio
Part of the concern relates to the debt level when compared to Digicel’s earnings from operations, or EBITDA. The plan was for Digicel to reduce this from 6.6 times EBITDA by one percentage point in the short term. Fitch, however, indicates that it increased to 7.5 times EBITDA at June 2019 rather than declined.
“The distressed debt exchange that Digicel Group Limited concluded in January 2019 involved an extension of maturities rather than principal haircuts or debt/equity swaps. Fitch expects increasing interest expense to consume most of the company’s declining operating income, which contributes to a cycle of cash burn,” it added.
In January, Digicel extended the timeline for the payout of bonds due by 2020 and 2022 to 2022 and 2024. Mid-year, local investment firm JMMB Group advised clients to consider selling their bonds as they were trading well below par. The firm stated that the low trading prices indicated that investors were not completely sold on Digicel’s future, even after a successful debt exchange which bought the company an extra two years on almost $3 billion in debt.
Also in the year, another rating agency, Moody’s, assigned a limited default status to the bonds following the extension, although it revised the rating to Caa1, up from Caa3.
<< Back to news headlines >>
The LAB grew cash fourfold in the year Friday 27th December, 2019 – Jamaica Gleaner
Limners and Bards Limited, which trades as The LAB, beat market expectations which pushed the stock higher, but the company itself amassed a pile of cash which grew fourfold in the year.
The market pushed the stock 6.5 per cent higher in the week since the release of its results. It now trades firmly above the psychological $3 barrier. It closed at $3.08 last week Thursday.
The company attributed its growth to maintaining its core services while growing new business. The company operates an advertising agency, with its shares listed on the junior arm of the Jamaica Stock Exchange (JSE) earlier this year. It earned $107 million in pretax profit for the year, up from $76 million a year earlier. That equated to 12 cents per share, up from 8.0 cents a year earlier.
The LAB creates advertising campaigns for large companies, including Digicel, GraceKennedy, National Commercial Bank, Jamaica Public Service, Wendy’s, Domino’s and others.
The company offers three main business streams covering agency, media and production services. Its agency division creates brand strategy, copyrighting, and concept development.
The company’s profit showed improvement by double-digit amounts year-on-year, but its cash flow grew by 370 per cent to $291.5 million from $62 million a year earlier. Specifically, its cash flow from operations are up by one-third to $121 million, while the cash it used for investing purposes decreased by three-quarters to $20 million. These improvements arose even before factoring in the $179 million net raise in its initial public offering (IPO) from issued shares.
The company, in its prospectus, had indicated that the funds raised from the IPO would allow it to buy more equipment, finance organic and inorganic growth, and also raise its profile to garner more local and regional clients. Its plans also include the build-out of a public relations department and a digital department. The company wants to earn 25 per cent of its revenue outside Jamaica in three years. In July, the company disclosed that it already identified a target for acquisition as a means of fulfilling its growth strategy.
The LAB, which is principally owned by CEO Kimala Bennett at 77 per cent, is valued at $2.9 billion by market capitalisation. The LAB’s total assets minus liabilities stand at $356 million, representing about 8.0 per cent of the market cap.
Over five years, the company achieved higher revenue and profit in each year except 2017. For its full year ending October 2019, The LAB made $632 million in revenue compared to $483 million a year earlier.
The LAB had its beginnings in 2009 as The Production Lab and was renamed The Limners and Bards Limited in 2014. Prior to its incorporation, The Production Lab was registered as a partnership in 2007 between Bennett and Melissa Llewelyn.
<< Back to news headlines >>
Chukka raising more than US$50m for Caribbean expansion Sunday 29th December, 2019 – Jamaica Gleaner
Chukka Caribbean Adventures is in the market for more than US$50 million of debt and equity to finance a range of projects that are intended to double the size of the business over the next six months to a year. The Jamaican business that now operates 85 tour packages at 15 locations here and in Belize and the Turks and Caicos Islands, is spreading its wings to The Cayman Islands, the Dominican Republic (DR), and Barbados as the first step in a larger vison to grow the business to between 10 and 15 countries in a five to seven years’ timeframe.
The new DR operation was scheduled to be up and running on December 15 with deals in the making in both Cayman and Barbados. The DR activities will take the form of lush tropical forest canopy tours, ziplines and dune buggies, while Cayman, where a deal is being wrapped up to acquire a going concern, is expected to involve mainly catamaran boat rides.
Chukka officials have declined to disclose details of the Barbados deal, citing sensitivities surrounding the arrangements. However, the Barbados Nation newspaper reported in July that Chukka had been selected from a public tender to which six companies responded, to operate the government-owned Harrison’s Caves attraction. Tourism Minister Kerrie Symmonds told the Barbados parliament at the time that negotiations were underway for the government to enter a lease arrangement for what he described as Barbados’ “most fundamental natural asset.”
The deal, the government official said was expected to involve the private operator injecting millions of dollars for upgrading the property, taking into consideration sensitive environmental considerations, employment for persons living near the attraction and part ownership by credit unions and other small businesses. At least one opposition party has called for more details surrounding the deal, under which, sources say, the lessee will take possession of the property located in the parish of St. Thomas on March 1, 2020.
Director of Treasury at Chukka, Alexander Melville told the Financial Gleaner in an interview earlier this month that the company would be banking on its strong relationship with cruise lines that call at many ports across the Caribbean to help drive tourist traffic to the new locations as they have done for Chukka’s existing facilities, including the new zipline at Dunn’s River falls in St. Ann Jamaica.
Good marketing machinery
“We can leverage that relationship to get them even more business. Our other strength is that we have a pretty good marketing machinery, so being able to get people out of the hotels has been strong point for us,” Melville says, noting that the business has grown every year for the past 20 years.
He says the newest round of expansion is expected to almost double revenues, thereby creating greater profit gains for investors.
Chukka is majority-owned by the Melvilles through their holding company Diverz Assets Inc. Property conglomerate PanJam Investment owns 18 per cent of Chukka while the Michael Lee Chin-led Portland Private Equity invested US$5 million for a 10 per cent stake of the business earlier this year. In the current round of fundraising Chukka is raising some debt and offering equity through preference shares.
Melville notes that Chukka has been able to manage its current stock of debt, which was not disclosed.
He adds that debt servicing was reduced with the combination of debt facilities into a $2 billion or US$16 million dual currency bond that was issued late 2017 to early 2018 and executed by private capital investment company Sygnus Capital.
That bond issue effectively lowered Chukka’s debt servicing cost from 10 and 11 per cent, the treasury director disclosed. The bond had an interest rate of 8.5 per cent on the Jamaican dollar portion and US dollar coupon of 6.5 per cent.
“It’s like US$1.5 million a year interest cost on the bond with no principal payments on it. It has been the same for the last two years. We do six, seven million US dollars of EBITDA (earnings before interest, tax, depreciation and amortisation) so US$1.5 million of interest cost is not going to eat into all of your bottom line,” said Melville, in underscoring the financial health of the business.
He adds that plans are underway to list various segments of the business on the Jamaica Stock Exchange beginning in early 2020 with an initial public offering (IPO) planned for subsidiary Tropical Battery Limited, to be followed by other segments of the Chukka business within the next year. Melville said the Tropical Battery IPO, being arranged by NCB Capital Markets, will seek to raise between $350 million to $450 million for about a 25 per cent stake of the company.
He sees the public equities market as a good way of broadening the ownership of the business with participation by staff while growing its footprint, earnings and profitability and maximising value for shareholders.
<< Back to news headlines >>
SECOND EXTENSION FOR MPC CARIBBEAN RIGHTS ISSUE Sunday 29th December, 2019 – Jamaica Observer
A less than anticipated take up of MPC Caribbean Clean Energy US$22.8 million rights issue has resulted in a second extension of the offer.
