Tracking Caribbean Economies


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Barbados financial system demonstrating resilience according to Central Bank report

BRIDGETOWN, Barbados, Monday March 9, 2015, CMC – The Central Bank of Barbados (CBB) says the island’s financial system continued to demonstrate resilience in spite of challenging economic conditions.

In its 2014 Financial Stability Report released here, the CBB said that over the course of the 12 months ending September 2014, most deposit-taking entities including banks, trust companies and finance houses as well as insurance firms faced low demand for major financial products by the private sector. “Consequently, growth was weak and in some instances, entities recorded a contraction on their balance sheets,” the CBB said, noting that for the banks, loan growth was driven by one particular loan to Government, as well as mortgage lending in the personal sector

Read more: Barbados financial system demonstrating resilience according to Central Bank report | Caribbean360

Central Bank of Barbados


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Jamaica 'open for business', says IMF rep

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Cuba's New Laws Will Be More Friendly To Foreign Investors

By Marc Davis

Investors worldwide, ever alert for opportunities, are now eyeing Cuba as the next emerging market with significant growth and profit potential. Cuba's agricultural sector, including forestry, cattle ranching and the dairy industry, are among the areas expected to receive infusions of foreign investment capital.

New Cuban legislation, now pending its anticipated approval in March, will open the nation's inefficient state-managed economy to foreign investments without its current restrictions.

Cuba's current law regulating foreign investment was passed in 2014, but experts say the law is inadequate and imposes too many limitations.

Among the old government rules expected to be eliminated is the requirement of all foreign funded enterprises to employ only domestic personnel and that they be paid in hard currency.

Foreign Companies Do Invest In Cuba

Despite these restrictions, "Foreign companies can and do invest in Cuba," said Raul J. Valdes-Fauli.

Valdes-Fauli is an attorney of Cuban descent based in Miami, former mayor of Coral Gables, Fl., and has extensive experience in taxation, banking and corporate matters both domestically and in Latin America.

"A Spanish company has a chain of hotels," he said. "There's a French fishing company. The Brits are there. The Israeli's have one of the biggest citrus companies. It's only the United States that doesn't invest in Cuba."

The only legal obstacle to U.S. investment in Cuba is the U.S.Helms-Burton Act of 1996, said Valdes-Fauli. The Helms-Burton Act is an American federal law that extended and ramped up the embargo against Cuba first imposed in 1960.

No Embargo On U.S. Sales of Food and Medicine to Cuba

Exempted from the embargo, is the U.S. sale of food and medicine to Cuba for humanitarian purposes. Sales of other U.S. products or services are still illegal under Helms-Burton.

But the Helms-Burton law may be repealed if relations between the U.S. and Cuba continue in its current warming trend. If the embargo is eventually lifted, as many analysts expect, the U.S. will be able to sell the full spectrum of goods and services to the Cuban market

And when the new Cuban legislation takes effect, U.S. companies and investors can invest in the Cuban economy, now undergoing profound changes.

After more than fifty years under an economy patterned on the failed Soviet model, Cuba's economy is moving in a different direction. Foreign investment "would [when the new law is passed] occupy a major role," said Pedro San Jorge, head of the economic policy office of the country's Ministry of Foreign Trade and Foreign Investment in an official policy statement to Cuban media. San Jorge's comments reflect the new Cuban
interest in growing its economy through foreign investment.

Cuban Economy Evolves Along Chinese Lines

"Since the fall of the Soviet Union [a Cuban ally and trading partner] Cuba's economy has been evolving along Chinese lines," said Santiago Fittipaldi.

Fittipaldi is a managing director of Burson-Marsteller, Miami and director of its Public Affairs practice; a former journalist covering Latin American business and finance; author of Developing Business Strategies for Cuba; and a frequent visitor to Cuba.

China has moved step by step from a managed economy to a free market economy, but with certain government restrictions – based on Communist-era regulations -- still in place. Cuba has begun a similar transition, which is still in its earliest stages.

"There are already some elements of a freer economy," said Fittipaldi. "Small businesses are permitted, the tourism sector has grown, and partnerships are permitted between Cuban and foreign investors."

Under a re-engineered Cuban economy ready for what some analysts see as exponential growth, Cuba will attract capital, said President Raul Castro, according to a report in a government-controlled weekly newspaper.

The result will be more jobs, an increase in production and profits across many economic sectors, and a reduction of Cuba's reliance on imported goods, said Castro.

In another significant move away from a Soviet communist economy, the Cuban dual currency system will also be gradually abolished.

Under Cuba's two currency system a majority of workers are paid in the Cuban peso (CUC), valued at about four cents. Domestic purchases, however, must be made in the hard currency convertible peso (CUP), pegged to the U.S. dollar. Foreign governments and enterprises do not accept either currency for payment.

