• A new company has been awarded the rights to explore for oil and gas in the territorial waters of Barbados. Acting Prime Minister Santia Bradshaw announced on Monday (June 20) that her Government had approved Woodside Energy to take over the work started by global resources company, BHP Group (BHP) after the merger between BHP and the then Woodside Petroleum. 
• As far back as 2007, the then Government of Barbados formally launched the Barbados Offshore Petroleum Programme as part of its strategy to promote the island’s oil and gas potential and attract investment. Under this programme, Barbados subdivided its offshore acreage into 26 license blocks and developed a suite of legislation – the Barbados Offshore Petroleum Legislation – to govern all exploration, production, and development activities offshore. 
• The Ministry of Energy and Business aims to continue to license Barbados’ Offshore acreage under clear rules for developers and to increase the cultivation of data relating to the geological and geophysical conditions of the oil and gas sector. Owing to the importance of this sector in any economy, once fruitful, the country is expected to reap the benefits through increased employment, a new revenue income stream, foreign direct investment, and economic growth.

(Sources: Barbados Today & NCBCM Research)

• U.S. President Joe Biden on June 22, 2022, called on Congress to pass a three-month suspension of the federal gasoline tax to help combat record pump prices and provide temporary relief for American families this summer. The president also urged states to temporarily suspend state fuel taxes, which are often higher than federal rates, the official said. 
• He will also be challenging major oil companies to bring ideas on how to bring back idled refining capacity when they meet with his energy secretary on June 23, 2022. 
• Biden and his advisers have been discussing the issue for months amid increasing pressure to act as record-high gas prices weigh down the president's poll ratings and cast a dark cloud over Democrats' chances of retaining congressional power in November's elections. A suspension of the 18.4 cents per gallon federal gasoline tax and 24.4 cents diesel tax would require congressional approval, likely making Biden's pitch largely symbolic. 
• Lawmakers in both parties have expressed resistance to suspending the tax, with some Democrats, including House of Representatives Speaker Nancy Pelosi, worried the move could have a limited effect on prices if oil companies and retailers pocket much of the savings. Biden asked Congress to suspend the fuel tax through September, a move that will cost the Highway Trust Fund roughly $10Bn in foregone revenue but could be made up from other areas of a budget that will experience revenue growth in the coming months.

(Source: Reuters)

• Russia's consumer price index (CPI) fell 0.12% in the week to June 17, down for a third week in a row after a massive spike in March, providing the central bank with more room to cut rates to limit the economic downturn this year, data showed on June 22, 2022. So far this year, consumer prices in Russia rose 11.51%, data from the federal statistics service Rosstat showed. 
• Capped by a rapid recovery in the rouble and a drop in consumer demand, annual inflation has been slowing recently, and, in weekly terms, the CPI index declined 0.14% in the preceding week. Russia recorded its first weekly deflation in May for the first time since August 2021 after weekly inflation spiked to 2.22% in early March following the beginning of what Russia calls a "special military operation" in Ukraine on Feb. 24. 
• Inflation is slowing even after the central bank cut its key interest rate to the pre-crisis level of 9.5% earlier in June and kept the door open to further easing, noting uncertainty related to external risks such as the Western embargo on Russian oil. Prices on nearly everything, from vegetables and sugar to clothes and smartphones, have risen sharply since Feb. 24 as Russia encountered logistics disruptions and increased volatility in the rouble.

(Source: Reuters)

• The Bank of Jamaica Governor, Richard Byles, during the panel discussion on digital and cryptocurrency, at the 2022 Jamaica 60 Diaspora Conference on Wednesday (June 15) announced that persons with Central Bank Digital Currency (CBDC) accounts will be able to use them to receive remittances from overseas. 
• He also noted that while individuals sending funds would have to do so using existing arrangements at their respective locations when the money gets here “it can go through JAM-DEX immediately to the beneficiary”. Additionally, visitors to Jamaica who may wish to conduct transactions using CBDC will be accommodated. 
• It is anticipated that this will make the system of transfer even more seamless and immediate. Although there’s a bit of work to be done to get that to happen, the Governor noted that this is where technology and banking laws are eventually going to allow us to go. A more efficient process of remittance transfer should help to boost remittance inflows in the future. 
• The Bank of Jamaica (BOJ) is looking to commence the national rollout of JAM-DEX at the end of June. BOJ’s Director for Payment Systems and Policy, Mario Griffiths, said the Bank is proceeding with the sole qualified financial institution onboarded to issue digital wallets, which are required to access CBDC – National Commercial Bank (NCB). NCB offers JAM-DEX through Lynk, its digital wallet through which persons will be able to complete transactions with another Lynk wallet holder using JAM-DEX at a date to be advised by NCB. 