As brought to the understanding of the Jamaica Observer, the rights issue, which was extended by one week initially on December 16, is now slated to close on January 10, 2020.
MPC Caribbean board of directors last week approved the extension of the offer to facilitate additional applications, as the take up by shareholders has been slow and less than anticipated.
The rights issue opened on November 13 and was initially slated to close on December 16 but was extended by one week to close on December 23. The offer will allow existing shareholders to buy two new shares for each original share held. MPC plans to issue 22.84 million new shares in the rights issue at US$1 or the equivalent of J$140 in Jamaica and Trinidad.
MPC is the company behind Jamaica's new Eight Rivers Paradise Park solar energy project in Westmoreland, which was commissioned into service earlier this year. Paradise Park began producing energy in June and is the cheapest source of energy provided to the national grid at a cost of 8.5 US cents per kilowatt hour.
MPC raised $US 11 million in its initial public offering (IPO) on the Jamaica and Trinidad and Tobago stock exchanges in January this year.
Eligible shareholders in the rights issue may subscribe for new shares at a rate of two fully paid ordinary Class B shares in the company for every one fully paid ordinary Class B share in the company held as at the record date of November 8, 2019.
PROCEEDS FROM RIGHTS ISSUE
MPC intends to use the net proceeds to invest in an affiliated investment company, MPC Caribbean Clean Energy Fund LLC, which will use these funds for the purpose of investing in clean energy projects and facilities with a particular focus in the Caribbean Basin.
The primary sector focus will be solar projects and wind farm operations. MPC argued that the Caribbean Community member states are expected to add over 5.3 gigawatts of renewable energy capacity in the next eight years and wants to win some of these contracts going forward.
MPC Caribbean Clean Energy Fund LLC, will pool the additional equity along with other separate investments to eventually capitalise the fund to US$200 million.
The investment company is backed by MPC Capital, an international asset and investment manager headquartered in Germany, which already provided a US$5- million cornerstone commitment to the investment company.
“The target size for the investment company is US$200 million, targeted to be raised within 12 months of the first closing date of the investment company and deployed within the four-year investment period,” said the company.
ENERGY PROJECTS PIPELINE
A further 14 projects have been prioritised and form the indicative deal pipeline for the investment company. These projects require a total investment of circa US$498 million and are expected to deliver up to 320 megawatts of new renewable energy capacity.
The first seed asset was Paradise Park 50 MW solar plant in Jamaica with a total investment of approximately US$64 million. Paradise Park reached financial close in June 2018 and was energised on June 6th, 2019.
The second seed asset is Tilawind, a 21 MW onshore wind farm based in Costa Rica with a total value inclusive of debt at US$50 million. Tilawind has been in operation since March 2015.
MPC Caribbean Clean Energy Fund LLC and regional group, Ansa McAL Limited have acquired the asset through a 50/50 joint venture.
<< Back to news headlines >>
US$452-million Kingston port modernisation project nearing completion Friday 27th December, 2019 – Jamaica Observer
The US$452-million port modernisation project is moving towards completion in Kingston, and it is already remaking Jamaica's major port.
The Inter-American Development Bank (IDB), based in Washington DC, is providing two loans, amounting to US $215 million, while China Infrastructure Fund has given a loan commitment of US$50 million to Kingston Freeport Terminal Limited (KFTL) for the project to modernise the port of Kingston.
KFTL operates Kingston Container Terminal (KCT) under a 30-year lease concession to finance, expand, operate and maintain the port, which is one of the largest container and trans-shipment ports in the Caribbean.
The project is being executed in three phases of which Phase 1 is completed while Phase 2, which is almost complete, has already transformed the port of Kingston through a number of land and offshore developments. Phase 3 is about to begin.
PHASES 1 AND 2
Phase 1 consists of deepening the channel, turning circle and quays to allow access by 14.2 m draft vessels; and within six years, capacity optimisation from 2.8 million 20-foot equivalent units (TEU) to 3.2 million TEU, while Phase 2 is increasing the draft to allow access by 15.5 m draft vessels.
TEU is an inexact unit of cargo capacity often used to describe the capacity of container ships and container terminals. Phase 3 will see the construction of a new berth in order to increase KCT's capacity to 4.5 million TEU.
The objective of the initial programme (Phases 1 and 2) is to increase the capacity of the port such that it will be able to accommodate the largest vessels transiting the expanded Panama Canal.
This goal has been achieved by construction work, which increases the capacity of the quays at the berths to allow larger vessels; by dredging the shipping channel for greater draft; and increasing the stacking yard capacity through new equipment and operational changes.
The project includes equipment and infrastructure upgrades, specifically the south existing quays — the ship turning circle, plus the dredging for new vessel draft requirements.
REFURBISHING QUAYS
The quays have been refurbished and strengthened. Out of the total 2400 m length, a subset of 1200 m of the quays will be capable of accommodating the New Panamax vessels. The terminal container yard will, at the end of the process, have a capacity of 102 hectares.
To increase terminal efficiency and capacity to 3.2 million TEU per year, the equipment upgrades include the purchase of four new cranes to make a total of 18 quay cranes and 64 straddle carriers. Additional quay refurbishment and strengthening have been completed.
Several existing cranes have been decommissioned and newer cranes commissioned into service. In Phase 2 the dredging works will deepen the realigned inner channel from the Phase 1 depth of 15.60 m to 17.0 m, to allow 12,600 TEU vessels with a draft of 15.5 m clearance for safe sailing conditions all the way to the swing basin.
The dredging sediment quantity involved is in the range of 5.0 million m3. The dredging quantity involved is approximately 2.2 million m3. From the end of the ship's channel into the eastern channel, the seaward areas of the outer harbour and the east channel will be more exposed to swell to deeper draft vessels (15.5 m in Phase 2 versus 14.2 m in Phase 1).
The total amount of sediment to be removed from east channel is estimated at 250,000 m3. As with Phase 1, there will be some specific outcrops that will need to be removed to achieve the desired depth, but these will not include previously anticipated removal of parts of Rackhams and Gun Cay.
Narrowing of the area adjacent to the harbour side of the causeway inlet/outlet could result in increased current velocities, eddy currents, sediment transport, freshwater plumes and changes to the hydrodynamics of the harbour.
However, due to the potential impact on flows in and out of Hunts Bay this activity has been removed from the project and may be considered for Phase 3, but only after additional evaluation of design options to mitigate these impacts.
<< Back to news headlines >>
Sagicor Manufacturing and Distribution Select Fund lists on JSE Friday 27th December, 2019 – Jamaica Observer
Sagicor Manufacturing and Distribution Select Fund listed on the main market of the Jamaica Stock Exchange (JSE) on Wednesday, December 18, 2019, after successfully raising over $2.7 billion from over 5,000 applications.
Lead broker and lead arranger for the initial public offering (IPO), Sagicor Investments shared that all applicants were allotted the full complement of shares requested.
The IPO opened on November 20, 2019 seeking to raise $2.5 billion, with a right to upsize by an additional $1.5 billion. Shares for purchase were available in the Class C ordinary shares and were offered at a per share price of $1, for a minimum of 1,000 shares.
Reynaldo Thompson, manager —research, portfolio and fund management, Sagicor Select Funds Limited, expressed gratitude to investors at the listing ceremony on Wednesday morning.
“We are very happy that the market accepted what we came with, which was to present equities to the average investor,” he said.
“This is an exciting time for us at the Jamaica Stock Exchange,” Marlene Street Forrest, managing director, JSE, added following the strip insertion of the Sagicor Manufacturing and Distribution Select Fund. “We have seen that plans discussed have come to fruition. This is one more listing, and a significant listing because it provides investors an opportunity to buy a basket of securities that are listed on the market —our very own exchange traded fund— so this is a very important move for us.”
