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▪ HMB Limited’s proposed collateralised mortgage obligation rating assigned at CariAA- (SO)

▪ NCB Capital Markets (Barbados) Limited’s initial rating assigned at CariBBB-

▪ Government of Barbados’s local currency rating upgraded to CariBB

▪ PanJam Investment Limited’s initial rating assigned at CariBBB+

▪ Saint Lucia Electricity Services Limited’s rating reaffirmed at CariBBB ▪ TSTT’s existing rating reaffirmed and new proposed bond issue rating assigned at CariA ▪ Jamaica Public Service Company Limited’s initial rating assigned at CariBBB+

▪ Endeavour Holdings Limited’s rating reaffirmed at CariA+

▪ Island Car Rentals Limited’s initial rating assigned at jmBBB+

▪ The Pegasus Hotels of Guyana Limited’s rating upgraded to CariBBB

▪ The National Gas Company of Trinidad and Tobago’s rating reaffirmed at CariAA+

▪ Home Mortgage Bank’s rating reaffirmed at CariA

▪ NCB Cayman Limited’s rating reaffirmed at CariA

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Fundamentals of Financial Analysis 28th & 29th March 2019 Trinidad

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REGIONAL

Trinidad and Tobago

GHL adds $0.98

OVERALL market activity resulted from trading in 12 securities of which

three advanced, four declined and five traded firm.

TTARP scores two victories

The TT Association of Retired Persons (TTARP) recently scored two major

victories for seniors.

CAL aims to lead regional carriers

Over the past decade Caribbean Airlines Ltd (CAL), the national carrier of

TT, has served the region with flights to both international and regional

destinations. And though it has had its ups and downs, the airline

declared an operating profit in 2018.

Barbados

Closing the loophole

The Revenue Authority is losing $50 million in Value Added Tax (VAT)

returns because it is unable to collect taxes outside of Barbados, senators

learned today.

Jamaica

Jamaica's cruise tourism earns $22.6 billion

Preliminary data from the Statistical Institute of Jamaica shows that cruise

tourism has seen an almost 300 per cent increase in earnings over the last

10 years.

Guyana

Exxon increases estimate to 5.5 billion barrels

United States oil giant ExxonMobil has updated its gross recoverable

resource estimate to 5.5 billion barrels of oil equivalent in the Stabroek

Block in Guyana.

Guyana continued

IDB Report reveals…Electricity, high tax rates, corruption most serious

obstacles to local businesses

The private sector is touted as the engine of growth in Guyana. Yet, it

continues to face significant constraints which hinder its potential.

The Bahamas

Banks’ Bad Loans Strike Ten-Year Low

Bad loans commercial banking industry borrowers dropped to under

$800m at end-January 2019, falling to their “lowest levels for ten years”.

BPL To Seek Shell Equity for Its $95m

Bahamas Power & Light (BPL) will likely take an equity ownership interest in

Shell’s new power plant in return for its $95m emergency generation

investment, it was revealed yesterday.

Antigua and Barbuda

Burma Quarry workers refuse to work overtime

Workers at the Burma Quarry have decided that enough is enough when

it comes to a matter affecting their pay packets.

Bank staff back on job – for now

Staff at Global Bank of Commerce have suspended industrial action

against the company following discussions by the bank’s management

with the Antigua and Barbuda Workers Union (ABWU).

British Virgin Islands

Look for new DDM building job, contractors told

The bidding process for construction of the new building for the

Department of Disaster Management (DDM) and the National Emergency

Operations Centre (NEOC) are projected to begin soon.

All gov’t ministers getting 3 months as Deputy Premier, Wheatley the first

appointee

In what can be described as an unconventional move, Premier Andrew

Fahie is giving each of the ministers in his government an opportunity to

serve as Deputy Premier.

Costa Rica

SuGEF relaxes bank reserves to boost credit

The Superintendencia General de Entidades Financieras (SuGEF) –

General Superintendency of Financial Institutions – relaxed the rule that

requires financial institutions to create reserves to protect themselves in

case of deterioration of their loans.

The Dominican Republic

Energy Efficiency Plan could cut consumption 13.2%

If the Energy and Mines Ministry’s National Energy Efficiency Plan is

applied, the country could save 3,276 gigawatts per year, or a 13.2% cut

in consumption until 2030.

Venezuela

Venezuela's Guaido urges more sanctions after German expulsion

Venezuela’s opposition leader Juan Guaido urged Europe to tighten

financial sanctions against the government of Nicolas Maduro after it

expelled Germany’s ambassador, a magazine quoted him as saying on

Thursday.

INTERNATIONAL

United States

Persistent low U.S. jobless rate should help minority employment catch up

Maintaining the U.S. unemployment rate at its current low level is likely to

bring black and Hispanic jobless rates closer to that of whites, a team of

researchers including San Francisco Federal Reserve president Mary Daly

concluded in a paper released on Thursday.

United Kingdom

Britain matches EU offer to maintain flights in no-deal Brexit scenario

Britain said on Thursday it would match an offer by the European Union to

protect airlines’ flying rights in the event of a no-deal Brexit, tackling one

of the main concerns that planes could be grounded and lead to travel

chaos.

United Kingdom continued

UK parliament will vote on May's Brexit deal on March 12

British lawmakers will vote on whether to approve Prime Minister Theresa

May’s revised Brexit deal on March 12, the leader of the House of

Commons Andrea Leadsom said on Thursday.

Europe

Exports, investment, consumption drive euro zone fourth quarter GDP

slowing growth

Net exports, investment and consumption drove euro zone economic

growth in the last quarter of 2018, data showed on Thursday, offsetting a

sharp drop in inventories.

48 financial firms apply to move to Germany in Brexit planning

German regulators have received 48 applications in recent months from

financial firms seeking to relocate to Germany in the wake of Britain’s

decision to leave the European Union, an official said on Thursday.

Greek economic expansion slows in fourth quarter, recovery on track

Greece’s economy shrank in the last three months of 2018 after

expanding for nine consecutive quarters, government data showed on

Thursday, with the annual pace of growth also slowing.

China

China says higher 2019 budget deficit will spur growth, won't open

floodgates

China’s decision to increase its budget deficit ratio to 2.8 percent this year

from 2.6 percent in 2018 is appropriate for the economy, and leaves room

for policymakers to manoeuvre, Finance Minister Liu Kun said on Thursday.

China February forex reserves rise to six-month high, eases outflow worry

China’s foreign exchange reserves in February rose to their highest in six

months as growing optimism over U.S.-China trade talks buoyed the yuan

currency, easing worries about capital outflows from the slowing

economy.

China approves 10 new airline routes from Beijing's new airport

China has approved plans by China Eastern Airlines, Xiamen Air and

Capital Airlines to fly out of Beijing’s new mega-airport from September to

cities such as Moscow, Cairo and Busan.

Japan

Japan's Renesas to partially halt chip production for two months on China

slowdown

Automotive chipmaker Renesas Electronics Corp plans to halt production

at six plants in Japan for up to two months this year as it braces for a

further slowdown in Chinese demand, the company said on Thursday.

Softbank launches $5 billion fund to invest in LatAm tech firms

Japan’s Softbank Group Corp said on Thursday it had launched a new $5

billion innovation fund to invest in technology companies in Latin America.

Global

Euro clings to $1.13 as ECB stimulus signal awaited

The euro held near three-week lows on Thursday, before a European

Central Bank meeting that many hope will signal fresh stimulus and inject

some life into currencies stuck in trading ranges.

Global stocks stuck in worst run of the year ahead of ECB

World stocks were stuck in their worst run of the year and bonds were on

the rise on Thursday, as investors waited for confirmation that the

European Central Bank will start shoveling cheap cash at the euro zone

again.

FX trading volumes shrink in February as volatility slides

Trading volumes of currencies shrank 7.6 percent in February from a year

earlier, Refinitiv data showed, as a slump in foreign exchange price

volatility discouraged traders from buying and selling.

Britain matches EU offer to maintain flights in no-deal Brexit scenario Thursday 7th March, 2019 – Reuters

Britain said on Thursday it would match an offer by the European Union to

protect airlines’ flying rights in the event of a no-deal Brexit, tackling one

of the main concerns that planes could be grounded and lead to travel

chaos.

The Department for Transport said the government was still working to

secure a withdrawal and transition deal with Brussels, but that as part of its

preparations for all eventualities it had agreed to reciprocate EU plans.

The EU executive has proposed allowing British airlines to fly to and from EU

airports for 12 months after March 29, assuming Britain offered equivalent

rights to EU airlines.

Britain said on Thursday for the 12-month period it intended to grant EU air

carriers a level of access to the UK at least equivalent to the rights that

would be granted to UK airlines under the EU’s regulation.

“This includes traffic rights, ownership and control, leasing of aircraft,

cooperative marketing arrangements and fair competition,” it said.

It said it would also go further and allow member state airlines to operate

wholly within the UK for the IATA summer season 2019, which ends on 27

October 2019, to maintain connections between regional bases.