(Sources: JIS News & NCBCM Research)

• Potential investors/developers who decide to operate within the proposed Caymanas Special Economic Zone (SEZ) in St. Catherine will enjoy tax-free benefits for an extended period. This was disclosed by the Minister of Industry, Investment and Commerce, Senator the Hon. Aubyn Hill to global investor delegates/participants from the World Free Zones Organization’s Annual International Conference and Exhibition (AICE), 2022, being held in Montego Bay from June 13 to 17. 
• Several years ago the World Bank sponsored a feasibility study of this project and concluded that it will be suited for warehousing and logistics, ICT, BPO, robotics, artificial intelligence, furniture, paper products, plastics, repair services, pharmaceuticals, among other such activities. 
• The Government is looking to attract interest in the development of the 650-acre property as it seeks to get the Caymanas SEZ project started. Businesses operating within the zone will get 50 years tax-free benefit and land for lease. Prime Minister, the Most Hon. Andrew Holness, has mandated the Port Authority of Jamaica (PAJ) to get the project started. 
• Senator Hill further informed that the Government will be investing between $40Mn and $60Mn in the property to put in place the necessary utilities, including water and it will also have broadband access. Investors/developers who wish to develop the property will have a negotiated period within which it must be developed. 
• Special economic zones are expected to facilitate rapid economic growth in the country by leveraging tax incentives as a way of attracting foreign investments and technological advancement.

(Source: JIS News)

• The rising energy prices have prompted Antigua and Barbuda Prime Minister Gaston Browne to call out the United States’ trade embargo on Venezuela, saying that the sanctions on Venezuela are also hurting other nations in the Caribbean region. 
• Furthermore, in a bid to curb the rising price of oil, Browne called on the Caribbean Community (CARICOM) to talk to Caracas. Browne believes that the PetroCaribe initiative that Venezuela had since 2005 could be vital for the region to survive the soaring prices of oil. 
• The PetroCaribe energy initiative allows Venezuela to supply crude oil to countries in the Caribbean region at a much cheaper price relative to the current world price of oil in the first 90 days. Countries may pay the remaining price rate for 25 years, with an interest rate of 1% every year. The cost may also be offset through the trading of goods or services. 
• Loosening restrictions on Venezuela would benefit the region greatly by facilitating the trading of crude oil at a cheaper price and shoring up supply, which could help to alleviate the inflation pressures being faced by the Caribbean.

(Source: Caribbean News Now)

• The United Nations Conference on Trade and Development (UNCTAD) says investment flows to the Region reached US$134Bn last year, up from US$88Bn in 2020. 
• According to UNCTAD’s World Investment Report 2022, foreign direct investment (FDI) in Latin America and the Caribbean rebounded from the pandemic-induced slump, growing by 56% to US$134Bn, after plunging 45% in 2020 -- the sharpest decline recorded in developing regions that year. 
• The rebound in 2021 was propelled by a record number of 317 greenfield projects announced in information and communications technologies (ICT) sectors across the region, a 61% jump compared with 2020. 
• FDI to the Caribbean specifically increased by 39% to US$3.8Bn. This rebound was mainly driven by growth in investment flows to the Dominican Republic, the sub-region’s largest recipient of foreign investment, with the country recording a 21% rise in FDI to US$3.1Bn.