The fund will own stocks in the most successful manufacturing and distribution companies on the main and junior markets of the JSE. It will also track the manufacturing and distribution index on the main market.
The IPO for the Sagicor Manufacturing and Distribution Select Fund closed on December 4. It is the second listed equity fund on the stock market following the Sagicor Financial Select Fund, which was listed in August.
Sagicor Group Jamaica is a financial services conglomerate which commenced operations in 1970 as life of Jamaica Limited, the first locally owned life insurance company and the first life insurance company to be listed on the JSE.
The group offers products and services in the areas of banking, insurance, investments, real estate, asset management and retirement planning.
Sagicor Life Jamaica Limited is the leading life and health insurance provider in Jamaica while Sagicor Bank is one of Jamaica's largest banks. Sagicor Investments is one of the top investment companies in the country.
Sagicor Group Jamaica is a member of the wider Sagicor Financial Corporation, which operates in over 20 countries. Its operations date back to 1840.
<< Back to news headlines >>
Jamaica records best tourism numbers — Bartlett Monday 30th December, 2019 – Jamaica Observer
Tourism Minister Edmund Bartlett has reported that the high stopover visitor arrivals and earnings for December are unprecedented in the island's tourism history.
“This December is going to be the biggest December in the history of Jamaica for stopover arrivals and earnings,” the tourism minister announced.
Speaking to reporters in Montego Bay last week, Bartlett noted that up to December 21, the statistics showed that stopover arrivals grew by nearly nine per cent but projected that the current momentum should push up the figures further by the end of the month.
He added that initially there was scepticism that the growth in stopover arrivals this December could eclipse last year's figure.
“We initially thought this December would be a little soft because December traditionally is a big month and last December was a huge month, but we are now growing at 8.8 per cent so far and that is to the 21st [of December] and the big week of Christmas is now happening and then another big week for the new years,” Bartlett stated.
He pointed out that the growth in stopover arrivals will inevitably push the earnings for the year over the US$3.7 billion projection.
“We can see that December is going to give us some double digit out- turn. Chances are 10, 11 per cent, which would be really, really strong and would ensure that the projections of this being a mega December, and in ending the year are pretty close to 2.6 million stopover arrivals and the earnings that we had projected of US$3.7 billion may very well become US$3.8 billion,” the tourism minister stated.
Bartlett noted that Jamaica, which is recording the fastest growing stopover arrivals in the Caribbean, has almost doubled tourism earnings since the Andrew Holness-led Jamaica Labour Party formed the Administration in 2016.
“What we are saying then is because of how this year has developed momentum in terms of stopover... and stopover is where the earnings are... and that's why we are growing faster in earnings than any destination in the Caribbean. We are up 10.3 per cent in earnings and the fact is in the three-and-a-half years that we have been in Government we have almost doubled the earnings in tourism because when I took over as minister we were earning US $2 billion. We are now at US$3.7 billion going to be US$3.8 billion. We are expecting that next year of course we will do US$4 billion,” Bartlett stated.
<< Back to news headlines >>
New 194 MW natural gas power plant up and running Wednesday 25th December, 2019 – Jamaica Observer
THE new 194 megawatt (MW) natural gas power plant in Old Harbour, St Catherine is now operational, Jamaica Public Service Company (JPS) announced Monday night.
According to JPS, the plant — which is operated by South Jamaica Power Company (SJPC), a JPS affiliate — was declared operational shortly after midnight on Tuesday, December 17 and since then has been operating continually, providing clean, efficient power to the national grid.
The light and power company explained that after SJPC broke ground for the new plant in March 2017, the facility was renamed The South Jamaica Power Centre upon completion.
“South Jamaica Power Centre is now the most efficient, fuel-burning power producer in the country,” JPS said. “The plant will generate electricity using natural gas in a more efficient manner than any other plant in the country. The new plant will play a critical role in improving power supply reliability. This plant will provide cleaner energy than the older plants that it will replace.”
Built at a cost of US$330 million, the project employed more than 470 Jamaicans during the peak of construction.
“While we encountered challenges associated with a project of this magnitude, we are happy to declare the plant ready to serve JPS' customers,” the release quotes SJPC management committee chairman and JPS board director Mo Majeed.
“We fully expect the inclusion of natural gas in power generation to result in greater fuel diversification and the stabilisation of electricity costs over the long term, while enhancing energy security for the nation,” Majeed added.
The integration of more renewables on the grid and improved technology will lower generation costs, as well as Jamaica's exposure to the volatility in world oil prices, JPS explained.
“The new plant and natural gas will replace the heavy fuel oil (HFO) now used for much of the country's electricity generation. This shift to natural gas will result in cleaner and more environmentally friendly energy,” the light and power company said.
The combined cycle power plant has the capacity to support 300,000 homes. The new system uses three dual fuel natural-gas-fired/Automotive Diesel Oil gas turbine generators, three supplemental natural gas-fired heat recovery steam generators, one steam turbine generator, a seawater cooled condenser, and related ancillary equipment. The new plant is located next to the old JPS power station, which will be completely decommissioned in 2020. It will replace several of JPS' 50-year- old generating units that run on HFO and that are due for retirement.
The South Jamaica Power Centre is Jamaica's second power plant to operate on natural gas, following the conversion of JPS' Bogue Power Station in Montego Bay from Automotive Diesel Oil.
SJPC is a joint venture with MaruEnergy, JPSCO 1 SRL, EWP (Barbados) 1 SRL and the PetroCaribe Development Fund. The Spanish firm, TSK, was contracted to complete the new plant.
<< Back to news headlines >>
Paypal and Paymaster Sunday 29th December, 2019 – Jamaica Observer
Paypal through their Xoom international money transfer services has said that in collaboration with local bill payment provider, Paymaster, they have launched a fast, secure and easier bill payment option for Jamaicans living in the Diaspora to provide financial support to their loved ones back home.
Julian King, vice-president and general manager of Xoom said that the partnership will allow Jamaicans living abroad another way to provide family and loved ones with financial support.
“Through this new collaboration, Xoom users can now send money to cover everything from electricity to insurance bills without having to wait in line or fill out forms, and recipients can have the peace of mind knowing their bills are paid on time, usually in minutes,” he said.
General Manager of Paymaster, Nicolene Worthy-Donaldson also expressed elation at the partnership.
“For over 20 years we at Paymaster have prided ourselves on satisfying our customers' evolving needs through our nearly 200 locations in Jamaica and our e-commerce platform. We are excited to be partnering with Xoom, PayPal's international money transfer service and a leader in international digital money transfer technology, to offer a one-stop international bill payment service to Jamaica that will help provide persons living outside of Jamaica with a fast, convenient, and secure way to pay bills in Jamaica,” she said.
The service offered by Xoom is regarded as a fast and secure way to send money, pay bills and reload phones for loved ones in over 160 countries globally. Remittances serve as a lifeline for many people around the world and are used to pay for every day needs like utility bills, healthcare, and education costs, as well as emergencies.
Through the services offered Xoom users can pay bills for family and loved ones in just a few simple steps, by going to the website or by downloading the mobile app.
According to Bank of Jamaica statistics provided in a press release this service will be significantly beneficial to the country's economy which is driven by remittance inflow.
“Jamaicans spent a grand total of $227.7 billion in bill payments for utility and other services in 2016. With this new launch, Jamaicans living in the US, U.K., Canada and 37 markets across Europe can now use Xoom to help ease the burden their relatives face when it comes to paying bills back in Jamaica.
“Many of these remittances sent are used to cover costs for everyday needs such as electricity, internet, cable television, mobile and landline phones, water, and more. Now, with this new feature, Xoom and Paymaster are empowering users to directly pay bills for loved ones and giving Jamaicans an easy way to ensure their bills are covered,” the release stated.
