• Building tourism resilience is critical to ensuring the sector’s sustainability and its contribution to economies, says Tourism Minister, Hon. Edmund Bartlett.
• Chairing the Fifth Special Meeting of the Inter-American Committee on Tourism (CITUR), Mr. Bartlett warned that despite tourism being one of the most significant contributors to global output, providing jobs, incomes and livelihoods for millions of people, the sector remains susceptible to external shocks and crises. These include natural disasters, economic downturns, and pandemics.
• “As the sector continues its recovery, it is important that we acknowledge the importance of putting people first, investing in people and developing the right skills as crucial elements of building tourism resilience over time. It is essential to train and educate the workforce to be adaptable to changing circumstances such as new technologies and evolving customer preferences,” he said.
• It is also important that tourism also prioritises the creation of a workforce that reflects the communities it serves to deliver both an enhanced product, as well as to accrue more benefits to a broader range of stakeholders in the tourism value chain.
• He emphasised that a resilient tourism product must operate in a way that protects the environment and supports local communities, including small and medium-sized tourism enterprises, while at the same time ensuring economic viability.
• “As a region, we have to position ourselves to take advantage of emerging technologies and to better use the available science and data to inform decision-making, particularly in relation to building tourism resilience,” Mr. Bartlett added.
• Tourism accounts for about 34% of the economic output in Jamaica and 31% of employment in Jamaica. Tourism’s contribution to GDP and employment is much higher for some Caribbean neighbours and as such it is imperative that the region not only grow the product but also ensures that growth takes into consideration the economic, social and environmental issues as well. 

(Source: JIS)

• Fitch forecasts that the Dominican Republic’s real GDP growth will slow from 4.9% in 2022 to 3.5% in 2023, primarily due to a weakening US economy in H223.
• Preliminary 2022 growth statistics were strong, coming in just below Fitch’s estimate of 5.0%, as resilient US demand for DR’s goods and tourism underpinned strong overall export growth (13.7%) and domestic employment, which sustained private consumption growth (3.3%). However, DR incomes and savings were likely diminished by a 5.2% contraction in remittance inflows in 2022 (the first recorded contraction in the data going back to 2010).
• The projected slowdown in the US will pose major headwinds to DR’s export and investment growth, which by extension will affect private consumption growth.
• Since the start of 2023, fading base effects and easing private demand have led to weak growth. Headline inflation remains elevated at 5.9% y-o-y, which suggests that households’ real incomes were muted, feeding into weaker demand.
• Owing to these factors, Fitch’s core view is that the Dominican Republic’s economy, like many other Caribbean markets, will be undercut by a mild recession in the US in H223, with growth slowing in the same period. Nonetheless, economic activity will pick up slightly as peak tourism season will support income growth.

(Source: Fitch Solutions)

• The Barbados government says it will open a new office in Panama City, Panama, as it moves to further deepen its relationship with Latin America (LATAM).
• The Tourism and International Transport Minister, Ian Gooding-Edghill, expects this to aid Barbados in continuing to strengthen the relationship and marketing efforts in the region and further demonstrate the confidence in this market for the growth of the tourism industry.
• He said with the return of the Copa Airlines flight connecting Barbados to LATAM countries, the destination has facilitated the arrivals of thousands of travellers, including those looking to enjoy the destination under Barbados' 12-month Welcome-Stamp visa.
• Latin America is poised to be an important market for the growth of the tourism industry and trade relations with different partners in the region.
• Barbados has continued to see an increase in arrivals from Brazilian and Latin American travellers and is looking to continue its growth by welcoming more visitors through direct services via Copa Airlines.
• Barbados is heavily reliant on tourism for economic growth and job creation, this new extension will see the country benefiting from greater inflows which would drive up growth and help to put the country back to pre-pandemic levels.

