Barbados and the region continue to face the chilling reality that in 20 years, a substantial portion of tourism revenues will be funding the cost of addressing the impact of climate change.
This concern was raised by Barbados’ Ambassador Extraordinary and Plenipotentiary with Responsibility for Climate Change, Small Island Developing States and Law of the Sea, Senator Elizabeth Thompson, who said that the Caribbean tourism sector earns $24Bn annually, contributing between 17 to 90% to GDP, and providing 40% of the jobs in the market.
The Inter-American Development Bank (IDB) is projecting that by 2050 the cost of addressing climate impacts for tourism will amount to US$22Mn.
Senator Thompson explains that the only way to change that equation is by building resilience. The reality is that tourism revenues are so integrated into the economy, with direct and indirect jobs, the region has to build resilience beyond the tourism sector.
Building resilience in the sector involves finding ways to guard against the ravages of climate change, protecting coastlines and coral reefs, committing to and operationalising the transition to renewable energy resources, boosting agricultural output with technology for food security, and addressing the water scarcity issues, among other measures.
Until then, the current challenge is for Barbados to position itself as an all-year balanced tourism destination to drive sustainability by focusing on initiatives including educating tourists on single-use plastic, food waste, carbon offsetting etc., which results in inclusive growth and economic impact.
On June 28, 2022, the United States, imposed sanctions on more than 100 targets and banned new imports of Russian gold, acting on commitments made by the Group of Seven leaders this week to further punish Russia over its invasion of Ukraine.
The U.S. Treasury Department said it imposed sanctions on 70 entities, many of which it said are critical to Russia's defense industrial base, as well as 29 people in an effort to hinder Russia's ability to develop and deploy weapons and technology.
"Targeting Russia's defense industry will degrade Putin's capabilities and further impede his war against Ukraine, which has already been plagued by poor morale, broken supply chains, and logistical failures," Treasury Secretary Janet Yellen said in a statement.
Fresh sanctions were imposed on Rostec, Russia's state aerospace and defense conglomerate. The Treasury said Rostec's "management umbrella includes more than 800 entities across a wide range of sectors" and that all entities owned 50% or more, directly or indirectly, by Rostec are blocked. United Aircraft Corporation (UAC) was sanctioned to "weaken Russia's ability to continue its aerial assault on Ukraine," the Treasury said.
The United States slapped sanctions on Russia's largest truck manufacturer, Kamaz (KMAZ.MM), saying its vehicles have been seen carrying missiles and Russian soldiers throughout the Ukraine conflict.
NATO formalized its invitation to Sweden and Finland to join its alliance on June 29, a historic expansion of the defense bloc that directly undercuts Russian President Vladimir Putin's aims as his war in Ukraine grinds ahead.
The group collectively decided to approve countries' applications to join after Turkey dropped its objections, paving the way for NATO's most consequential enlargement in decades.
"The accession of Finland and Sweden will make them safer, NATO stronger, and the Euro-Atlantic area more secure. The security of Finland and Sweden is of direct importance to the Alliance, including during the accession process," the statement said.
The decision will now go to the 30 member states' parliaments and legislatures for final ratification. NATO's leaders said they expected the process to move quickly, allowing for an unprecedentedly swift accession and a show of unity against Putin.
Real estate investors are being urged to diversify into other industries, in order to create the levels of economic expansion that will support continued growth in the sector.
The advice comes from State Minister in the Ministry of Industry, Investment and Commerce, Dr. the Hon. Norman Dunn, who pointed out that such investment would create wealth for Jamaicans, who could then put their money into real estate.
“What good are new houses, apartments, offices and factories if we do not build other industries at the same time, so that people have the financial resources to acquire real estate?” he asked, while addressing the Annual General Meeting of the Realtors Association of Jamaica (RAJ) at the Terra Nova Hotel All-Suite Hotel in St. Andrew on June 22.
He noted that while “investment from foreign direct investors can support this process, there is also a place for Jamaicans to commit to nation-building by actively engaging in direct investments to different industries”.
There are also opportunities in areas such as agro-processing, light manufacturing, and in finalising goods for export. Therefore, domestic private sector investments in these areas can ensure growth to sustain the current expansion being witnessed in the real estate industry.
Barbados may be returning to the International Monetary Fund (IMF) to ask for assistance under one of its Precautionary fund facilities. Special Envoy to Prime Minister Mia Mottley on Investment and Financial Services Professor, Avinash Persaud, said the Government is looking to embrace as many life-saving safety nets against unexpected global health, economic, and natural disaster shocks as possible.
While not identifying a specific precautionary facility at this stage, Professor Persaud said that Government was considering the range of precautionary funds available within the IMF. He pointed out that the chosen one would add to an existing Bajan-styled safety net for debt relief, which Barbados is trying to convince the major countries to support. Additionally, the country has expressed interest in applying to the IMF for a precautionary fund to act as a buffer in the event the government needs to tap it for assistance.
Moreover, with the ongoing pandemic, the war on Ukraine, and effects of climate change, Professor Persaud argued that the more safety nets, emergency facilities and war chests available to the country, the better the Government can protect Barbadians and by extent, the economy.
On June 24, WiPay, a Caribbean payment solutions company, launched in the Cayman Islands, according to an interview conducted by WiPay founder and CEO Aldwyn Wayne, who expressed delight about the launch.