<< Back to news headlines >>
Public Works will rescue the city’s pedestrians Monday 30th December, 2019 – Dominican Today
The Minister of Public Works, Ramón Pepín, announced a rescue program for the pedestrian bridges of the National District and the province of Santo Domingo, to restore ease of use to citizens.
During a supervisory tour by the pedestrians of Máximo Gómez Avenue with John F. Kennedy and February 27, the official said that they started with these two structures because they are the most used by citizens.
He indicated that the investment in these two works is about 60 million pesos because they were completely remodelled, but also the arborization, landscaping and lighting were updated so that people are not afraid to use them during the nights.
He informed that within the next year’s budget of the ministry he directs, an important (not specified) resource item was contemplated to rehabilitate all pedestrian bridges and restore people’s confidence to use them.
“We ask users to take care of this great work, great investment has been made in terms of economy and labour. The Ministry of Public Works will continue to work on pedestrian bridges because we all deserve a safer city,” he said.
He said that many pedestrian bridges are used only during the day because at night they have no lighting and people are afraid to go over them to avoid being a victim of crime.
He stressed that young glass cleaners and vendors on the pedestrian bridge of Máximo Gómez Avenue with John F. Kennedy have voluntarily united in the work of cleaning and maintenance of the hygiene of that structure.
He argued that the biggest problem with these structures is that people urinate in the bases and that totally destroys iron.
In addition, the Minister of Public Works, Ramón Pepín, urged citizens to take care of these works not only because of the cost it represents for the State by way of taxpayers but because they are very necessary for the pedestrian traffic of citizens who deserve a safer city.
<< Back to news headlines >>
Consumer confidence in DR is positive Tuesday 24th December, 2019 – Dominican Today
The results of the twenty-fifth Consumer Confidence Survey (ICC-RD) of the Ministry of Economy, Planning, and Development (MEPYD), last October, show a positive variation in the overall consumer confidence index of 1.3 points compared to that observed in May 2019.
The Consumer Confidence Index of the Dominican Republic includes the assessment of the current status and expectations of the personal and country economic situation. It is broken down into complementary indicators on prices, labour market, savings, and consumption, considering the current situation (current situation) and consumption expectations.
In the recent results of the improvement of the global index of confidence of the Dominican consumer, with respect to the previous survey, has contributed the greater confidence in the future situation (7.7 points), which even surpasses the barrier of the 100 points for the first time since May 2015.
There was an increase in global consumer confidence in price stability (9.7 points) and followed, in order of importance, the variation in confidence in consumer capacity (6.8), in opportunities of the labour market (6.6) and, finally, confidence in saving capacity (3.7). By geographical area, the greatest variations were experienced in the tourist area.
<< Back to news headlines >>
RBC blasts union as RBTT workers stay away from work in SVG Saturday 21st December, 2019 – iWitness News
RBC Royal Bank on Friday described as “sudden and unexpected” the industrial action, which it said was commenced by the Commercial Technical and Allied Workers’ Union (CTAWU), which represents its workers in St. Vincent and the Grenadines.
RBC Royal Bank, operating in SVG as “RBTT”, said in a statement that it was “extremely disappointed with this unfortunate industrial action being taken by its employees with the apparent support of the Commercial Technical and Allied Workers’ Union”.
The statement said that formal and informal discussions on “the issues in question” were well underway and talks were progressing cordially.
“This job action, taken on the last Friday before Christmas, serves only to negatively impact our clients seeking to access banking services at this busy time of year. Clients’ anger and frustration is understandable, and we sincerely regret that this action is disrupting their normal routines,” the statement continued.
It further said:
“We have committed, as the Union knows, to letting the formal industrial relations process play out as we work together to resolve any outstanding issues.”
“RBTT clients who are impacted by this industrial action may continue to make use of our digital banking platform, our mobile app, or our ATM network to perform most everyday banking transactions.”
On Friday, RBTT Bank employees in SVG stayed away from the job, with one source telling iWitness News that workers were “standing up for the change of working hours and overtime pay according to the labour laws that were changed since 2008”.
The source said that the bank’s management has not made an effort to deal with this situation and has turned around and entered into an agreement with First National Bank of St. Lucia to sell the bank.
Head of the CTAWU, Joseph “Burns” Bonadie told iWitness News around 9 a.m. that he was “not right now” in a position to comment on the development.
<< Back to news headlines >>
Only $5m of $15m for ganja licences collected — PM Sunday 29th December, 2019 – iWitness News
Only five to six million dollars of the 15 to 16 million dollars that authorities in St. Vincent and the Grenadines have approved for medical marijuana licences have reached the state coffers, says Prime Minister Ralph Gonsalves.
His comments on Tuesday came just over a month after Minister of Finance Camillo Gonsalves told a rally to mark the 25th anniversary of the ruling Unity Labour Party, that the country “has earned already” $15 million in ganja cultivation licence fees.
The finance minister said that he had asked Minister of Agriculture Saboto Caesar, last year, about his projections for the first year of the industry.
The finance said Caesar told him that the industry had just started and he was anticipating about $5 million.
“Already this year, five million, we gone past that; 10 million, we gone past that; 15 million dollars Saboto Caesar has earned already in licence fees from the medical cannabis industry, and we are just getting started,” he told the thousands of persons at the decommissioned ET Joshua Airport in Arnos Vale.
However, speaking on Hot 97 FM on Tuesday, the prime minister said:
“One of the problems is this. Some entities which have received licences, some overseas entities, and the value of the licences issued thus far is about 15-16 million [dollars] but we haven’t collected that. We have collected about 5-6 million. The reason being — you can’t pay the money in US dollars. No bank will touch it because of the federal government regulations and you don’t want Bank of America or Bank of New York not to give you corresponding banking relationship.”
The prime minister said that banks in SVG, like the Bank of St. Vincent and the Grenadines, which have corresponding banking relationships with Bank of America and Bank of New York, are very careful how they process monies coming for medical marijuana licences.
“If they are paid in Canadian dollars through Canadian Dominion and Canadian Dominion accepts money in Canada, I have been advised, from the medical cannabis industry so they don’t mind transmitting the money for you if the cheque issued in US dollars.
“So, some licences have been issued and people are ready to pay the money but they have to go through a particular route, so all those arrangements,” the prime minister said.
He continued: “There are some local people who have arrangements with some from overseas but who can’t operate properly yet because they don’t have in their hands, even though their license is issued, the licence is issued on the condition that you pay this money, but if the money ain’t reach the Medical Cannabis Authority, you don’t have the licence for operational purposes.”
<< Back to news headlines >>
Curacao signs agreement with Klesch to operate Isla refinery Tuesday 24th December, 2019 – Reuters
Curacao’s state-run refining company, Refineria di Korsou (RdK), said it has signed an agreement with industrial commodities conglomerate Klesch Group to operate the island’s 335,000-barrel-per-day Isla refinery and storage facilities.
The asset purchase and sale agreement, signed on Sunday, entails the sale of the Isla complex including its oil storage terminal, with a long lease on the land, according to a statement by RdK.
RdK has been searching reut.rs/35ZLxLu for a replacement to Venezuela's Petroleos de Venezuela (PDVSA) as operator of the refinery and in September entered into exclusive talks with Klesch.
The search began after a dispute last year between the Venezuelan company and U.S. oil producer ConocoPhillips left the plant idled amid attempted asset seizures.
PDVSA’s contract as operator of the refinery expires at the end of the year, but it has agreed to remain until Kresch can take over fully. PDVSA had sought a contract renewal but won only a temporary continuation earlier this month.
The agreement would put Kresch in charge of the Bullenbay oil terminal, with its 17.75 million barrels of storage and blending capacity. Bullenbay is where PDVSA had received imported light oil that it mixed with its own extra heavy crude to create an exportable blend.