Ryanair boss Michael O’Leary had been vocal in warning that planes

could be grounded if Britain leaves the EU without a deal. Rival easyJet

has established a new airline in Austria to protect its rights.

<< Back to news headlines >>

UK parliament will vote on May's Brexit deal on March 12 Thursday 7th March, 2019 – Reuters

British lawmakers will vote on whether to approve Prime Minister Theresa

May’s revised Brexit deal on March 12, the leader of the House of

Commons Andrea Leadsom said on Thursday.

May has been seeking changes to her deal, after it was rejected by a

record majority in parliament in January.

If the deal is rejected again, Leadsom said she would make a statement

at that point setting out the timetable for fulfilling May’s commitment to

give parliament votes next week on whether to leave the EU without a

deal on March 29 or delay Brexit.


Japan's Renesas to partially halt chip production for two months on China

slowdown Thursday 7th March, 2019 – Reuters

Automotive chipmaker Renesas Electronics Corp plans to halt production

at six plants in Japan for up to two months this year as it braces for a

further slowdown in Chinese demand, the company said on Thursday.

The company is considering halting front-end production at the plants for

a month around May and again for a month around August to avoid

excessive chip inventories amid uncertainties stemming from Sino-U.S.

trade frictions.

Back-end production at three other plants in Japan, as well as four plants

in China and Malaysia, may be also temporarily suspended on a weekly

basis several times, the company said.

Renesas expects chip demand for autos, machine tools and air

conditioners to slip further this year, a company spokesman said.

The suspension plans, first reported by media late Wednesday, spooked

investors and drove down Renesas shares by their daily allowable limit of

100 yen, or 14.6 percent, to 584 yen on the Tokyo stock exchange on

Thursday.

On Wednesday, Hyundai Motor Co said it was considering plans to

suspend production at its oldest plant in China, as the South Korean

carmaker reels from tumbling sales and massive overcapacity in its

biggest market.

China’s car sales contracted for the first time since the 1990s last year, hit

by a weakening economy and the fallout of trade frictions with the United

States.


Softbank launches $5 billion fund to invest in LatAm tech firms Thursday 7th March, 2019 – Reuters

Japan’s Softbank Group Corp said on Thursday it had launched a new $5

billion innovation fund to invest in technology companies in Latin America.

Softbank, which already has a $100 billion investment vehicle known as

Softbank Vision Fund, has made sizeable investments in ride-hailing firm

Uber Technologies Inc, shared office provider WeWork, food delivery start-

up DoorDash and dog walking app Wag.

"Latin America presents significant opportunities for SoftBank Group, and

the Vision Fund will have the ability to co-invest alongside the SoftBank

Innovation Fund," executive officer of SoftBank Investment Advisers Rajeev

Misra said.


China says higher 2019 budget deficit will spur growth, won't open

floodgates Thursday 7th March, 2019 – Reuters

China’s decision to increase its budget deficit ratio to 2.8 percent this year

from 2.6 percent in 2018 is appropriate for the economy, and leaves room

for policymakers to manoeuvre, Finance Minister Liu Kun said on Thursday.

But a proactive fiscal policy does not mean China will open the

floodgates for stimulus, Liu said at a news conference on the sidelines of

the annual parliamentary meeting in Beijing, reiterating past government

pledges of restraint.

Global investors are closely watching how forcefully Beijing will support the

economy after growth in 2018 slowed to a near 30-year low. A key market

focus is how policymakers will balance the need for growth against the

threat of a further flare-up in financial risks and debt.

“We will not spend a penny that is not supposed to be spent, and we’ll

strive to guarantee the money that is supposed to be spent,” Liu said.

Premier Li Keqiang told the opening of parliament on Tuesday that China

is planning billions of dollars in additional tax cuts and infrastructure

spending, amid pressure from softer domestic demand and a trade war

with the United States.

The premier also announced the slightly higher target for the budget

deficit to GDP ratio and a lower annual economic growth target of 6-6.5

percent, both of which had been widely expected.

For 2019, Beijing is planning cuts of nearly 2 trillion yuan ($298 billion) in

taxes and fees for companies, featuring long-awaited reductions in value-

added tax for manufacturing, transport and construction sectors. It has

not yet announced when the VAT cuts will take effect.

Liu acknowledged that the planned tax cuts will exert some pressure on

local government finances, but he pledged more funds will be transferred

from the central government to localities.

“Considering the downward pressure on the economy and the upcoming

policy of larger tax and fee cuts, some regions will still face relatively big

budgetary pressure this year,” said Liu.

PROVINCES IN TRANSITION

Many provinces across China are in the midst of a long-term economic

transformation as President Xi Jinping urges industries to move away from

low-value, polluting manufacturing.

Shanxi, a northern province traditionally known for its coal resources, is

building solar plants in old mining districts in its renewable energy push,

and like other provinces, has not been spared from the broader

economic slowdown.

To shore up its corporate sector, Shanxi reduced taxes by 57.3 billion yuan

($8.5 billion) in 2018 and cut fees of 6 billion yuan, with 90 percent of the

companies benefiting from the tax cuts being private firms, Wu Tao, head

of the Shanxi provincial government’s finance department, said on the

sidelines of parliament on Wednesday.

“Since last year, we have overcome difficulties and spared no effort in

pushing forward the implementation of tax and fee cuts, even though

fiscal revenues, which once dropped for two consecutive years, are still in

a stage of recovery,” Wu said.

Shanxi is expected to cut taxes and fees by another 31.2 billion yuan this

year, he said.

Shanxi has reported falling government revenues in 2015 and 2016.

The finance minister said the central government is highly concerned

about the cases of some provinces having difficulties in paying salaries,

maintaining operations and social security.

Local governments will be allowed to issue 2.15 trillion yuan worth of

special purpose bonds in 2019, up 59 percent from last year. Such bonds

are not included in the government budget and for funding key

investment projects.

“The arrangement on the budget deficit ratio has fully considered factors

including fiscal revenue and local government special bonds and leaves

more policy room for future macro adjustments,” Liu said.

The government will also look to offset some of the reduction in fiscal

revenue from the tax cuts by collecting more profits from certain state-

owned financial institutions and centrally-owed enterprises, Liu said,

without giving more details.

Local governments will also have to secure funding via other channels, he

added.

“In this regard, some funds will be raised, which allows us not to raise the

deficit ratio too high.”

But Liu said some local governments are still raising debt illegally and

Beijing will not allow new hidden debt.


China February forex reserves rise to six-month high, eases outflow worry Thursday 7th March, 2019 – Reuters

China’s foreign exchange reserves in February rose to their highest in six

months as growing optimism over U.S.-China trade talks buoyed the yuan

currency, easing worries about capital outflows from the slowing

economy.

While China’s economy continues to cool, analysts believe the risk of

strong capital outflows has greatly diminished in recent months as the

yuan regained its footing and foreign investors piled back into the

country’s battered stock markets.

Chinese foreign exchange reserves, the world’s largest rose by $2.26 billion

in February to $3.090 trillion, central bank data showed on Thursday,

marking the highest level since August 2018.

Economists polled by Reuters had expected reserves would fall $920

million to $3.087 trillion.

The yuan gained 0.09 percent against dollar in February, and is up more

than 2 percent so far this year. The dollar index against other major

currencies rose 0.6 percent in February.

Financial markets’ bearish outlook on the yuan has seen a remarkable

reversal in the last few months due to a host of factors: growing optimism

for a U.S.-Sino trade agreement, a soft U.S. dollar and a sharp rise in

foreign investors’ inflows into Chinese stocks and bonds.

A Reuters poll on Wednesday showed the yuan is expected to trade

around current levels of 6.70 to the dollar in a year’s time, in sharp contrast

to January when most analysts forecast it would drop through the 7-mark

to decade lows.

As part of a possible trade deal, Washington is reportedly pressing China

for a promise that it will not devalue its currency, which has further

underpinned the yuan.

A source briefed on the trade negotiations said on Sunday that the

world’s largest economies appear close to an agreement that would roll

back U.S. tariffs on Chinese goods, as Washington urges China to make

structural economic changes and eliminate retaliatory tariffs on U.S.

goods.

China’s state planner pledged on Tuesday to increase the flexibility of the

yuan’s exchange rate, setting off speculation that a tweak to official

wording could mean changes to its tightly managed currency regime.

China’s economic growth cooled to 6.6 percent in 2018, the slowest pace

in 28 years, and is widely expected to lose more momentum this year.

GO WITH THE FLOWS?

So far, tighter Chinese capital controls have discouraged heavy outflows

like those seen in the last downturn in 2015, but the yuan still fell 5.3

percent versus the dollar last year.

Though not a major factor, increasing inflows of foreign capital have

helped offset some of the pressure this year.

Net flows into the Shanghai and Shenzhen stock markets via the Stock

Connect scheme as of end February topped 120 billion yuan ($17.9

billion), nearly four times that in the first two months of 2018.