'I am excited because of the potential relationship with Digital Cayman and all the government initiatives that they are trying to find a solution for can be solved by our platform,' Wayne said.
Of note, Digital Cayman is a public sector body that supports companies seeking to establish a physical presence in the country while empowering the workforce in Cayman to pursue careers in technology and helping to guide regulatory and legislative change.
WiPay is positioning itself to fill a void that currently exists in the Cayman Islands in terms of the government's social payments to its population.
The largest number of expatriates living in the Cayman Islands were born in Jamaica, as such, this would facilitate an easy transfer of money via WiPay’s settlement network to loved ones back home. Mr. Wayne has stated that the transfer of money from Cayman to Jamaica through WiPay is going to be cheaper and quicker than using a bank transfer or a remittance company.
Leaders of the world’s biggest developed economies are weighing a cap on the price of Russian oil meant to strike at the main pillar of the Kremlin’s finances following its invasion of Ukraine — and to limit the havoc that high energy prices are wreaking worldwide.
Details haven’t been agreed at the Group of Seven summit in Elmau, Germany, but the basic idea would be to tie the price cap to the services that make trading oil possible. For instance, insurers would be barred from dealing with shipments that are above the cap, wherever it winds up being set.
Because such service providers are largely based in the European Union and United Kingdom, Russia would be expected to face difficulty finding large-scale workarounds. Limiting the price would reduce the Kremlin’s income from oil — at the start of the war, it was about $450Mn per day from Europe alone. The cap also would limit the impact of higher oil prices on inflation in consuming countries, with the cost of gasoline and diesel squeezing consumers and businesses.
Russia has been able to find buyers outside the West as Asian customers — like India and China — have replaced the EU as the biggest buyers of oil shipped by sea. Due to sanctions, Russian oil is trading at a steep discount to international benchmark Brent, fattening the profit margins of refiners in India who turn crude into gasoline. And some Russian oil sales have simply gone off the books.
Russia defaulted on its international bonds for the first time in more than a century, the White House and Moody's credit agency said, as sweeping sanctions have effectively cut the country off from the global financial system, rendering its assets untouchable.
The Kremlin, which has the money to make payments thanks to oil and gas revenues, has rejected the claims, and accused the West of driving it into an artificial default.
Some bondholders said they had not received overdue interest on June 27, 2022, following the expiration of a key payment deadline on June 26. Moody's credit agency later said that the missed coupon payment constituted a default. Russia has struggled to keep up payments on $40Bn of outstanding bonds since its invasion of Ukraine on Feb. 24.
Russia's finance ministry said it made the payments to its onshore National Settlement Depository (NSD) in euros and dollars, adding it had fulfilled obligations. On the other hand, credit rating agencies usually formally downgrade a country's credit rating to reflect default, but this does not apply in the case of Russia as most agencies no longer rate the country.
A formal default would be largely symbolic given Russia cannot borrow internationally at the moment and doesn't need to thanks to its oil and gas export revenues. However, the stigma would probably raise its borrowing costs in future.
The Jamaica Tourist Board (JTB) is projecting that the island will welcome approximately 800,000 visitors for the 2022 summer period (late June to the end of August) with destination earnings exceeding US$1.1Bn.
Director of Tourism, Donovan White, addressing the official ceremony to welcome the arrival of the inaugural flight from Quality Corporate Aircraft Services (QCAS) on June 22nd said the figures represent 85% of the pre-pandemic (2019) arrival levels, and more than 90% in revenues, respectively.
In light of this, the JTB has revised its forecast of a full recovery of the tourism sector to September 2023 from Q1 2024. The rebound reflects the work of the various stakeholders and the diversification of markets to attract more visitors to the island.
An increase in the length of stay by tourists and the average spend per visitor has also supported the recovery. The length of stay has now moved from an average 8 1/2 nights to 9.2 nights and the spend per visitor, per day, has also increased from US$169 to about US$182.
The news supports Jamaica’s recovery estimations and highlights its ability to have destination revenues outpace the recovery of visitors. The performance of the sector thus far has led the Ministry to be bullish about the sector recovering faster than initially expected.
The Bank of Mexico (Banxico) on June 23rd increased its benchmark interest rate by a record 75 basis points to 7.75%, noting that more rate hikes would be forthcoming, if necessary, as the central bank seeks to tame galloping inflation.
Banxico, has been raising rates as it tries to moderate spiraling consumer prices, having increased the benchmark rate by 375 basis points since mid-2021. Of note, domestic inflation hit an annualized rate of 7.88% in the first half of June 2022, well above the central bank's target of 3%, plus or minus one percentage point, data earlier in the day showed.
Thursday's move echoes the Federal Reserve's hike last week by three-quarters of a percentage point, its largest increase in more than 25 years, and comes as policymakers in regional powerhouse Brazil also raised rates to 13.25% and penciled in another hike for August.
Banxico underscored that in addition to inflationary shocks stemming from the COVID-19 pandemic, there are pressures linked to Russia's war in Ukraine and strict lockdown measures imposed by China. "The balance of risks for the trajectory of inflation within the forecast horizon is biased significantly to the upside," said Banxico.
In view of greater-than-anticipated pressures on prices, Banxico revised up its forecasts for headline and core inflation. However, the bank still expects inflation to converge to its 3% target in the first quarter of 2024. Carlos Morales, director, Latin America Sovereigns at Fitch Ratings projects that Banxico will hike rates to 8.5% by the end of 2022.