RdK said it aims to sign two remaining agreements with the privately held Klesch over the next year. Klesch, which owns and operates the Heide refinery in Germany, has offices in London and Geneva.
<< Back to news headlines >>
China adjusts CFETS index basket, cutting dollar weighting Tuesday 31st December, 2019 – Reuters
China will adjust the weighting of a key yuan index in the new year, the country’s foreign exchange trading platform said on Tuesday.
The move will be the second adjustment since China introduced the trade-weighted yuan exchange-rate index in December 2015, to better reflect the country’s external trade conditions.
Starting on Jan. 1, the China Foreign Exchange Trade System (CFETS) will reduce the U.S. dollar’s weighting in the CFETS currency basket to 21.59% from 22.40% and increase the euro’s weighting to 17.40% from 16.34%.
CFETS, which is overseen by the People’s Bank of China, has been trying to reform the way it manages the yuan by making it more market-driven and transparent.
The platform said the weighting of the CFETS yuan index was calculated using trade-weighted methods. The current version of the index adopted trade data from 2015.
“In order to make the index more representative, the CFETS will use the trade data from 2018 to adjust the currency weighting,” the trading platform said.
The number of the currencies in the CFETS will remain at 24, according to a statement published on the website.
Traders and analysts said the changes were an update and they do not expect them to cause much market volatility.
The onshore yuan CNY=CFXS finished domestic trading at 6.9662 per dollar, set for its second year of losses. The CFETS index .CFSCNYI has fallen more than 2% in 2019.
In late 2016, CFETS expanded the basket by nearly doubling the number of foreign currencies in the basket from 11 while reducing the dollar’s weighting by 4 percentage points.
The trading platform also said it would adjust the weighting of a yuan index based on BIS currency basket by removing Venezuela’s bolivar and adding the Icelandic crown.
<< Back to news headlines >>
China's mutual fund industry had a record year of product launches: Shanghai Sec News Monday 30th December, 2019 – Reuters
China’s mutual fund industry witnessed a record year of product launches in 2019, the official Shanghai Securities News reported on Tuesday.
A total of 1,040 new funds were launched during the year, raising a record 1.41 trillion yuan ($201.82 billion), according to the newspaper.
Nearly 500 new bond funds were established, raising 893.4 billion yuan, or 63.2% of the industry’s total new fundraising, the article said.
This year also saw the launch of 212 new equity funds and 305 balanced funds, which raised 238.8 billion yuan and 267.97 billion yuan, respectively, according to Shanghai Securities News.
Ninety exchange-traded funds (ETFs) were launched, raising 175.4 billion yuan, nearly doubling from the previous year, the newspaper said.
China’s stock market has gained over 20% this year, aided by Beijing’s economic stimulus measures and hopes of a trade deal with the United States.
Equity-focused mutual funds achieved an average return of 44%, far outperforming the benchmark, the article said.
<< Back to news headlines >>
China issues first 2020 fuel export quotas, up 53% from year ago Monday 30th December, 2019 – Reuters
China has raised the volumes of its first batch of 2020 fuel export quotas by 53% from a year earlier to 27.99 million tonnes, according to a document from the Ministry of Commerce that was reviewed by Reuters on Tuesday.
The new quotas will be shared among five state oil companies, PetroChina, Sinopec, China National Offshore Oil Corp, Sinochem Corp and China National Aviation Fuel Corp, according to the document.
The quota increases follow the addition of about 900,000 barrels per day of crude refining capacity in China this year that has caused a domestic fuel glut and spurred record exports.
In a departure from past quota announcements, the commerce ministry did not give a breakdown of exports by products, such as gasoline, diesel and jet kerosene, but instead will allow the companies to decide what products to export.
Beijing normally issues three or more batches of quotas during a year. The first batch issued for 2019 was 18.36 million tonnes, about a third of the annual total of 56 million tonnes eventually given. [nL3N1YX1EQ]
Sinopec, Asia’s biggest refiner, was granted the largest quota at 13.36 million tonnes, PetroChina received 9.2 million tonnes, CNOOC was given 2.58 million tonnes, Sinochem 2.79 million tonnes and China National Aviation Fuel 60,000 tonnes.
The first round of 2020 quotas will be split into 24.55 million tonnes under the general trade category and 3.44 million tonnes under tolling arrangements, the document showed.
Companies receive a tax refund for general trade transactions once exports are completed, while taxes are waived under tolling arrangements.
In 2019, 48.15 million tonnes of quotas were given under the general trade category and 7.85 million tonnes under the tolling scheme, mostly for jet kerosene exports.
None of China’s private refiners were given export quotas in this first batch but company sources from Hengli have said the company is seeking to become the country’s first private jet fuel exporter.
China’s State Council, or cabinet, will allow qualified private companies to import crude oil and export oil products to widen market access in industries such as power, petroleum and telecommunications, state news agency Xinhua reported on Dec. 22, without saying when the change will occur.
<< Back to news headlines >>
China outbound M&A plummets to 10-year low on trade tensions, economic slowdown Tuesday 31st December, 2019 – Reuters
China’s outbound mergers and acquisitions (M&As) clocked their weakest year in a decade in 2019, as an escalated U.S.-China trade war and tightened regulatory scrutiny of Chinese companies impacted appetite for overseas deal-making.
Chinese acquirers announced $41 billion in outbound deals this year, nearly halving from 2018 and less than a fifth of the 2016 peak, showed data from Refinitiv. The number was only slightly higher than 2009 when deal-making plunged after the financial crisis.
Outbound deals into the United States dropped 80% this year from last to $2 billion.
The fall came in a year in which the U.S. Committee on Foreign Investment, which reviews deals by foreign acquirers for potential national security risks, started to retrospectively review deals. That led to Chinese firm Kunlun selling gay dating app Grindr due to fears surrounding data security.
“The top concern of Chinese investors is potential geopolitical pushback,” said Yuxin Shen, a Beijing-based M&A partner at law firm Freshfields Bruckhaus Deringer. “Unless there is a compelling reason, we don’t see much Chinese interest in U.S. assets these days.”
At home, Chinese companies - which used to borrow heavily to fund overseas purchases - are under pressure to cut debt as economic growth slows and capital controls remain tight.
Fitch Ratings in December said a record 4.9% of private issuers of onshore bonds had defaulted on payments in the first 11 months of 2019. Capital controls have also made it difficult for mainland firms to pay off offshore debt.
HNA Group Co Ltd [HNAIRC.UL], once China’s deal-making champion, has been shedding assets to pay off debt, while Shandong Ruyi Woolen Garment Group Co Ltd (002193.SZ), which bought a series of overseas fashion brands in recent years, is also struggling to refinance debt piled up from acquisitions.
Overall, deals involving Asia-Pacific firms worldwide fell to $1.06 trillion from $1.4 trillion in 2018.
Bankers expect Chinese state-owned companies to play a major role in deal-making next year, with interest seen in traditional sectors such as mining and infrastructure.
Divestment by multi-national companies and corporate restructuring could also bring more deals within China, bankers said.
“The biggest issue in China is uncertainty which makes investors reluctant to make big commitments and assets hard to price,” said Jonathan Zhu, a managing director at buyout firm Bain Capital. “We will likely see more domestically driven M&A activities in China next year, but fewer cross- border deals.”
<< Back to news headlines >>
Indian PM Modi's office proposes waiving carbon tax on coal Monday 30th December, 2019 – Reuters
Indian Prime Minister Narendra Modi’s office has proposed waiving a tax on coal to help finance pollution-curbing equipment, according to documents, but the move would also make coal more competitive in price with solar and wind energy.
Modi’s office has proposed waiving the carbon tax of 400 rupees ($5.61) per tonne that was levied on the production and import of coal, according to the documents reviewed by Reuters.