(Source: CariCris)

• According to executives at the biggest U.S. banks, consumers are starting to fall behind on their credit card and loan payments as the economy softens, although they said delinquency levels were still modest.
• Profits at Bank of America Corp, JPMorgan Chase & Co, Wells Fargo & Co and Citigroup Inc. beat analyst forecasts as lending giants earned a windfall from rising interest rates. However, industry chiefs warned that the strength would tail off this year as a recession looms and customer delinquencies climb.
• "We've seen some consumer financial health trends gradually weakening from a year ago," Wells Fargo Chief Financial Officer Mike Santomassimo said on a conference call Friday to discuss its first quarter results.
• Citigroup made larger provisions for credit losses even as it brought in more revenue from clients' interest payments on credit cards. Delinquency rates were rising as anticipated, but still stood below normal levels in the bank's "very high quality" loan portfolio, said Mark Mason, the bank's finance chief.
• "We have tightened credit standards specifically as a result of the current market environment in cards, we continue to calibrate our credit underwriting based on what we're seeing based on macroeconomic trends," Mason said.

(Source: Reuters)

• For March 2023, the All-Jamaica Consumer Price Index (CPI) increased by 0.1 per cent. The point-to-point inflation rate (March 2022-March 2023) has, however, fallen further to 6.2 per cent. Notably, the figure represents the lowest point-to-point inflation figure since August 2021 (6.1%). This current inflation figure is just outside the Bank of Jamaica’s (BOJ) target range of 4.0 to 6.0 per cent.
• The 0.1 per cent increase in the monthly inflation was largely influenced by the 0.8 per cent increase in the index for the ‘Food and Non-Alcoholic Beverages’ division as prices continued to increase within the class ‘Vegetables, tubers, plantains, cooking bananas and pulses’. This was attributed mainly to lower supplies of some agricultural produce resulting from dry weather conditions.
• The rise in the CPI was also influenced by the 1.1 per cent increase in the index for the division ‘Restaurants and Accommodation Services’ resulting from higher prices for meals consumed away from home.
• The inflation rate was, however, tempered by a 1.8 per cent fall in the index for the ‘Housing, Water, Electricity, Gas and Other Fuels’ division and a 0.2 per cent decline in that of the ‘Transport’ division.
• On May 19, 2023, the BOJ will host its monetary policy meeting and we anticipate that the bank will continue holding the policy interest rateat 7% as it continues to watch the pass-through effects of previous rate hikes.

(Source: STATIN)

• Knutsford Express Services Limited (KEX) Limited recorded a net profit of $68.3Mn for the third quarter that ended February 28, 2023. This represents a 75.9% increase in profitability when compared to the $38.8Mn recorded over a similar period in 2022.
• Given the Q3 results, coupled with the strong performance in the first half of the financial year, net profit totalled $211.4Mn for the nine months ended February 2023, up 304.5% (or $159.1Mn) year-over-year.
• Revenue for the quarter was up by 55.3% y-o-y to $467.9Mn. Similarly, the YTD showed a 65.4% (or $506.5Mn) increase in company revenues to $1.3Bn. This was driven by reduced mobility restrictions, increased local and international travel, as well as its strategic efforts to diversify its revenue streams as seen by the significant investments made towards its courier and rental services.
• However, administrative and general expenses were 41.4% (or $293.8Mn) higher in the nine months relative to the same period last year. Despite higher expenses, operating profit grew by 325.7% (or $212.7Mn) as strong revenue growth outpaced increased costs which translated into a 13.3 percentage point (pp) increase in the operating margin to 21.7% in 2023.
• Going forward, as tourism continues to rebound and as the company continues to expand its courier and rental services, it is expected to generate additional diversified revenue, making it more resilient to downturns in the economy thereby aiding long-term growth.
• KEX’s stock price has increased by 32.4% since the start of the calendar year. The stock closed Monday’s trading session at $11.74 and currently trades at a P/E of 21.3x which is above the Junior Market Others Average of 21.1x. This higher P/E ratio is likely reflective of its expected growth trajectory.

(Sources: JSE & NCBCM Research)

• Brazil's Planning Ministry announced on Friday, April 14, a zero primary deficit target for 2024; but stated that 172 billion reais (US$35.03Bn) in government spending depends on the approval of a proposed new fiscal framework.
• The new fiscal rules aim to balance limits on spending growth with the government's vow to boost social programmes and public investment. The rules would allow public spending to grow between 0.6% and 2.5% per year above inflation and limit spending growth to 70% of revenue growth in the prior 12 months.
• In a statement about the 2024 budget bill sent to Congress, the ministry said the new fiscal rules "will enable the re-composition and execution of priority public policies for the country," as well as government functioning.
• The much-awaited framework, presented by the government of President Luiz Inacio Lula da Silva in late March, is expected to be sent to Congress this week. It has alleviated concerns over the uncontrolled growth of public debt under the administration, resulting in a boost in local markets and a strengthening of the real currency against the U.S. dollar.
• As it awaits congressional approval, the government has crafted a budget proposal that adheres to the still-effective spending cap, which has limited expenditure growth to the previous year's inflation since 2017 but has been breached multiple times.
• Lula's new rules combine a more lenient expenditure cap with primary budget targets with flexible bands. In line with this approach, the budget bill has defined that the primary budget balance target may vary by 28.8 billion reais up or down next year.