Overseas investors are also showing a strong, sustained appetite for

Chinese government bonds as the country’s debt is added into main

global benchmarks this year.

For now, analysts are closely watching both trade talks and Chinese

economic data for clues on where the yuan goes next.

Even if Washington and Beijing reach a deal to end their trade war, China

is expected to implement more measures in coming months to avert the

risk of a sharper economic slowdown. More forceful policy easing

measures such as interest rate cuts could put the yuan back under the

gun.

The value of China’s gold reserves rose slightly to $79.498 billion in February

from $79.319 billion at the end of January, as the central bank increased

the total amount of gold reserves to 60.260 million fine troy ounces from

59.940 million troy ounces.

The central bank did not explain why it bought more gold.


China approves 10 new airline routes from Beijing's new airport Thursday 7th March, 2019 – Reuters

China has approved plans by China Eastern Airlines, Xiamen Air and

Capital Airlines to fly out of Beijing’s new mega-airport from September to

cities such as Moscow, Cairo and Busan.

The Civil Aviation Administration of China said in a statement on its

website on Thursday that it had approved 32 new airline routes, 10 of

which will be from Beijing Daxing International Airport in September and

October.

Of the 10, five were proposed by Hainan Airlines unit Beijing-based Capital

Airlines, one by China Southern Airlines subsidiary Xiamen Air and four by

China Eastern Airlines.

The airport, due to open in September, can handle 72 million passengers

a year by 2025 and is expected to become one of the world’s busiest

airports upon completion.

This will be the city’s second such facility and help relieve pressure on

Beijing Capital International Airport, whose annual capacity has reached

100 million passengers.

Airlines including China Southern, China Eastern, Capital Airlines and

China United Airlines will be relocated to the new airport, while carriers

such as Air China Hainan Airlines and Grand China Air will stay at the old

facility.


Persistent low U.S. jobless rate should help minority employment catch up Thursday 7th March, 2019 – Reuters

Maintaining the U.S. unemployment rate at its current low level is likely to

bring black and Hispanic jobless rates closer to that of whites, a team of

researchers including San Francisco Federal Reserve president Mary Daly

concluded in a paper released on Thursday.

The current national unemployment rate of 4 percent is below most

estimates of full employment, and running that sort of “hot” economy for

as long as possible could also narrow the gap in jobless rates between the

less educated and those with college degrees, the team found in an

exploration of whether periods of particularly low unemployment narrow

some of the persistent gaps in unemployment between different groups.

The study looked at the differences in unemployment rates among

people with different education levels, and between whites on one hand,

and blacks and Hispanics on the other.

“We read the overall evidence ... as indicating that the employment

experience of ... African Americans and Hispanics, as well as that of those

with less than a college degree, has improved relatively more compared

to whites of the same gender as the labour market has strengthened,” the

group concluded in the paper released as part of a Brookings Institution

economic research conference this week.

The research reaffirms a long list of studies over the years concluding that

minority groups and the less educated lose their jobs faster in downturns,

but benefit as conditions improve and markets tighten.

In the years after the 2007-2009 financial crisis, for example, the

unemployment rate for whites fell to just below 8 percent by August 2011

but persisted at 16.4 percent for blacks, near its recession-era high. As of

November it was around 6 percent for blacks and 3.5 percent for whites.

This most recent research comes as the Fed is considering just how long it

can keep rates at their current level without risking inflation or other costs.

The current unemployment rate is below most estimates of what can be

sustained without inflation. However, there is little evidence inflation is

accelerating, and many at the Fed feel the unemployment rate could fall

even further and stay there.

The paper also looked at whether a longer period of low unemployment

might help lagging rural areas to catch up, but concluded the causes of

poor rural performance “seem to be structural and are not ameliorated

by a strong national labour market.”


Exports, investment, consumption drive euro zone fourth quarter GDP

slowing growth Thursday 7th March, 2019 – Reuters

Net exports, investment and consumption drove euro zone economic

growth in the last quarter of 2018, data showed on Thursday, offsetting a

sharp drop in inventories.

The European Union’s statistics office Eurostat confirmed its earlier

estimate that gross domestic product in the 19 countries sharing the euro

rose 0.2 percent quarter on quarter in the October-December period.

It revised down to 1.1 percent the year-on-year number for the fourth

quarter from 1.2 percent estimated in February.

The numbers confirm a slowdown in the euro zone economy from the

more robust growth rates in the first and second quarters of 2018 — a

factor which markets expect the European Central Bank to take into

account by phasing out more slowly its monetary stimulus to the

economy.

Eurostat said household and government consumption added 0.1

percentage point each to the final quarterly growth result and investment

also added 0.1 point. Net trade gave an additional 0.2 points helping

offset a 0.4 point drop in inventories.

Employment in the euro zone rose 0.3 percent on the quarter and 1.3

percent year-on-year, with the highest number of jobs added in

construction and information and communication services and the

biggest number of jobs disappearing in agriculture, forestry and fishing,

arts, entertainment and financial and insurance activities.


48 financial firms apply to move to Germany in Brexit planning Thursday 7th March, 2019 – Reuters

German regulators have received 48 applications in recent months from

financial firms seeking to relocate to Germany in the wake of Britain’s

decision to leave the European Union, an official said on Thursday.

Elisabeth Roegele, an executive director with Germany’s Bafin financial

markets watchdog, said that more applications could still come.

“There are still companies that are only now dealing with the issue,” she

added.


Greek economic expansion slows in fourth quarter, recovery on track Thursday 7th March, 2019 – Reuters

Greece’s economy shrank in the last three months of 2018 after

expanding for nine consecutive quarters, government data showed on

Thursday, with the annual pace of growth also slowing.

Seasonally adjusted data released by the country’s statistics service

showed gross domestic product contracted by 0.1 percent in the fourth

quarter from the third, when it expanded by 1.0 percent.

Despite the slight contraction, the data showed Greece’s recovery

remains largely on track after a lengthy recession that shrank its economy

by a quarter.

“The growth of the Greek economy, for a second year in a row, is a first

positive step on the way to normality,” said Eurobank chief economist

Tassos Anastasatos.

“Deceleration of economic activity in Q4 2018, mainly due to a decline in

fixed investments, reflects remaining uncertainties.”

On an annual basis, economic expansion decelerated to 1.6 percent in

the fourth quarter from a downwardly revised 2.1 percent clip in the

previous quarter.

“Private consumption along with net exports were the main drivers, but

continuing weakness in investment spending - gross capital formation -

was a drag,” said National Bank economist Nikos Magginas.

Looking at 2018 as a whole, the data pointed to a 1.9 percent growth

rate, slightly below initial estimates.

Other data released on Thursday showed unemployment in December

fell to 18.0 percent from 18.3 percent in November, the lowest reading

since July 2011 but still the highest in the euro zone.

In its latest enhanced surveillance report, issued last month, the European

Union Commission projected real GDP growth of 2.0 percent in 2018,

picking up to 2.2 percent this year and to 2.3 percent in 2019.

It sees domestic growth drivers - private consumption and investment -

strengthening, but the contribution from the external sector moderating as

imports rise and the EU’s economic growth slow.

“Looking at this year, we expect private consumption to remain a pillar,

helped by a rise in disposable incomes,” Magginas said. “Net exports will

likely contribute positively but at a softer pace due to a slowdown in the

euro area.”


Euro clings to $1.13 as ECB stimulus signal awaited Thursday 7th March, 2019 – Reuters

The euro held near three-week lows on Thursday, before a European

Central Bank meeting that many hope will signal fresh stimulus and inject

some life into currencies stuck in trading ranges.

The euro/dollar exchange rate has had a quiet start to 2019 as central

banks have put off tightening monetary policy as economic momentum

slows. That has left investors struggling to decide on direction.

Analysts said expectations the ECB will signal new cheap bank loans had

largely been priced in, so the focus would be on the bank’s economic

forecasts and indications of whether it will further delay a rate increase

the market expects in mid-2020.

The ECB is expected to cut growth forecasts and provide its strongest

signal yet that more cheap long-term bank loans are coming.

“We don’t expect the ECB to make any changes but signal that changes

are imminent,” said Thu Lan Nguyen, a currencies analyst at

Commerzbank. “The risks are that the euro gives up a bit more. The risks

are to the downside.”

The euro was little changed at $1.1313, but euro overnight implied

volatility climbed overnight to its highest since Dec. 20.

The dollar, measured against a basket of currencies, stood at 96.875.

“Waiting for the overvalued dollar to reverse course requires patience,

and is itself one driver of the lack of FX volatility,” Societe Generale

strategist Kit Juckes said.

The dollar should slip over the coming year because U.S. economic

growth is slowing and any boost from a resolution in the U.S.-China trade

conflict is already priced in, according to a Reuters poll of strategists.

EASING STANCE

The Canadian and Australian dollars remained near two-month lows after

investors bet their central banks would ease monetary policy as their

economies slow.

The Aussie fell to a two-month low of $0.70205 after weaker-than-

expected retail sales data, then recovered by 0.2 percent to $0.7049.