The documents say the savings would improve the financial health of utilities and distribution companies and help the power producers to install pollution-curbing equipment.
The prime minister’s office and the power ministry did not respond to requests seeking comment on the proposals and when a decision was likely to be made.
Despite struggling with some of the world’s worst air pollution levels, India has already pushed back a deadline to cut emission levels to up to 2022.
Over half of India’s coal-fired plants are already set to miss a phased deadline starting Dec. 2019 to cut emissions of sulphur oxides, which have been proven to contribute to lung disease.
The proposal is a big win for India’s coal industry, which has lobbied for government help, citing high debt levels and burgeoning payment dues from government-owned power distribution companies. Distribution companies owed power producers more than $11 billion in dues as of October, according to government data.
Hardik Shah, deputy secretary at Modi’s office, advocated waiving the carbon tax on coal in an October note to the top bureaucrat at India’s power ministry, seen by Reuters.
“A possible solution is to waive the goods and services tax (GST) compensation cess…on coal,” Shah said in the note on the installation of equipment to cut emissions of sulphur oxides.
Shah argued for a waiver saying even if India ensured adequate financing to power plant operators to install the equipment, it would lead to higher electricity tariffs that would further burden distribution companies which buy power from utilities.
COAL VS RENEWABLES
The proposal comes at a time when India is set to open up coal mining to global mining companies for the first time. An implementation of the proposal would provide a fillip to state-run Coal India, whose stock has lost a fifth of its value over the last 12 months.
Thermal power companies, in addition to emitting greenhouse gases, account for 80 percent of all industrial emissions of particulate matter, sulphur and nitrous oxides in India.
The average rate at which coal-fired power is sold to distribution companies stands at about 3.50 rupees per unit, according to a Reuters analysis of data provided to the power ministry by many Indian utilities in October.
That compares with an average cost of 2.50 rupees to 3.00 rupees for renewable energy projects. The current carbon tax on coal contributes to 0.25 rupees per unit, according to industry estimates.
If implemented, the move would reduce the price gap between coal- fired power and renewable, and potentially impact Modi’s plan to increase adoption of green energy.
“Cutting taxes on coal would impact growth of renewable energy as well as the transition away from coal,” said Nandikesh Sivalingam, Director at Centre for Research on Energy and Clean Air (CREA).
The prime minister’s office says installation of pollution cutting equipment would cost companies 0.30-0.35 rupees per unit and hence removal of the carbon tax would help companies meet emissions targets while ensuring electricity costs do not rise.
But it will be a one-time cost and going forward, coal-fired utilities would be able to compete better with renewable energy.
The proposal, if implemented, would cost India over 3% of its total indirect tax collection, which has been falling due to a broader economic slowdown.
An abolition of the cess could also subject the federal government to further criticism from state governments, since they received the realized revenue from the government to compensate for shortfalls due to the implementation of a new tax structure in 2017.
Modi’s office says if no waiver is given, some form of government subsidy would have to be given by states to keep the power producers functioning and the carbon tax abolition would make up for some shortfalls.
<< Back to news headlines >>
Caribbean economies lag in terms of reforms – World Bank Tuesday 31st December, 2019 – Jamaica Gleaner
The World Bank says economies in Latin America and the Caribbean continue to lag in terms of reforms as it relates to doing business in the region.
In its flagship publication Doing Business 2020, in which the World Bank Group flagship the regulations that enhance business activity and those that constrain it, the financial institution noted that of the 294 regulatory reforms implemented between May 2018 and May 2019 worldwide, 115 economies made it easier to do business.
“Economies in Sub-Saharan Africa and Latin America and the Caribbean continue to lag in terms of reforms. Only two Sub-Saharan African economies rank in the top 50 on the ease of doing business; no Latin American economies rank in this group,” the World Bank noted.
“Those economies that score well on Doing Business tend to benefit from higher levels of entrepreneurial activity and lower levels of corruption. While economic reasons are the main drivers of reform, the advancement of neighbouring economies provides an additional impetus for regulatory change,” the World Bank said, noting that “26 economies became less business-friendly, introducing 31 regulatory changes that stifle efficiency and quality of regulation”.
Jamaica was the top named Caribbean Community country, ranked at number 71 of the 190 countries surveyed, followed by St Lucia (93) Trinidad and Tobago (105), Dominica (111), Antigua and Barbuda (113), The Bahamas (119), Barbados (128), St Vincent and the Grenadines (130), Guyana (134), Belize (135), St Kitts-Nevis (139), Grenada (146), Suriname (162) and Haiti (179).
The World Bank noted that economies that score highest on the ease of doing business share several common features, including the widespread use of electronic systems. It said all of the 20 top-ranking economies have online business incorporation processes, have electronic tax-filing platforms, and allow online procedures related to property transfers.
The regions with the most cumbersome tax compliance processes remain Latin America and the Caribbean and Sub-Saharan Africa.
The World Bank notes also that no economies from Latin America and the Caribbean appeared in the 10 top improvers list over the past two years.
“Moreover, not a single economy in Latin America and the Caribbean ranks among the top 50 on the ease of doing business. The regional leader on the ease of doing business score, Mexico, is still almost 12 percentage points below the average score of the 10 top-ranking economies,” the report said.
Globally, reforms in the areas of dealing with construction permits and getting electricity have risen sharply in recent years, peaking in 2018/19 at 37 and 34, respectively.
“In the area of getting electricity, several Caribbean countries, including Barbados and Belize, invested in training utility personnel and capacity- building,” the World Bank said, noting that the most common features of property registration reform included greater transparency of information, better reliability of infrastructure, and reduced taxes and fees.
“Across regions, economies in the Middle East and North Africa improved the most. Qatar created a one-stop shop, eliminating five procedures and lowering property transfer time by 11 days. In Latin America and the Caribbean, Jamaica reduced the cost of property registration by almost seven per cent of the property value. Brazil and Ecuador introduced electronic property-transfer systems,” the World Bank added.
<< Back to news headlines >>
Investment in renewable energy in Latin America reaches historical levels Monday 30th December, 2019 – Dominican Today
Latin America surpasses Asia-Pacific to become the second most popular region for solar and wind energy projects
The renewable energy market in Latin America is registering an unprecedented increase in foreign investments in new facilities, led by Brazil, Chile, and Mexico.
Latin America experienced record levels of foreign direct investment in renewable energy, with 97 projects valued at US $ 17.8 billion, in the first 10 months of 2019 – a marked increase compared to an annual average of 50 projects since 2013 – according to fDi Markets, a Financial Times (FT) data service that monitors announcements of foreign companies about investments in jobs and new facilities.
For the first time, Latin America is the second most attractive region in the world for foreign investment in renewable energy, only behind Europe, both in terms of capital expenditure and in number of projects, revolutionizing what has been a career for many years of two between Europe and Asia-Pacific, according to data from fDi Markets. During this time, Técnicos Consultores, from Spain, has been the most active investor in the region.
Although Costa Rica generates more than 95 percent of its electricity from renewable energies, the largest countries in Latin America have attracted, of course, the largest investment.
In fact, Brazil, Chile, and Mexico are among the top five destinations in the world for foreign investment in renewable energy – in terms of the number of projects since January 201 – together with Spain and the US, according to fDi Markets.
In Latin America, Brazil has shone brighter, accounting for 40 percent of all foreign investment projects in renewable energy this year, followed by Chile (29 percent), Mexico (15 percent) and Colombia (6 percent), with capital flows that show a similar hierarchy.
<< Back to news headlines >>
Card switch moves Tuesday 31st December, 2019 – Barbados Today
Minister of Small Business and Entrepreneurship Dwight Sutherland is calling on the credit union movement to create a locally issued pre-paid debit card system to replace the Caribbean Integrated Financial Services Inc. (CariFS) network scheduled to end in September 2020.