(Source: CARICOM TODAY)

• The recession that many Americans fear is coming is not “at all imminent,” Treasury Secretary Janet Yellen said on June 19^th, 2022. Talk of a recession has accelerated this year as inflation remains high and the Federal Reserve takes aggressive steps to counter it. 
• On June 15, 2022, the Fed announced a 75 basis point interest rate hike, its largest since 1994. Fed Chair Jerome Powell also indicated the Federal Open Market Committee’s intent to continue its aggressive path of monetary policy tightening in order to rein in inflation. At the same time, many expect the combination of resilience in consumer spending and job growth to keep the U.S. out of recession. 
• “I expect the economy to slow,” Yellen said, “It’s been growing at a very rapid rate, as the economy, and the labour market, have recovered and we have reached full employment. It’s natural now that we expect a transition to steady and stable growth, but I don’t think a recession is at all inevitable.” 
• Although Yellen seemed optimistic about avoiding recession, the global economy is still facing serious threats in the coming months with the continued war in Ukraine, soaring inflation, and the COVID-19 pandemic. 
• Still, she doesn’t believe a drop-off in consumer spending would be the cause of a recession. Yellen told ABC News that the U.S. labour market is the strongest of the post-war period and predicted that inflation would slow “in the months ahead.”

(Source: CNBC)

• The German government said Monday (June 20) that it remains committed to its goal of phasing out coal as a power source by 2030, despite deepening worries about a cut in Russia’s gas supplies. 
• Russia’s Gazprom announced last week that it was sharply reducing supplies through the Nord Stream 1 pipeline to Germany for what it said were technical reasons. The German government says the move appears to be politically motivated. 
• On Sunday (June 19), Economy Minister Robert Habeck said that Germany will try to compensate for the move by allowing increased burning of coal, a more polluting fossil fuel. Habeck, a member of the Green party, said the move was “bitter” but “simply necessary” to lower gas usage. 
• In the neighbouring Netherlands, the government announced Monday that despite Moscow’s reductions in gas deliveries to parts of Europe, it still plans to close the biggest Dutch natural gas field in 2023 or 2024, but will also allow coal-fired power stations to operate at full capacity again in order to conserve gas that would otherwise be burned to produce electricity. 
• The government had been phasing out the use of coal to generate power by allowing coal-fired power stations to operate only to a maximum of 35% of their capacity in recent years as it aims to transition to sustainable energy to cut greenhouse gas emissions. 
• When asked Monday to what extent the coal exit strategy is now in doubt, a spokesman for Habeck's ministry said that the coal exit in 2030 isn't wobbling at all, and it is more important than ever that it happens in 2030.

(Source: AP News)

• The Jamaican Government is moving to develop Jamaica as a planning supply hub for the local tourism sector and for other tourism-dependent nations in the region. Tourism Minister, Hon. Edmund Bartlett, made the disclosure as he closed the 2022/23 Sectoral debate in the House of Representatives on June 14. 
• The idea of the logistic supply hub for Jamaica and the other Caribbean islands came out of the Tourism Recovery Task Force chaired by Wilfred Baghaloo in 2020 and aims to give Jamaican entities the necessary muscles needed to grow locally, regionally and internationally. 
• As supply chain issues continue to present a challenge for many countries, it is believed that the hub will help to eliminate some of the supply chain uncertainties. The establishment of the supply logistics centre in the free zone is expected to enable the local suppliers to scale up and to be able to respond effectively. 
• This announcement came on the cusp of Jamaica welcoming the first million stop-over visitors for the year on Wednesday (June 15), bringing earnings of US$1.5Bn. Minister of Tourism, Hon. Edmund Bartlett, said that the strong arrival figure is a sign that the industry is on the “cusp of restoring its 2019 levels of arrivals and earnings”, following the disruptions caused by the pandemic. 
• He noted that summer bookings “are pacing ahead of 2019 (pre-pandemic), to be the strongest summer we have ever experienced”. In addition to this, tourism arrivals for 2023 are projected to reach 3.7 million and $3.5Bn in earnings, with 2024 expected to surpass 2019 levels with 4.2 million visitors and $4Bn in revenue. Considering these expectations, the supply hub would help to reduce potential challenges that the sector could face in sourcing goods to meet the rising demand.

(Source: JIS News & Ministry of Tourism)