Cuba's Major Foreign Buyers

Cuba's major foreign buyers of its agricultural products include Brazil, Canada, China, Europe, and Vietnam. Cuba's main agricultural crops include sugar, tobacco, coffee, cocoa, cotton, rice, potato, bananas, avocado, cassava and a variety of other tropical fruits.

"Even if the Cuban economy lifts its restrictions on foreign investment, there's likely not to be a lot of new [foreign] players," said Fittipaldo. "Cuba will be tweaking what they already have to be more in line with its competitors. Current players will probably increase their [stakes] in Cuban [enterprises].

Cuba's agricultural sector could benefit significantly from an infusion of foreign cash.

Agriculture contributes about 10 percent to Cuba's GDP, according to a report prepared by the Center for Democracy in the Americas and others.*

Some 30 percent of the land is now devoted to agriculture.* But acreage devoted to agriculture could increase as demand and profits heat up, thus making previously unproductive sections of the island new revenue sources. Employment in the agricultural sector*, currently at about 20 percent of the labor force, could increase, expanding consumer buying power if profits increase with more efficient farming and if wages rise in accord with rising profitability.

U.S. Embargo Hasn't Worked

"More than fifty years of the U.S. embargo on Cuba hasn't worked," said Valdes-Fauli. "The Obama administration wants to try something different."

Read More Cuba's New Laws Will Be More Friendly To Foreign Investors - Global AgInvesting


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Haiti is back on the map of banana exporting countries

coming months, the first containers of bananas Agritrans project will leave for Europe. A first since 1955. Year in which Haiti has exported this product for the last time. With this project, the country is not only back on the global map of banana exporting countries, but also hopes to find its place in a market dominated by giant India the world's largest producer of bananas to China and the Philippines.

The Agritrans project, first agricultural free trade area of ​​the country is 2 million seedlings that will soon be planted on a thousand hectares with an annual production of 60 000 tonnes. According to the law on free zones, 70% of this production will be exported as against 30% for the local market.

With 17 million tonnes of bananas in circulation - for a total production of 130 million tonnes, mainly consumed locally - international exhibitions of bananas in 2014, according to FAO data, about $ 7 billion per year.

For Jovenel Moses Agritrans responsible for the project, the banana is a mine, a source that never runs dry. It is harvested throughout the year. Now this is very popular around the world, do not leave the country for 60 years. Meanwhile, other countries in the region are engaged in this culture and profit handsomely from the mass of their currency it reports annually.

This is the case, among others, the Dominican Republic, where, according to data from the central bank, banana exports reached between 2011 and 2013, 69% of total exports of fruits. Making it one of the largest exporters of organic bananas in the region.

Jamaica also, according to the Journal of the Caribbean, has high hopes for the banana industry. Indeed, the Minister of Agriculture, Derrick Kellier, announced to the press that his country will embark on banana production, with an initial target of 381 hectares of land.

Never mind! Jovenel Moses everything feels completely equipped to deal with regional competition. "The project is supported by 1,000 acres of Agritrans, the North has an area of ​​65 000 hectares [...] In terms of arable land, we have nothing to envy to other producers in the level of the Caribbean" said one who admits that he intended to go tickle the Dominican Republic we import almost all the bananas we eat.

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Inflation decreases to 6% in T&T

Inflation decreases to 6% | Trinidad Express Newspaper | Business

Headline inflation slowed for the third consecutive month in February to just over six per cent from nine per cent in November 2014, the Central Bank said yesterday. “The slowdown in food inflation, as a result of higher food supply and favourable weather conditions, contributed to the deceleration in headline inflation. This easing in headline inflation may be short lived, as inflationary pressures are expected to pick up in the rest of 2015 due to a number of factors,” the Bank stated in its latest Monetary Policy announcement.


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Caribbean must unite, says former Jamaican PM

By Glenis A. Rose

MONTEGO BAY, Jamaica (JIS) -- Former prime minister of Jamaica, P.J. Patterson, says the region must unite in order to achieve economic prosperity and effectively address issues such as food insecurity, natural disasters and health challenges.

“We, who were called upon to serve at varying times in political leadership, must avoid the insular approach, which impels us to fight against each other, rather than pool our collective resources for mutual economic growth and shared prosperity,” he said

Read More; Caribbean must unite, says former Jamaican PM | Caribbean News Now


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IMF says Bahamas faces challenge to further economic recovery

NASSAU, Bahamas, Tuesday July 28, 2015 – The International Monetary Fund (IMF) says while the Bahamas economy is recovering, the outlook remains challenging. And even with the United States’ recovery and the opening of the Baha Mar mega resort, growth is expected to remain below pre-global crisis levels.