CariFS links all the ATMs in Barbados to allow its member financial institutions to dispense cash on a 24-hour basis to their customers, using the entire network of over 100 ATMs.
This call comes as banks forge ahead with plans to use VISA as the switching agent which effectively, would deem the local CariFS switch redundant.
Speaking at the dinner and awards ceremony of the Lifetime Co- operative Credit Union Anniversary and Awards Ceremony at the Accra Beach Hotel & Spa, Rockley, Christ Church last Saturday, Sutherland said the credit unions account for 20 per cent of CariFS activity which is reported to be a total 1.9 million transactions per year.
“The Government of Barbados will work with the credit unions to find an alternative platform to CariFS and will focus on how the credit unions can find an ICT solution for customer payments in light of this decision by the Barbados Bankers’ Association.
“I have already initiated discussions with members of the credit union movement to decide on a way forward. I have also put out a call to the biggest communications provider, Cable & Wireless and its sister company FLOW to get in on the act to work with Government and the credit unions to launch an electronic payment network very soon,” he said.
Minister Sutherland also noted that he was happy to hear that the Barbados Cooperative & Credit Union Limited and Capita Financial Services Inc will be joining efforts to launch an international debit card by June 2020 to mitigate the impact of the closure of the existing CariFS network in September next year.
“However, I want to encourage the movement to examine the use of a locally-issued prepaid debit card which could be adopted as a low-cost solution to the switching problem.
“It means therefore that local transactions will be settled in Barbados Currency and reduce the flight of foreign exchange that will occur with the usage of the international Visa or MasterCard debit card,” he said.
President of the Lifetime Anthony Branker said the credit union can boast of over 5 600 members and assets of $67 million up to August 31 when it marked its 30th anniversary.
Brancker said that Lifetime, formerly known as the Barbados Shipping and Trading Employees Cooperative Credit Union, was established to help employees of the company that was the single largest employer on the island at that time.
Founders and longstanding members of the credit union were recognised for their outstanding contributions to the financial institution.
<< Back to news headlines >>
IDB report says government transactions burdensome Tuesday 31st December, 2019 – Barbados Today
The length of time it takes to carry out a transaction with government agencies continues to be a sore point for citizens, according to one of Barbados’ development partners who is recommending that improvements take place more quickly.
The Inter-American Development Bank (IDB) said there was evidence that while citizens in the Caribbean tend to enjoy shorter wait times than their counterparts in Latin America, an average of 4.3 hours per transaction versus 5.3 hours in Latin America, they are nevertheless “burdened with having to return to public offices repeatedly.
In fact, in its publication Wait No More: Citizens, Red Tape, and Digital Government, the Caribbean Edition, the authors said over 30 per cent of transactions required three visits or more.
“Similarly, though the rates of bribery are generally lower than in Latin America, they are still considerable, ranging from nine to 27 per cent. The relatively incipient development of digital government in the region highlights that there is much room for improvement for reducing the overall transactional burden for citizens and making their experiences with government more efficient,” it said.
The report identified several problems with government transactions including the slow pace and high costs for both citizens and firms.
According to the report, it takes an average of 4.8 hours to complete a government transaction in Barbados, better than the 5.9 hours it takes in Guyana, but worse than the 4.1 hours it takes in Jamaica, 3.9 hours in Trinidad and Tobago and 2.8 hours in the Bahamas.
In the case of the Caribbean, 26 per cent of all government transactions were completed in less than an hour, as opposed to 21 percent in Latin America.
“Fifty-one per cent required two hours or more for successful completion, 21 per cent needed five hours or more, and 8 per cent, 10 hours or more,” the report said.
It further noted that in Jamaica, just 11 per cent of all transactions were completed in one visit, and more than 45 per cent of all transactions required three or more visits to a public office to be completed.
“In Barbados, only 23 per cent of the transactions were completed in one visit, and 43 per cent required three visits or more,” it added.
Acknowledging that multiple interactions can happen for various reasons, it said multiple interactions generate transaction costs for citizens even if every individual visit is short.
“In addition to the difficulties for citizens, these multiple interactions also imply efficiency losses for the government, which is forced to earmark more resources for providing citizen services. Finally, it also raises questions about attrition: it is plausible that the more interactions that a transaction requires, the greater the probability that people abandon the process,” it pointed out.
The 56-page document pointed out that digital transactions could “solve many of the problems facing modern bureaucracies” since they were faster, cheaper to provide, and less vulnerable to corruption.
“Unfortunately, implementation and use of digital transactions in the region is extremely low – only eight per cent of citizens in the Caribbean report having carried out their last government transaction online,” it said.
The survey showed however, that Barbados had the highest average of 17 per cent of those surveyed who said their last government transaction was through a digital channel.
The report recognized that Barbados was among countries in the region carrying out programmes to boost competitiveness and improve citizen engagement, as it highlighted government’s US$40 million Public Sector Modernization programme, which is being funded by the IDB.
While there continued to be concerns about the lingering issues relating to carrying out a transaction with government, the document pointed out that in general, the large majority of citizens was satisfied with these transactions.
“One possible explanation is that citizens see the difficulty of the transaction, manifested in requirements and paperwork, as a proxy for protection against fraud,” it explained.
The bank puts forward several recommendations, saying authorities should study the citizen experience with government transactions so they can better identify problems and fix them effectively; eliminate as many government transactions as possible; redesign government transactions with the citizen experience in mind; facilitate access to digital transactions; and invest in high quality face-to-face government transactions.
With some 90 per cent of government transactions still being carried out in person in the Caribbean, the IDB said while progress was being made in digital development, it was vital to improve the most commonly used and, in some cases, most preferred, channel of service provision – face-to- face.
<< Back to news headlines >>
Sagicor looks to buy back Tuesday 31st December, 2019 – Nation News
Fresh from an ownership change that has left it holding more cash, Sagicor is looking to buy back US$320 million in securities from institutional investors overseas.
But the company says it does not expect any “material” takers of the offer, given that the notes in question are trading at a premium higher than the price that is now on the table until next month.
This comes amid some senior personnel changes at the group, including Ravi Rambarran succeeding the retiring Dr Patricia Downes-Grant as president and chief executive officer of Sagicor Life Inc., effective December 16.
Sagicor also has a new board chaired by Timothy Hodgson. Effective December 17, Andrew Aleong, Dr Jeannine Comma, Marjorie Fyffe- Campbell, Richard Kellman, Richard P. Young, and William Lucie-Smith are no longer directors of the company.
<< Back to news headlines >>
Central Bank affirms that the RD economy has recovered Tuesday 31st December, 2019 – Dominican Today
The Central Bank said that economic activity has recovered by expanding interannually by 5.1% in September and 5.2% in October this year.
The entity affirmed that in this context of dynamism of aggregate demand, economic growth is expected to be around its 5.0% potential by the end of 2019 and during 2020.
In the external sector, the bank indicated that currency generating activities, such as foreign direct investment and remittances continue to show good performance, compensating for the recent moderation of tourism, which is expected to recover in the coming months.
In this complex international environment, the Dominican Republic has managed to strengthen its macroeconomic fundamentals, maintaining the relative stability of the exchange rate and continuing with the process of accumulation of International Reserves, which would end 2019 around US $ 8.5 billion, its historical level plus high for a year-end.
The entity indicated that due to these data, at its monetary policy meeting in December 2019, it decided to maintain its monetary policy interest rate at 4.50% per year.
The decision on the reference rate is based on a detailed analysis of the risk balance with respect to inflation forecasts, including international and domestic macroeconomic indicators, market expectations and medium- term projections.
November’s monthly inflation was 0.37%, while accumulated inflation stood at 3.45%. On the other hand, both the inflation expectations of the economic analysts and the forecasting system of the BCRD indicate that inflation would close the year 2019 below the central value of the target and would remain around 4.0% during 2020.