The Canadian dollar slid to its lowest since Jan. 4 after the Bank of

Canada on Wednesday said there was “increased uncertainty” about

future rate increases. It recovered to C$ 1.3426 on Thursday.

Sterling stabilized near $1.3150 as investors look toward next week’s British

parliamentary votes on a proposed Brexit withdrawal.

The Japanese yen and Swiss franc gained marginally as financial investors

turned cautious about the outlook for growth.


Global stocks stuck in worst run of the year ahead of ECB Thursday 7th March, 2019 – Reuters

World stocks were stuck in their worst run of the year and bonds were on

the rise on Thursday, as investors waited for confirmation that the

European Central Bank will start shovelling cheap cash at the euro zone

again.

The ECB was holding its second meeting of the year, and with the euro

almost motionless and stocks suffering from the same growth nerves that

will see the central bank chop its in-house forecasts later, markets were

poised.

European shares retreated further from five-month highs as MSCI’s 47-

country world share index also dropped for a fourth straight session to set

its longest losing streak since December’s rout.

Italy’s government bonds rallied to a 7-month high while its banks, which

used the biggest share of the previous round of cheap central bank loans,

rose 0.1 percent but remained below the highs hit in the previous session.

A return to what was once its flagship crisis-fighting tool would be a

wrenching change of direction for the ECB just months after it wound

down its 2.6 trillion-euro QE program,

But Head of investments at UK fund manager Hermes, Eoin Murray, said he

wondered how much impact such measures, or even more U.S. Fed

stimulus, would have, considering the potency has tended to wane with

every new round in recent years.

“I just don’t think it will have the power to get the economy to the point of

take-off,” Murray said.

Europe’s subdued mood came after Asia and Wall Street had also both

stumbled overnight.

MSCI’s broadest index of Asia-Pacific shares outside Japan edged 0.3

percent lower on Thursday, yet hovering not far from its five-month high

marked last week, and was up 10 percent year-to-date.

Japan’s Nikkei average fell 0.7 percent, while Hong Kong’s Hang Seng

shed 0.7 percent and Chinese blue-chips snapped a four-day winning

streak as the boost from new stimulus plans there ran into the sand.

Wall Street’s main indexes had fallen for a third straight session, with the

S&P 500 posting its biggest one-day decline in a month, as investors

sought reasons to buy after a near 20 percent rally since the start the year.

“For some time, markets had been pricing in good news, namely that the

talks between the U.S. and China will likely go well,” said Tatsushi Maeno,

senior strategist at Okasan Asset Management. “Now markets are having

a pause.”

Adding to concerns about the talks was data that showed the U.S. goods

trade deficit surged to a record high in 2018 as strong domestic demand

pulled in imports, despite the Trump administration’s “America First”

policies aimed at shrinking the gap.

Other U.S. data out on Wednesday suggested some slowing in the labour

market, though the pace of job gains remains more than enough to drive

the unemployment rate down.

The ADP National Employment Report showed private payrolls increased

by 183,000 in February after surging 300,000 in January. Economists polled

by Reuters had forecast private payrolls advancing 189,000 in February.

The government’s more comprehensive “non-farm” payrolls employment

report for February is scheduled for release on Friday.

TIME TO TLRTO?

In the currency market, the euro traded at $1.1304, hovering near a two-

week low ahead of the ECB and its expected news on its cheap long-

term loans for banks, known more formally as Targeted Long-Term

Refinancing Operations (TLTROs).

The dollar was little changed at 111.74 yen, moving away from Tuesday’s

2-1/2-month peak of 112.135, while the dollar index, which measures the

greenback against a basket of six of its peers, barely moved at 96.887.

The Canadian and Australian dollar sank to two-month lows on

Wednesday as traders scaled back holdings on expectations policy-

makers would leave interest rates alone in the foreseeable future or even

lower them to counter their softening economies.

Adding to the Aussie’s woes on Thursday was data showing local retailers

suffered another bleak month in January, in a sign overall economic

momentum was slowing. The Aussie dollar last changed hands at $0.7042,

up 0.1 percent on the day.

Brexit uncertainty kept the pound below an eight-month high hit last week

as investors waited for some clarity to emerge out of negotiations

between Britain and the European Union.

Diplomats said talks in Brussels on Tuesday led by British Prime Minister

Theresa May’s chief lawyer, Geoffrey Cox, failed to find common ground,

with three weeks to go before Britain’s scheduled departure on March 29.

“Markets are getting conflicting signals from lawmakers in Britain and the

negative news flow from Brussels on the negotiation process, and that is

keeping the pound in a tight range,” said Nikolay Markov, a senior

economist at Pictet Asset Management.

Among commodities, oil edged up amid ongoing OPEC-led supply cuts

and U.S. sanctions against exporters Venezuela and Iran, although prices

were prevented from rising further by record U.S. crude output and rising

commercial fuel inventories.

U.S. crude futures rose 0.1 percent to $56.29 per barrel, moving closer to its

3-1/2-month high of $57.88 touched Friday, while international benchmark

Brent futures gained 0.3 percent to $66.20 per barrel.


FX trading volumes shrink in February as volatility slides Thursday 7th March, 2019 – Reuters

Trading volumes of currencies shrank 7.6 percent in February from a year

earlier, Refinitiv data showed, as a slump in foreign exchange price

volatility discouraged traders from buying and selling.

Average daily trading volumes touched $428 billion in February, down

from $463 billion a year earlier and $446 billion in January, Refinitiv said in a

statement published late on Wednesday.

Declining activity in the spot market was behind the fall, with spot volumes

- at $87 billion - having their worst month since August 2017. Other

volumes, which include swaps and options, held up much better.

Foreign exchange volatility, which is often correlated with trading volume

growth, has slumped in 2019 as central banks move together in pressing

pause on plans to tighten monetary policy.


Exxon increases estimate to 5.5 billion barrels Thursday 7th March 2019 – Guyana Chronicle

United States oil giant ExxonMobil has updated its gross recoverable

resource estimate to 5.5 billion barrels of oil equivalent in the Stabroek

Block in Guyana.

The announcement came on Wednesday at the company’s 2019 Investor

Day by way of webcast and was also included in its 2019 Investor Day

report. “The success story that I highlighted last year has continued. We

ended up with five new discoveries in the Stabroek Block in 2018. We’ve

already had two new discoveries in 2019. We’re still to quantify those last

two discoveries but last year I’d said we’d increase our resource to 3.2

billion oil equivalent barrels [and], as you can see from the numbers that

are on the chart, we’ve closed to double that in just 12 months,” Senior

Vice President at Exxon Mobil Corporation Neil Chapman said.

The report noted that there were 5 new discoveries in 2019 and two in

2019 with the total number of discoveries to date in the south eastern part

of the Stabroek Block at 12.

Speaking on the current border controversy between Guyana and

Venezuela, Chapman highlighted that none of the discoveries of

ExxonMobil thus far are in the area under debate.

“Looking at that block you can see where our discoveries are. They are all

in the South-East corner of this block. It has been well noted in the public

around the border dispute with Venezuela [but] it’s a long, long way from

where our discoveries are and where our activity is and there’s no dispute

between the countries,” he said.

The report listed Guyana and Brazil as amongst the most valuable plays in

the industry stating, too, that there is a robust inventory of additional

prospects in Guyana with significant upside potential. For the 2019-2020

periods, Chapman said ExxonMobil plans to drill approximately 10

additional exploration wells even as it has increased the number of its

FPSOs from 3 to 5.

Other updates provided show that at Liza Phase 1, topside modules were

installed; integration is ongoing; offshore installation will commence in the

second quarter of 2019; Liza Destiny is expected in Guyana in the second

quarter of 2019 and start up is expected in the early first quarter of 2020.

Meanwhile, regarding Liza Phase 2, Final Investment Decision (FID) is

planned for the first quarter of 2019 and it is on schedule for start-up in

2022.

At Payara, early engineering is progressing; environmental permitting was

initiated; FID is expected in the fourth quarter of 2019 while start-up is

expected in 2023. Guyana’s outlook production for 2025 was increased

from 500 to 750 while the report stated that among the five outstanding

developments influencing ExxonMobil’s growing value of portfolio is

Deepwater Guyana.

Chapman commended the Government of Guyana for its partnership

stating that there have been excellent relations thus far. “We’ve had

really strong support and a great partnership with the Guyanese

government,” he said. “President Granger implemented a new Ministry of

Energy last year; Dr. Bynoe is heading that up. It’s a great partnership

between the operators, ourselves and the government.”

The company believes that considerable potential remains for Guyana

and stated that the more it discovers, the more it is understanding

Guyana’s about the geology and believes that the prospects are even

greater in the basin.


IDB Report reveals…Electricity, high tax rates, corruption most serious

obstacles to local businesses Thursday 7th March 2019 – Kaieteur News

The private sector is touted as the engine of growth in Guyana. Yet, it

continues to face significant constraints which hinder its potential.