(Source: Reuters)

• Peru's gross domestic product (GDP) shrunk 0.63% in February compared with the same month last year, the government's National Institute of Statistics and Information (INEI) statistics agency said on Saturday, April 15, beating expectations for a 0.90% decline in the GDP by analysts who forecast a bigger decline.
• It was a second successive month of decline after the economy began to contract in January following 22 months of growth, hurt by nationwide anti-government protests. Peru's finance ministry is confident that growth should return soon.
• Economic activity in February was hit by "continuity of social conflicts, which resulted in work stoppages, road blockades, market closures, among other issues, which occurred in some areas of the country," INEI said in a statement.
• Economic activity in the world's number 2 copper producer was dented by a decline in several sectors, including construction, telecommunications, as well as finance and insurance.
• Peru's finance ministry said in a statement on Saturday that it expects "the economy to register positive rates again as of March, in line with the behaviour of the leading indicators of economic activity", helped by a decline in social unrest.

(Source: Reuters)

• Major central banks may be deep into their drive to raise interest rates in hopes of killing inflation, but the endgame remains far from clear as price increases prove harder to slow than expected, and analysts caution that financial markets could still break along the way.
• The U.S. Federal Reserve, the European Central Bank and the Bank of England are all still raising rates, and policymakers are open about the massive uncertainty surrounding their projections and the risk they may have to do more than expected.
• However, it is felt that all are closing in on a peak interest rate for this round of monetary policy tightening while holding fast to projections that inflation will slow steadily over the next year or two without a major blow to economic activity.
• That view has received a sceptical response from top global policymakers and analysts who see a world where persistent shortages of labour, cleavages in global supply, and wobbly financial markets may force a choice between higher and longer-lasting inflation, or a deep recession to fix it.
• The prospect of inflation falling alongside a gradual return to the pre-pandemic state of affairs is implicit in how central banks are framing the path forward. Among the Fed, ECB and BoE, only the British central bank projects a recession will be needed to slow inflation - only a mild one at that. The ECB expects to win its inflation battle with no change in the unemployment rate. The U.S. central bank officials have split the difference, projecting a modest one-percentage-point rise in the unemployment rate this year from its near-historic low of 3.5%, and slow, but continued, economic growth.
• Against that outlook, Fed policymakers last month indicated that one more quarter-percentage-point rate increase at their May 2-3 meeting, which would raise the policy rate to the 5.00%-5.25% range, could be the last of this tightening cycle.

(Source: Reuters)

• Wall Street's main indices showed little change on Monday as investors awaited more bank earnings and views from Federal Reserve policymakers that could provide cues on when the central bank will pause its monetary tightening.
• Wall Street closed lower on Friday after mixed economic data appeared to affirm another Fed rate hike in May, dampening investor enthusiasm after a series of big U.S. bank earnings launched the first-quarter reporting season.
• While banking heavyweights including JP Morgan Chase & Co windfalls from higher interest payments, the focus will be on smaller banks that were at the centre of last month's banking turmoil and forecasts from companies amid recession worries.
• Other major U.S. banks including Goldman Sachs Group Inc, Bank of America Corp and Morgan Stanley will report through the week. "Regional bank earnings will come in slightly positive, while bigger banks will probably post surprisingly positive results," said Sam Stovall, chief investment strategist at CFRA Research.
• Analysts expect profits at S&P 500 companies to have declined 4.8% in the first quarter of 2023 from the year-earlier period, according to Refinitiv data, a slight improvement from last week’s forecast of a 5.2% decline.
• “Inflation fire has really been put out, but we’re going to continue to pour water over it until we feel confident that it is so,” Stovall said, adding that people were bracing for a deep recession that just might not come.

(Source: Reuters)