Against this backdrop, the Washington-based financial institution has called for structural reforms to strengthen competitiveness, raise potential growth, and lower unemployment; and for continued efforts to strengthen the fiscal position.

The advice was contained in the IMF Board’s full report, released yesterday, following the Article IV consultation with the Bahamas last month.

Real gross domestic product (GDP) expanded by an estimated one per cent in 2014 on the back of increased tourist arrivals. Potential GDP growth is estimated at about 1.5 per cent over the medium term, which the IMF said was insufficient to generate a significant reduction in the high unemployment rate.

“Absent structural reforms, including in the labour market and the energy sector, significantly higher growth than currently projected will be required to absorb new entrants to the labour force and reduce the unemployment rate to single digits over the medium term,” it said.

“The full opening of Baha Mar and two smaller projects, together with the strengthening US economy could represent a major boost to exports in the near-term,” the IMF added, although stressing that, beyond 2016, growth would taper off as US growth decelerates and the base effects from the opening of Baha Mar fade.

The IMF directors therefore underscored the importance of finalizing and implementing the National Development Programme to accelerate medium-to-long-term economic and social development.

The Fund said that over the medium term, enhancing the efficiency of labour market regulations and institutions and greater investment in human capital would be essential to increasing productivity and competitiveness.

It also stressed the importance of stepping up reforms of the state-owned enterprises, in particular in the energy sector.

As they commended the authorities for the substantial progress on fiscal consolidation, and successful introduction of the VAT, the IMF directors urged government to steadfastly implement the planned fiscal consolidation in order to rebuild buffers and place public debt on a declining path.

“In this regard, they stressed the need for continued revenue reforms, including strengthening tax administration. They also recommended rationalization of current expenditures in the context of a medium-term budget framework,” the directors stated in a press release.

They also agreed that the exchange rate peg has continued to serve the Bahamas well. To support it going forward, they stressed the importance of structural reforms to improve competitiveness, noting that this would also avoid placing an excessive burden on fiscal policy.

Read more: IMF says Bahamas faces challenge to further economic recovery | Caribbean360



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“The full opening of Baha Mar and two smaller projects, together with the strengthening US economy could represent a major boost to exports in the near-term,”

How does Baha Mar help exports???


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Bahamas and Barbados have some good economic policies that made them impervious to the drawbacks of the recession.


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New T&T Govt faces tough economic times ahead*

THE new Government takes office at a time when the national economy faces formidable challenges, as Prime Minister Dr Keith Rowley repeatedly emphasised during the closing weeks of the election campaign and in his victory speech on the night his party won.

It took a lot of courage for Dr Rowley to alert his supporters and other voters he wooed on the campaign trail to “rough waters and rapids” ahead, knowing that even a hint of sacrifices could have turned away voters who craved “milk and honey”.
We do not envisage the Government having to impose IMF-style harsh austerity measures, since the country’s macroeconomic fundamentals are not woefully bad.

True, the latest Central Bank data point to a decline in GDP of 1.2 per cent for the second quarter of fiscal 2014-2015, and we can expect a similar trend to continue for at least another year.

Trinidad Express Newspapers: Features | New Govt faces tough economic times ahead*



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Internet exchange points critical to Caribbean digital economy

Caribbean nations need to strengthen their Internet infrastructure if the region is to take full advantage of the global digital economy.

That was the view expressed by Caribbean Telecommunications Union (CTU) vice president Mark Vanterpool, at the official launch of CTU’s ICT Week in Tortola, British Virgin Islands (BVI).

Vanterpool, the Minister for Communications and Works in the BVI, used his country as an example of the benefits of investing in Internet infrastructure. He singled out the role of the local Internet exchange points, commonly called IXPs, as one of the key enablers of the Caribbean digital economy.

Read more: Internet exchange points critical to Caribbean digital economy | Caribbean360


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The first Haitian bananas have arrived in Europe

The cargo of 100 tons of organic bananas Haitian (about 8,000 bunches) from the AGRITRANS company, loaded on the Crown Garnet September 8 in Cap Haitien is arrived at the dock 212 of the Port of Antwerp International (Belgium).

On this occasion were present Dr. Frantz Bataille, Charge d'Affaires in Berlin and Dominique Dejean, Minister Counsellor of the Embassy of Haiti in Germany, Huguette Herard von Raussendorf, Charge d'Affaires in Brussels, Felio Joseph Adviser and Georges Duroseau First Secretary at the Embassy of Haiti in Belgium.

The first banana crates scrolling on a conveyor have been a moment of pride and emotion punctuated with applause by the delegations present, as well as the CEO of the International Port and its quality control manager. Diplomatic staff observed quality control techniques, carried out by the staff of the Port on the Haitian cargo of bananas.

After unloading bananas and control the various diplomatic actors and the direction of the Port of Antwerp have made a toast to celebrate the return of Haiti bananas on the international market, after 60 years.