According to a report by the Inter-American Development Bank (IDB),

‘Constraints Affecting Guyana’s Private Sector: Survey Results,’ electricity,

high taxes and corruption are ranked the most serious obstacles to local

businesses.

With respect to electricity, the IDB said that this was deemed the most

serious obstacle to businesses in Guyana. The institution said that this is not

surprising, since it takes approximately 104 days to obtain an electrical

connection. The Bank highlighted that this is significantly above the

average of 62 days for obtaining a connection in the Caribbean.

The Bank said that the firms surveyed also indicated that they experience

an average of eight power outages per month with an average duration

of three hours. This, the Bank pointed out, is also the highest when

compared to the rest of the Caribbean.

Further to this, the IDB said that the estimated loss from power outages for

firms in Guyana exceeds the levels incurred by their counterparts in the

Caribbean. In fact, the Bank’s data indicates that the estimated loss

approximates 1.6 percent of annual sales, compared with a regional

average of 0.7 percent of annual sales.

CORRUPTION

Corruption, the Bank noted, was the second highest-ranked constraint

identified by businesses. The Bank said that 34.45 percent of the firms

surveyed view corruption as a major obstacle while 43.7 percent consider

it a very severe obstacle.

Notwithstanding the claim that corruption is a major or severe obstacle,

the IDB said that a relatively small percentage of firms surveyed indicated

that they were expected to pay a bribe to obtain an operating licence,

electrical connection, telephone connection, import licence, water

connection, and construction permits.

Based on the survey, the Bank said that approximately 6.7 percent of the

firms indicated they were expected to pay a bribe to obtain the contract,

while 3.3 percent of the firms claimed they were expected to pay a bribe

to tax officers.

Further to this, the financial institution noted that the cost incurred by

businesses in Guyana related to making informal payments (or bribes) to

‘get things done’ is higher than the amount paid by their counterparts in

the Caribbean. In this regard, the Bank noted that the bribe paid for

various government services is approximately four percent, significantly

higher than the regional average of 1.8 percent. It also stands out as the

highest in the Caribbean. The Bank also noted that the cost of the bribe is

relatively higher for businesses in the following sectors: machinery and

equipment, fabricated metal products, and wholesale.

HIGH TAX RATES

With regard to high tax rates, the IDB noted that local firms ranked this as

a significant obstacle to their operations.

It said, “Indeed, tax rates were ranked third as the most serious

obstacle…This may be attributed to the fact that Guyana has one of the

highest corporate tax rates in Latin America and the Caribbean. Some

studies have found that the high tax rates motivate businesses to operate

in the informal sector…”

Notwithstanding the relationship between high tax rates and the size of

the informal economy, the IDB said that most of the firms surveyed paid

their required taxes. In fact, the IDB data revealed that approximately 13.3

percent of the firms paid less tax than required by law, while the

remaining 86.7 percent of firms paid their fair share of taxes.

COMPETITION

Apart from the aforementioned, the IDB said that competition in the

informal sector was noted as an issue of concern.

The IDB said, “The practices of competitors in the informal sector were

ranked as the fourth most serious obstacle for businesses operating locally.

The survey revealed that approximately 94.4 percent and 88.9 percent of

the firms consider this factor as a serious constraint because their

counterparts in the informal sector can circumvent rules and regulations

and are not subject to rules of entry, respectively.”

ACCESS TO FINANCE

Another issue of concern for local businesses was access to finance.

In this regard, the IDB’s survey revealed that 6.7 percent of the firms

regard this factor as the most serious obstacle for doing business. It said

that most firms that view access to finance as a major or very severe

obstacle are small and medium-scale enterprises. It also stands true for

medium-scale firms.

Expounding further, the Bank said, “Most firms that consider access to

finance as a major or severe obstacle are privately owned. These include

sole proprietorship (24.4 percent major obstacle, 28.9 percent very severe

obstacle), partnership including limited liability partnerships (18.8 percent

major obstacle, 12.5 percent very severe), limited partnership (9.1 percent

major obstacle; 18.2 percent very severe obstacle), and shareholding

company with no traded shares (22.5 percent major obstacle).”

The Bank also noted that locally owned firms are most affected by access

to finance.


Banks’ Bad Loans Strike Ten-Year Low Wednesday 6th March 2019 – Tribune 242

Bad loans commercial banking industry borrowers dropped to under

$800m at end-January 2019, falling to their “lowest levels for ten years”.

The Central Bank of The Bahamas’ report on January’s economic

developments revealed that borrower arrears has fallen to its lowest level

since the 2008-2009 financial crisis, providing a further glimmer of optimism

that the economy may finally be moving towards recovery.

“Banks’ credit quality indicators continued to improve over the review

period,” the Central Bank said. “Specifically, total private sector arrears

decreased by $10.7m (1.3 percent), to $799.1m, and the ratio to total

private sector loans contracted by 18 basis points to 14.1 percent - the

lowest rate in ten years.

“On a year-on-year basis, the total arrears ratios moved lower by 1.3

percentage points, as both the short-term and non-performing loan rates

softened by 70 and 59 basis points, respectively. Broad-based reductions

were recorded across all loan categories, with the mortgage, consumer

and commercial arrears rates narrowing by 1.7, 1.2 and 0.3 percentage

points, respectively.”

However, the good news was partially offset by the fact January’s decline

was driven entirely by a fall in short-term arrears. Non-performing credit,

meaning loans that are 90 days or more past due, increased during the

month to indicate that there are still too many Bahamians struggling to

meet their repayment obligations.

“The reduction was due mainly to an $18.6m (6.4 percent) decline in

short-term arrears (31 to 90 days) to $274.3m, while the corresponding

ratio fell by 32 basis points to 4.8 percent,” the Central Bank confirmed. “In

a partial offset, non-performing loans (NPLs), firmed by $7.9m (1.5 percent)

to $524.9m, and by 14 basis points to 9.2 percent of total private sector

loans.

“Disaggregated by loan type, the overall decrease in arrears was mainly

attributed to a $15.7m (3.2 percent) contraction in mortgage

delinquencies to $483.7m, as both the short and long-term components

fell by $9.4m (5.7 percent) and $6.4m (1.9 percent), respectively.

“In addition, consumer loan arrears softened by $0.7m (0.3 percent) to

$228.6m, as the 31-90-day segment decreased by $8.4m (8.8 percent), in

contrast to the $7.7m (5.8 percent) rise in NPLs.

“In contrast, the commercial component rose by $5.7m (7 percent) due

to a $6.6m (13.7 percent) rise in long-term delinquencies, which

overshadowed the $0.8m (2.5 percent) fall-off in short-term arrears.”

Bahamian commercial banks increased their loan loss provisions by $8.5m

or 1.9 percent to $447m in line with the rise in non-performing loans. “As a

consequence, the ratio of total provisions to arrears firmed by 1.8

percentage points to 55.9 percent,” the Central Bank said.

“In addition, the total provisions to NPL ratio edged-up by 35 basis points

to 85.2 percent. At the end of January, banks’ write-offs and recoveries

amounted to $6.2m and $1.2m, respectively.”

Bahamian businesses and households are still deleveraging, as local

currency credit outstanding fell by $31.4m in January - a smaller decline

than the $52.1m contraction experienced in the same month in 2018.

“The decline in private sector credit was extended by $6.8m to $17.7m,”

the Central Bank said of January 2019, “as growth in commercial credit

tapered to $6.9m from $17.8m last year, while consumer loans and

mortgages fell further by $16.8m and $7.7m, relative to $19.9m and $8.8m

in 2018.”


BPL To Seek Shell Equity for Its $95m Wednesday 6th March 2019 – Tribune 242

Bahamas Power & Light (BPL) will likely take an equity ownership interest in

Shell’s new power plant in return for its $95m emergency generation

investment, it was revealed yesterday.

Whitney Heastie, BPL’s chief executive, told Tribune Business that the

severity of New Providence’s energy crisis meant the utility had “no

option” but to act ahead of sealing the agreement with Shell to address

the capital’s power needs long-term.

Arguing that Bahamian households and businesses cannot wait until 2022,

when the Shell power plant is scheduled to become operational, to enjoy

much-reduced energy costs and more reliable supply, Mr Heastie

described BPL’s 132-megawatt (MW) deal with Wartsila as a “precursor to

what will be done” by the energy giant.

He added that Wartsila’s seven engines will effectively be “rolled into the

Shell project”, with BPL using the 132 MW to bridge the three-year gap

until the latter’s arrival and eliminate load shedding, blackouts and eight

years of relying on temporary rental generation units to make up the

shortfall.

“BPL is just making the initial investment,” Mr Heastie explained of the

$95m Wartsila deal. “It has no option but to try and stabilise the shortfall in

generation. What we’re doing today all falls under Shell tomorrow, when

the LNG facility is available for it to run on LNG. This is a precursor to what

will be done by Shell.”