In the international environment, economic uncertainty has moderated slightly in recent months to the extent that the first phase of a trade agreement between the United States and China has been achieved, while there is greater clarity about the exit of the Kingdom United of the European Union.
<< Back to news headlines >>
CIF jumps to $28.52 Tuesday 31st December, 2019 – Trinidad Express Newspaper
OVERALL market activity resulted from trading in 13 securities of which eight advanced, three declined and two traded firm.
Trading activity on the first tier market registered a volume of 152,624 shares crossing the floor of the Exchange valued at $2,343,857.39.
The Composite Index declined by 2.99 points (0.20 per cent) to close at 1,478.52.
The All T& T Index advanced by 1.22 points (0.07 per cent) to close at 1,865.30. • The Cross Listed Index declined by 0.99 points (0.66 per cent) to close at 147.93.
The SME Index advanced by 0.05 points (0.07 per cent) to close at 67.76.
National Enterprises Ltd was the volume leader with 83,955 shares changing hands for a value of $483,580.80, followed by JMMB Group Ltd with a volume of 33,000 shares being traded for $84,713.16. West Indian Tobacco Company contributed 10,195 shares with a value of $423,474.33, while Scotiabank T& T added 8,063 shares valued at $491,823.
CLICO Investment Fund registered the day's largest gain, increasing $1.29 to end the day at $28.52. Conversely, Prestige Holdings Ltd registered the day's largest decline, falling $0.25 to close at $9.00.
CLICO Investment Fund was the only active security on the mutual fund market, posting a volume of 17,026 shares valued at $485,665.10. CLI - CO Investment Fund advanced by $1.29 to end at $28.52. Calypso Macro Index Fund remained at $15.75.
The second tier market did not witness any activity.
CinemaOne was the only active security on the SME Market, posting a volume of 503 shares valued at $3,294.65. CinemaOne advanced by $0.05 to end at $6.55. Endeavour Holdings Ltd remained at $12.50. The USD equity market did not witness any activity. MPC Caribbean Clean Energy remained at US$1.
<< Back to news headlines >>
Euro gains and sterling shines as growth optimism cheers investors Tuesday 31st December, 2019 – Caribbean News Now
After staying strong for much of 2019 thanks to the relative outperformance of the U.S. economy and investors’ preference for a safe- haven currency amid the trade dispute between Washington and Beijing, the dollar’s gains for the year have shrivelled in December.
The buoyant end-of-year sentiment enocouraged investors to buy up currencies linked to trade and global growth, sending many such as the Australian dollar, Chinese yuan and Scandinavian crowns to multi-month or multi-week highs against the greenback.
The dollar index was last down 0.3% at 96.435 .DXY, its weakest since July 1. In thin volumes on the last day of the decade, currencies were also more volatile than many had expected.
Analysts did not attribute the moves to any specific new developments. “I can’t see much reason for the movement in the FX market except end- year position squaring, or just being careful and cutting positions ahead of the New Year’s holiday and the start of 2020. As a result I wouldn’t draw any big conclusions from it,” said Marshal Gittler, currency analyst at ACLS Global.
Chinese Vice Premier Liu He will visit Washington this week to sign a Phase 1 trade deal with the United States, the South China Morning Post reported on Monday.
White House trade adviser Peter Navarro said on Monday the trade deal would likely be signed in the next week, but that confirmation would come from President Donald Trump or the U.S. trade representative.
Investors' appetite for risk helped drive the euro EUR=EBS up 0.3% to $1.1230, a new 4-1/2-month high.
Signs that the euro zone economy may be stabilising have lifted the common currency in recent weeks as investors unwound short positions, though the currency has shed around 2% of its value against the dollar in 2019.
Latest CFTC data shows that hedge funds held $9.16 billion of euro shorts, far less than the $14.84 billion seen in May. EURNETUSD=
The U.S. dollar was weak across the board, cutting 2019 gains for the index that tracks the greenback against a basket of currencies to 0.3% .DXY. MUFG analysts saw a “bearish technical development for the U.S. dollar that signals an increasing risk of further weakness ahead”.
“Weakness in the U.S. dollar towards the end of this year has coincided with the renewed expansion of the Fed’s balance and the paring back of pessimism over the outlook for global growth,” they said.
Versus the Japanese yen, the dollar fell to a near three-week low of 108.50 yen JPY=EBS and was last down 0.4%.
“STAND OUT PERFORMER”
Against the Chinese yuan, it shed 0.4% to 6.9586 in the offshore market CNH=EBS, a 2-1/2-week low, as strong Chinese economic data helped boost the Chinese currency.
The Australian dollar climbed 0.3% to a new five-month high of $0.7014 versus the U.S. dollar AUD=D3.
The New Zealand dollar firmed another 0.2% to a 5-month high NZD=D3 of $0.6742. MUFG analysts noted that the currency "remains the stand out performer of the last quarter, surging nearly 8% over the past three months, largely on the back of more positive sentiment about global trade".
For 2019, however, the Kiwi is up just 0.4%.
Scandinavian currencies also strengthened against the greenback following all-time lows seen this year on the back of global growth fears sparked by the U.S.-Chinese trade disputes.
Sterling hit new two-week highs against the dollar, although the possibility of a ‘no-deal’ Brexit at the end of 2020 means the currency is still not close to where it was on Dec. 12, the day Prime Minister Boris Johnson won the British election.
The pound galloped 0.8% to as high as at $1.3212 GBP=D3 and was 0.5% stronger against the euro at 85 pence EURGBP=D3.
Sterling has gained around 3.5% against the dollar in 2019 and 5.4% versus the euro as fears of an imminent disorderly exit from the European Union eased and then lifted with the passing of Johnson’s Brexit withdrawal agreement in parliament.
<< Back to news headlines >>
Britain says will raise minimum wage by more than 6% in 2020 Tuesday 31st December, 2019 – Reuters
Britain’s national minimum wage will rise by more than 6% next year, taking it to 8.74 pounds an hour, the government announced on Tuesday.
The move puts Britain on track to meet its target for the minimum wage to reach 60% of median earnings by 2020, it added.
“Hard work should always pay, but for too long, people haven’t seen the pay rises they deserve,” Prime Minister Boris Johnson said in a statement. Related Coverage
UK to raise National Living Wage by 6.2%, finance minister Javid says - The Sun Britain’s unemployment rate has fallen to its lowest since the 1970s and employment recently hit a record high, despite the minimum wage rising by more than a quarter since 2015 to now stand at 8.21 pounds an hour for those aged 25 and over.
The rise to 8.74 pounds is due to take place on April 1.
Minimum pay rates for younger workers will also increase by between 4.6% and 6.5%, depending on their age, the government said.
The British Chambers of Commerce (BCC) said: “Raising wage floors by more than double the rate of inflation will pile further pressure on cash flow and eat into training and investment budgets.
“For this policy to be sustainable, government must offset these costs by reducing others - and impose a moratorium on any further upfront costs for business.”
Britain’s minimum wage was introduced under Labour Prime Minister Tony Blair in 1999, and rose relatively modestly following the annual advice of a committee of academics, trade unionists and business representatives.
In 2015, faced with complaints about stagnant living standards, Conservative finance minister George Osborne said he wanted to raise the minimum wage for over-25s to 60% of median earnings by 2020 - implying bigger annual increases.
The Resolution Foundation, an anti-poverty think-tank, said in May that Britain should slow the rate at which it increases its minimum wage to avoid the risk of low-paid workers being priced out of a job during the next recession.
Johnson pledged to raise the minimum wage to 10.50 pounds an hour by 2024 during the run-up to his landslide election victory on Dec. 12.
<< Back to news headlines >>