Haiti - Economy : The first Haitian bananas have arrived in Europe - : Haiti news 7/7



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30,000 cruise ship visitors expected to POS, Trinidad

THE Tourism Development Company (TDC) is expecting sixteen cruise ships carrying 30,000 visitors to dock in Port of Spain when the 2015/2016 cruise ship season starts in November.

The visitor numbers represent a 56 per cent increase in cruise passenger arrivals, when compared to the same period last year, according to the TDC, which issued a statement on Tuesday.

The TDC said: “Some of the world’s most luxurious cruise ships have added Trinidad and Tobago to their itineraries for the upcoming season including the MSC Orchestra, with a capacity of over 2,000 passengers and the intimate yet sumptuous World Odyssey and Voyager ships. Also making a return to Trinidad and Tobago’s waters are the Saga Sapphire and Seven Ocean Princess”.

According to the TDC, the increasing popularity of Trinidad and Tobago as a port-of-call comes as the Caribbean Tourism Organisation reported 104 per cent growth in cruise tourism arrivals for the twin island nation between 2014 and 2015, the largest rate of growth reported for any destination.

“As the amount of visiting ships grow in number, so too are the variety of on-shore activities and tours available for cruise passengers, both in and beyond the city of Port of Spain. Shore side activities are as much a part of the cruise experience as enjoying the onboard services of the cruise ship and visitors to the islands can explore through the eyes of a local the City Tour, bask in the beauty of the lush northern mountain range en route to Maracas Beach or witness the spectacular sight of Scarlet Ibis at the Caroni Swamp and Bird Sanctuary”

The TDC said it will be deploying Visitor Guides in and around the Port of Port of Spain to assist passengers, with local tourism ambassadors and visitor guides strategically positioned at the cruise ship terminal and in the streets of the capital city to assist passengers with maps and information on local points of interest.

Trinidad Express Newspapers: Business | 30,000 cruise ship visitors expected


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Less growth for Jamaica — IMF

But rates still beat LAC average

The International Monetary Fund (IMF) revised downward its growth projection for Jamaica up to 2016, according to the World Economic Outlook (WEO) released this week.

The IMF noted in its quarterly World Economic Outlook (WEO) that the island should grow at 1.1 per cent in 2015 down from 1.7 per cent projected in the previous report. The island should also grow at 2.1 per cent in 2016 down from 2.2 per cent in the previous report.

Despite the downward revision, the island actually beat the regional average growth for Latin America and the Caribbean region (LAC), according to fresh data from the island's multilateral lender, the International Monetary Fund (IMF).

It is rare, at least in recent years, for the island to beat the region. Commodity prices led by energy and grains are no longer supporting the growth in Brazil, Venezula, Argentina and Mexico. As a result their growth is weak, but it also allows commodity importers like Jamaica a chance to grow.

The LAC regiion is set to grow at negative 0.3 per cent and 0.8 per cent in 2015 and 2016 respectively.

Panama will continue growing at the fastest pace in the Americas at 6.0 per cent and 6.3 per cent in 2015 and 2016 respectively.

Meanwhile, oil-rich Venezuela should decline by 10.0 per cent and 6.0 per cent in 2015 and 2016, the worst in the region.

Jamaica will edge out oil-rich Trinidad & Tobago, set to grow at 1.0 per cent and 1.4 per cent in 2015 and 2016, respectively.

But the Dominican Republic should grow at the fastest pace in the Caribbean at 5.5 and 4.5 per cent over the review period.

The WEO acknowledged that Caribbean countries are running one of the largest deficits due in part to their oil dependence.

"It suggests that these countries do run larger deficits than others, after their size and level of development are controlled for. The intensity of their oil dependence is clearly a factor explaining their deficits," stated the report.

In the previous WEO it highlighted that government deficits would come under greater pressure, were the PetroCaribe concessionary oil agreement between Venezuela and the Caribbean to end.

The previous WEO also warned against governments stimulating Caribbean economies in an effort to spur growth. It indicated that "misguided efforts to address the current slowdown" with excessive policy stimulus, rather than by tackling supply-side bottlenecks and competitiveness problems, could also undermine countries' hard-won macroeconomic stability.

Jamaica signed a US$932.3-million four-year Extended Fund Facility (EFF) agreement with the IMF. The programme calls for the reduction of Jamaica's debt from some 145 per cent of gross domestic product (GDP) to 96 per cent by 2020. It also includes achieving a 7.5 per cent primary budgetary surplus target; implementation of a National Debt Exchange programme; currency depreciation; tax reform; and public sector reform -- restructuring of salaries to reduce ratio to GDP from 10.6 per cent to nine per cent by 2015/16.

Less growth for Jamaica — IMF - Business -