While BPL and Shell North America last year signed a Memorandum of

Understanding (MoU) to formalise the latter’s selection as the preferred

bidder to build, own and operate a new 220 MW power plant at Clifton

Pier, the two sides have yet to tie down a power purchase agreement

(PPA) and other commercial terms.

BPL’s newly-announced deal with Wartsila effectively gives it a headstart

in addressing New Providence’s energy woes in advance of agreeing all

terms with Shell, including the price at which the state-owned utility will

buy electricity from the new plant.

The Shell plant will be designed to run on multiple fuels, including heavy

fuel oil (HFO), diesel and liquefied natural gas (LNG), and the seven

engines to be supplied by Wartsila match these requirements so that they

can be seamlessly incorporated into the former’s new plant when it is

constructed

Mr Heastie yesterday said Shell will still be responsible for adding the final

90 MW of generation to bring its plant up to the agreed 220 MW capacity,

along with construction of the onshore and offshore infrastructure needed

to facilitate use of LNG.

He added that this will include LNG storage and regasification facilities at

Clifton Pier, together with a jetty and cryogenic line, to enable Shell’s

plant to use LNG as one of its fuel source options from 2022 onwards.

With BPL’s Wartsila deal bringing in 60 percent of the new power plant’s

capacity, Mr Heastie said the state-owned utility now has to discuss with

Shell how it will be compensated for making a $95m investment that the

energy giant will ultimately benefit from.

“We’re in the initial stages of having definitive discussions with Shell now

that we’ve signed the MoU,” he told Tribune Business. “So, one of the

things we will talk to Shell about is how the 132 MW rolls into their project.

“We still have to define with them how the value of these assets [the 132

MW] will roll into the overall project. It may be that BPL takes an equity

stake in the project. We could not wait, in all fairness to Shell, until there’s

a definitive agreement. There’s no mechanism for them to invest as

there’s no contract between us now.

“The mindset here was because of what we have been experiencing on

the fuel charge, we’ve got to be able to provide some relief to the

Bahamian public, or public in general. This 132 MW is obviously about 50

percent of peak demand, and we anticipate that once this is complete

there will be a significant shift downwards in what consumers pay based

on the fuel charge.”

Mr Heastie explanation answers Paul Maynard, the Bahamas Electrical

Workers Union’s (BEWU) president, who yesterday questioned whether BPL

would recover - or receive compensation for - a $95m investment that will

ultimately accrue to Shell’s benefit.

“Shell owes this country $95m,” Mr Maynard charged. “In 2021-2022,

when they take over, they will get a new power plant. I want to know

when they will give back $95m to this country. It means that they owe us

money. That has to happen, that has to be a part of it. I can’t see it not

being a part of it.

“It means they [Shell] only have to provide 90 MW. Their budget was

$300m, from what I understand. We’ve spent $95m for them, and they

need to give us this money back.”

Mr Maynard, who represents BPL’s unionised line workers, said his difficulty

with the Wartsila agreement lay “in what is not being said” by senior

executives. “The devil is in the details, as they say,” he told Tribune

Business.

“There are a lot of missing components that normally accompany a

contract of this nature. For example, training (operations and

maintenance), critical spares, warranty engineering support. Is the $95m a

turnkey price or is it just the price of the engines.

“Shipping and transport from Italy to Clifton, HFO and LNG requires

additional auxiliaries for fuel treatment and regasification, respectively.”

Mr Heastie, though, confirmed to Tribune Business that $95m is the ‘all-in’

price that includes the cost of the seven engines together with their

shipping and installation.

Mr Maynard, though, made clear his unhappiness that the union had

been left out of the Wartsila discussions. He suggested that this broke with

previous protocols where the BEWU had been “involved”, and consulted

on, the past installation of new engines at both Clifton Pier and Blue Hills

power stations.

The union chief also hit out at BPL’s decision to “outsource” operation and

maintenance of the new 132 MW to Wartsila, even though the same will

happen under Shell. The latter’s deal with BPL will split generation from

transmission and distribution, with the state-owned utility focusing solely on

the latter on New Providence, and Shell acting as an independent power

producer (IPP).

“My concern is that our people have to run the plant because we’re

paying $95m. We have to run it. They didn’t come to the union, and we

need to talk about this training component,” Mr Maynard told Tribune

Business.

“My thing is that BPL was originally supposed to get 60 MW from them

[Wartsila]. I don’t understand why we’re going down this road. Shell was

supposed to do this. I don’t understand why we’re paying.

“It’s not going to help them this summer, that’s for sure, and that’s a

problem. My thing is I would have preferred turbines to these engines.

That’s how I feel. The chief executive likes reciprocating engines, but we

need to get into modern technology such as aeroderivative turbines.”

Mr Heastie, though, said Shell had been fully involved in the selection of

Wartsila and its generation technology to ensure it fitted with the long-

term power plant plans.

BPL had started moving antiquated generation assets, which it no longer

uses, out of Clifton Pier’s building ‘A’ from November last year to make

way for the new 132 MW. The “pedestals” upon which the old two-stroke

turbines rested are now being raised to the main floor’s level, with

“significant improvements” to both engine houses and substations now on

the way.

“What we’re doing is outsourcing the operation and maintenance of that

plant to Wartsila, or a Wartsila-qualified service provider will be operating

that facility,” Mr Heastie told Tribune Business. “They’re going to be

responsible for providing the training for persons to operate that facility.

“We have stipulated that the majority of personnel are Bahamian. We

would prefer them to hire individuals with diesel plant generation

experience and train them on the four-speed engines. There’s no one in

New Providence today with that experience on four-speed engines.”

Mr Heastie said the new power plant operator will be held accountable

by having to meet key performance indicators, such as reliability,

availability and cost, which will be based on global energy industry

standards.

He added that, once the 132 MW becomes operational in October-

November 2019, BPL will be able to reduce its reliance on the Blue Hills

power station that burns the more expensive diesel fuel.

The utility is currently generating 80 percent of New Providence’s energy

needs from Blue Hills, which is why customer fuel charges have soared, a

situation not helped by last September’s Clifton Pier fires that took out 63

MW of BPL’s most efficient engines.

Mr Heastie confirmed that BPL was behind on maintenance of its

generation assets as a result of capacity shortfalls, which meant it could

not turbines off-line when it wanted to service them. The utility typically

seeks to complete all scheduled maintenance by March/April every year,

in time to meet peak summer demand, but this will continue into those

months in 2019.

BPL’s immediate problem now is to get through summer 2019 without

incurring frequent blackouts and load shedding, while it waits for the new

142 MW to be installed. Mr Heastie conceded this will be challenging

given the utility’s aged, strained infrastructure, and he confirmed it was

seeking an extra 30 MW in rental generation to help get it through.

“We want our consumers to be energy conscious and conserve as much

as they can in the summer months,” he told Tribune Business. “We’re

optimistic, and certainly thinking that if we make it through this summer it

will be smoother sailing thereafter. We’re going to be tested on this one,

but if we make it through, we will be in good shape.”


Closing the loophole Thursday 7th March, 2019 – Barbados Today

The Revenue Authority is losing $50 million in Value Added Tax (VAT)

returns because it is unable to collect taxes outside of Barbados, senators

learned today.

Speaking in the Senate today during debate on the Value Added Tax

Amendment Bill 2019 Senator Dr Crystal Haynes pointed out that

Government was losing a substantial amount of revenue due to BRA’s

limitations.

The amendment will allow Government to collect VAT on goods and

services purchased online from a vendor outside of the island for use here.

The legislation also empowers the Government to collect VAT on goods

and services purchased online from local vendors for local – even if the

transaction is processed outside of Barbados.

Senator Haynes told the Upper Chamber: “It has been estimated that we

have been losing about $50 million in VAT revenues because the BRA

does not have the jurisdiction to operate in terms of tax collection outside

of Barbados. So one of the things which this legislation has spoken to is

that it makes reference to a tax collecting agent.”

She revealed that a proposal had gone out and following applications

from several tenders, a company had been selected to act as the

Government’s tax collection for these online transactions.

Dr Haynes said the technology had been “tried and tested” and was

currently being used by 46 US states.

But several items purchased online would be exempt from VAT, she told

lawmakers.

For example, a Barbadian who bought a plane ticket to travel from

Barbados would not have to pay the tax, as the service was not being

consumed in Barbados, she said.

As education had always been a VAT exempt service, it would remain

unaffected, and other categories, including pharmaceuticals and

hospital supplies, would also be VAT-exempt, she added.

Assuring citizens that these new tax collection tentacles would not reach

into the pockets of citizens travelling abroad, Senator Haynes said: “This is

a tax on online transactions, so I would just like the public to remember

that they won’t have to worry that when they travel to New York or travel

to see family in England and you use your card that you are going to

have this tax applied. It is not a tax on credit cards. It is specifically

attached to close the loophole on online transactions.”


Jamaica's cruise tourism earns $22.6 billion Thursday 7th March, 2019 – Jamaica Observer

Preliminary data from the Statistical Institute of Jamaica shows that cruise

tourism has seen an almost 300 per cent increase in earnings over the last

10 years.

In 2008, the sector earned $7.5 billion and in 2017 cruise saw earnings of

$22.6 billion.

“Cruise tourism for Jamaica has been a long journey of growth and

development over many years and it began much like all other industries

with a small beginning then mushroomed into proportions that today we

can regard as an integral part of the fabric of our economy,” said Bartlett,

who made the announcement at a Jamaica Vacations' (JAMVAC's)

Cruise Council cocktail party last Wednesday.

“What we recognise as well is that cruise provides the best and most

immediate form of conversion of wealth into the pockets and economies

of the local destination. The impact of this sizeable earning therefore has

been instantaneous in the communities across the country,” he added.

JAMVAC Ltd, an agency of the Ministry of Tourism, has direct responsibility

for cruise. JAMVAC has since been an important player in Jamaica's

growing cruise industry which last year received a significant boost with

vessels including Marella Cruise, Carnival Horizon and Ms Sirena arriving in

Jamaican waters for the very first time.

Last year more than 4.3 million visitors arrived in Jamaica; 2.4 million via

airports and a further 1.8 million by cruise. These visitors generated

approximately US$3.3 billion in earnings, an 8.6 per cent increase over

2017.

“The indications are that cruise earnings for 2018, are apace if not ahead

of 2017 and that means it has made a bigger contribution to the overall

US$3.3 billion we earned last year for tourism overall.

“We want to grow cruise by looking at new ports and new possibilities and

the prime minister has spearheaded the whole transformation

approaches for a new port in Port Royal which will have a sea walk facility

to enable a collapsible jetty that will be able to dock huge ships in the

Port Royal Harbour by the end of this year and we have secure done

vessel that will come in 2020,” Bartlett said.

JAMVAC's Executive Director Joy Roberts noted that 2018 was an

incredible year for Jamaican tourism and the agency, as they were able

to see their strategies and work bear fruit.

“Jamaica has so much to offer as a destination and that is why it was

important for us to promote brand Jamaica not only to the traditional

markets but to also seek new markets with diverse interests. I have no

doubt that 2019 will prove to be an even better year for Jamaican

tourism,” Roberts said.

Increased cruise arrivals is a key component in the ministry's strategy to

not only increase overall economic growth but to practise inclusive

tourism.

Benefits from cruise tourism positively affect a wide range of small and

medium sized tourism enterprises (SMTEs) as well as local service providers

including contract carriage operators, craft vendors, artisans, food and

beverage producers, local community groups, DJs and entertainers.

JAMVAC has been employing new strategies to enhance the cruise

experience by providing entertainment at each port and getting real time

feedback from cruise passengers through their digital happy or not

monitors.


Energy Efficiency Plan could cut consumption 13.2% Wednesday 6th March, 2019 – Dominican Today

If the Energy and Mines Ministry’s National Energy Efficiency Plan is

applied, the country could save 3,276 gigawatts per year, or a 13.2% cut

in consumption until 2030.

Energy and Mines minister Antonio Isa Conde said if such plans were

applied throughout the country, in industries, in commerce, in tourism

businesses and homes, the savings would be comparable to a 250-

megawatt plant.

Isa said despite the progress in terms of savings, he’s not satisfied “even

with the people around me.”

He stressed that the need to save must become part of the people’s

awareness.

To mark World Energy Efficiency Day, Isa urged for the end of the waste

culture in the use of energy. “The issue is part of the Electric Pact,

demonized by political sectors suffering from myopia, since it

contemplates as mandate the implementation of the Energy Efficiency

Law.”


Venezuela's Guaido urges more sanctions after German expulsion Thursday 7th March, 2019 – Reuters

Venezuela’s opposition leader Juan Guaido urged Europe to tighten

financial sanctions against the government of Nicolas Maduro after it

expelled Germany’s ambassador, a magazine quoted him as saying on

Thursday.

It was the latest flashpoint in a global showdown over Venezuela, with

Western nations largely recognizing Guaido as legitimate head of state,

but Russia and China still supporting the socialist Maduro and urging non-

interference.

“This action represents a threat against Germany,” Guaido told Der

Spiegel after Caracas declared ambassador Daniel Kriener persona non

grata. He and other diplomats had welcomed home Guaido at Caracas

airport earlier this week.

“I hope that Europe reacts sharply to this serious threat against an

ambassador,” Guaido added. “Above all, they should tighten financial

sanctions against the regime.”

Germany is among the many nations backing Guaido’s plan to install a

transition government ahead of free elections.

He denounces Maduro as a usurper whose re-election last year resulted

from a sham vote. Maduro says he is victim of a U.S.-led coup attempt

and “economic war”.

German Foreign Minister Heiko Maas on Wednesday called Venezuela’s

action “incomprehensible” and said Germany and its European partners

would continue to back Guaido.

He said the ambassador would be returning home for consultations.

Guaido, however, said he had asked Kriener to stay, since Maduro was

not empowered to expel a diplomat as he was “occupying the post of

president illegally.”

The international community should act to prevent Maduro using

Venezuelan taxpayer funds to “kill critics of the regime and indigenous

peoples, as is already happening at the border to Brazil,” he said in

reference to recent violence there.


GHL adds $0.98 Thursday 7th March, 2019 – Trinidad Express Newspapers

OVERALL market activity resulted from trading in 12 securities of which

three advanced, four declined and five traded firm.

The Composite Index declined by 2.78 points (0.21 per cent) to close at

1,331.05. The All T& T Index advanced by 0.72 points (0.04 per cent) to

close at 1,763.32.

The Cross Listed Index declined by 0.87 points (0.71 per cent) to close at

121.30. The SME Index remained at 99.50.

Trading activity on the first-tier market registered a volume of 191,500

shares crossing the floor of the Exchange valued at $1,177,669.54.

GraceKennedy was the volume leader with 156,176 shares changing

hands for a value of $484,145.60, followed by Guardian Holdings Ltd with

a volume of 25,000 shares being traded for $474,500. TTNGL contributed

3,853 shares with a value of $115,804.89, while JMMB Group added 2,857

shares valued at $4,999.75.

Guardian Holdings Ltd registered the day's largest gain, increasing $0.98

to end the day at $18.98. Conversely, Republic Financial Holdings Ltd

registered the day's largest decline, falling $1.24 to close at $118.76.

CLICO Investment was the only active security on the mutual fund market,

posting a volume of 13,092 shares valued at $264,398. CLICO Investment

Fund remained at $20.20. Calypso Macro Index Fund remained at $13.60.

The second-tier market did not witness any

activity. The SME market did not witness any activity. CinemaOne

remained at $9.95. The USD equity market did not witness any activity.

MPC Caribbean Clean Energy remained at US$1.00.


TTARP scores two victories Thursday 7th March, 2019 – Trinidad and Tobago Newsday

The TT Association of Retired Persons (TTARP) recently scored two major

victories for seniors.

The first was to get Government to give the country’s retired public

servants an interim payment of $3,000 a month because of the lengthy

period it takes the public service to process pension payments. The

department is required to track work history in the service, a process that

could take as long as two years.

Retired public servants will now receive the interim payment while their

work records are processed, after which they will receive their arrears and

their correct pension payments.

The second victory scored by TTARP is a senior citizens' grant, which

becomes payable when a retiree reaches 65, and is only payable to

people who earn a combined monthly income of less than $5,000.

According to Government, this combined income includes NIS pension

and any other occupational pensions.

Over the years TTARP has lobbied persistently for enhanced benefits for its

membership. Other achievements include increases in national insurance

pensions; increases in the tax allowance and free transport with the

introduction of the bus pass.

At last September’s AGM at the Centre of Excellence in Macoya, the

board referred to its mission statement, which focuses on enhancing the

quality of life for senior citizens. It said, “Our future is defined in the phrase

‘forever young.’ It does not mean forever young in age. It means forever

young in attitude, it means forever young in mind, it means forever young

in purpose.”


CAL aims to lead regional carriers Thursday 7th March, 2019 – Trinidad and Tobago Newsday

Over the past decade Caribbean Airlines Ltd (CAL), the national carrier of

TT, has served the region with flights to both international and regional

destinations. And though it has had its ups and downs, the airline

declared an operating profit in 2018.

Now, the airline’s CEO Garvin Medera has said he is making an all-out

effort to put the airline at the forefront of regional carriers.

“Our objective is clear and focused: to be the most efficiently run and

sustainable airline in the region, to be the best in terms of on-time

performance and to constantly delight all our valued customers.”

Medera said being Caribbean means different things to different people.

“Many people say luck! Others say that to be Caribbean is to be easy

going, fun or warm; generous or wise, vibrant or respectful. Some would

say we are as different as we are alike.”

But he thinks being Caribbean is like a good cocktail, a perfect blend of

all these things, with a few magic ingredients added for good measure.

Medera pointed out that Caribbean people do not always appreciate

how special it is to be Caribbean, and sometimes take the energy of the

musical, the vibrancy of the culture, the beauty of the places and people

for granted.

“At Caribbean Airlines, we believe this is the right time to embrace and

celebrate our Caribbean identity. We are diving deep into the culture

and the spirit of our many diverse nations – bonded by a shared sea and

similar heritage – to bring out the best of the region."

Roughly a month ago CAL launched its latest corporation initiative, the

Caribbean Identity, through which it will showcase the authenticity of the

Caribbean region and all the elements that make it unique. This initiative

will be taken to Guyana and Jamaica and all of CAL's 20 destinations.

“This will be reflected across our whole airline identity, from our brand to

our community activities and our presence at festivals and major events in

the destinations we serve. We will build even further on our role as the

airline that brings the Caribbean together by enhancing connectivity

across the region and increasing the choices available to our customers.”

Medera said he plans to use new technology in running the airline. CAL

will implement a new Caribbean Airlines app, which puts booking,

managing and monitoring the journey on mobile devices.

The CEO said the airline also plans to acquire a brand-new fleet of Boeing

737 MAX 8 aircraft to replace its aging fleet. The first aircraft is expected at

Piarco before the end of the year.

“But through all the changes and new opportunities, what will remain the

same is who we are at the heart of Caribbean Airlines – a blend of all that

is best about our people and our region, the essence of the authentic

Caribbean, to share with you, our customers.”

CAL’s statistics show that the airline, while providing 1,053, 918 seats in

2018, carried only 937,368 passengers, with an on-time performance of 76

per cent. Its best month was August, when 92,124 passengers used its

services. Second-best performance was in July, with the figures being

86,452 passengers carried, with an on-time performance of 78 per cent.

For the first quarter of 2019 CAL will provide 243,668 seats, with the most

being in March when 84,460 seats will be available on the domestic

services.


Burma Quarry workers refuse to work overtime Thursday 7th March, 2019 – The Antigua Observer

Workers at the Burma Quarry have decided that enough is enough when

it comes to a matter affecting their pay packets.

As of yesterday – Wednesday 6th March 2019 – the quarry workers said

they will no longer work any overtime because of long outstanding pay

owed to them for the same.

“The issue is the lack or low overtime payment for the workers here,” shop

steward Michael Peters, told OBSERVER.

The quarrymen are reportedly owed overtime pay for over a year but

continued working in the expectation that the obligation would

eventually be honoured within a timely period by their employer – the

Government of Antigua and Barbuda.

“We used to work 17 hours a day, seven days a week,” said Peters.

Thus, as a form of protest, Peters declared that until they are paid they will

not be working past 3:00 p.m. – the end of their usual work day.

Peters questioned the current whereabouts of one million dollars that was

allegedly placed in the treasury to pay them.

According to him, the lack of overtime pay has had a domino effect on

the workers and their commitments. Their children have reportedly

suffered as a consequence because some are unable to pay school fees,

according to the shop steward.

In light of this action taken by the quarry workers, work has piled up. Peters

says evidence of this can be observed by the large heap of material left

at the quarry.

He said apart from the non-payment, workers are struggling with threats

by government to privatise the quarry.


Bank staff back on job – for now Thursday 7th March, 2019 – The Antigua Observer

Staff at Global Bank of Commerce have suspended industrial action

against the company following discussions by the bank’s management

with the Antigua and Barbuda Workers Union (ABWU).

At a press conference yesterday, the ABWU issued a letter indicating strike

action against the bank, stating it felt disrespected by the bank’s

representatives during negotiations.

Industrial Relations Officer for ABWU Fernando Samuels told reporters the

bank’s representatives were cruel, disingenuous, and negotiating in bad

faith.

“The union finds the bank’s action to be extremely disrespectful to not

only the employees and their representatives, who were ready to discuss

the longstanding matters, but also [disrespectful to] the office of the

Labour Commissioner. The union also views the behaviour of the bank to

be disingenuous and goes against the principle of good industrial relations

to the loyal staff who continue to work diligently,” he said.

According to the union, the bank failed to provide an update on issues

that were put on hold following initial talks which ended on April 30, 2018.

Prior to yesterday’s discussions, the bank’s representatives were expected

to meet with ABWU officials and the Labour Commissioner at the Labour

Department on Tuesday.

However, Global allegedly informed the Labour Department and the

union of its [the bank’s] unavailability 20 minutes AFTER the meeting was

scheduled to begin.

The union was supposed to meet with bank staff concerning their next

move after the press conference, but the bank’s call to the ABWU put that

meeting on hold.

On the discussion table for the two parties were, among other things,

issues relating to staff training, hours of work, overtime, maternity leave,

study leave and salaries.


Look for new DDM building job, contractors told Wednesday 6th March, 2019 – BVI News Online

The bidding process for construction of the new building for the

Department of Disaster Management (DDM) and the National Emergency

Operations Centre (NEOC) are projected to begin soon.

This is according to the Projects Unit of the Ministry of Finance in its monthly

progress report on how the $65 million rehabilitation and reconstruction

loan from the Caribbean Development Bank (CDB) is being spent.

“The tender document for the rehabilitation of the DDM building will be

launched shortly. Contractors, look out for the opportunity for the DDM

building works,” the Projects Unit said.

Another relatively major project to be funded through the loan is the

rehabilitative works that are to be done on the L-shaped building at the

hurricane-ravaged Elmore Stoutt High School campus in Road Town.

The project is farther along and is closer to entering the construction

phase when compared to the DDM/NEOC building project.

“The bid opening for the L-shaped building of the school took place on

January 30 and the tender process is in the final stage. The objective is to

start the works as soon as possible so that the building can be ready for

the upcoming school year,” the Unit said.

The Projects Unit is currently the agency in control of the loan funds for

these projects.

At the end of February, the sum that has been earmarked from the loan

so far amounted to a little more than $12.5 million.

Some $8,102,000 are set aside for some 18 consultancies and $4.5 million

was budgeted for the purchase of goods.


All gov’t ministers getting 3 months as Deputy Premier, Wheatley the first

appointee Wednesday 6th March, 2019 – BVI News Online

In what can be described as an unconventional move, Premier Andrew

Fahie is giving each of the ministers in his government an opportunity to

serve as Deputy Premier.

Minister of Education & Culture Dr Natalio Wheatley has been given the

first crack at the post.

Governor Augustus Jaspert appointed and swore in Dr Wheatley to the

post on Wednesday morning, March 6.

Each minister will sit in the post for three months.

“After the first year then someone will be named permanently to the post

of Deputy Premier,” Premier Fahie said while explaining the move. “It

allows for each minister to get the experience and also makes sure that

each minister also develops in areas that normally in most governments

might never have seen or had the opportunity to do.”

He continued: “Our government is one that’s inclusive and we intend to

build our people whether elected or not in the same manner so that we

can all be ready and equipped to take on the challenges of tomorrow.”


SuGEF relaxes bank reserves to boost credit Wednesday 6th March, 2019 – Qcostarica

The Superintendencia General de Entidades Financieras (SuGEF) –

General Superintendency of Financial Institutions – relaxed the rule that

requires financial institutions to create reserves to protect themselves in

case of deterioration of their loans.

The decision was made to “free” resources to financial institutions for the

placement of loans at a time when the economy is slowing, confirmed

Bernardo Alfaro, head of the SuGEF.

As of this year, the Superintendency reduced from 5% to 2.5% the

percentage of the projected annual profit that the banks must allocate to

the formation of the so-called “countercyclical” estimates, as detailed in

the official bulleting SGF-0077-2019 of January 19.

Each financial institution, based on its earnings projections, must save the

portion dictated by the SuGEF regulations.

This special reserve began to accumulate in 2016. At the end of 2018, it

amounted to ¢71.7 billion colones, according to the data of SuGEF.

The objective of this cyclical estimate is to accumulate resources, in times

of economic growth, and to protect financial institutions when credit

portfolios deteriorate.

Deceleration

Alfaro explained that the decision to reduce the percentage of

mandatory estimation was agreed after analysing the trend of the Índice

de Auges Económicos (Economic Booms Index).

This is an internal indicator of the SuGEF that measures the growth of credit

granted by financial entities with operations in the country.

“There is no acceleration in credit (…) the tool (the provision) is

countercyclical, and not pro-cyclical. If it continues, it would increase the

problem of low credit expansion,” stressed the Superintendent.

Data from the Banco Central (Central Bank) shows that the growth of

credit in the private sector stagnated as of November of last year.

The year-on-year change rate remained at 6% from November 2018 to

February 2019.

Alfaro said the SuGEF will conduct a review of the regulatory change in

June. At that time, it will be determined if the percentage of the

countercyclical reserve is further reduced, maintained or raised.

For María Isabel Cortés, executive director of the Costa Rican Banking

Association (ABC), the Costa Rican economy needs to be reactivated,

which is why the decision of the SuGEF was necessary.

Annabelle Ortega, executive director of the Cámara de Bancos

(Chamber of Banks), considered the SuGEF decision a positive one given

the current economic cycle.


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