• Attorney General Anil Nandlall told the Caribbean Financial Action Task Force (CFATF) that Guyana would amend its extradition laws to allow for “easy” extradition of persons to and from the US.
• To bolster international cooperation in legal matters, Guyana is poised to enact comprehensive amendments to its extradition laws, making extradition easier to and from the country, particularly with the United States, Nandlall expressed at the CFATF 58th Plenary and Working Group Meetings in Trinidad on June 4, 2024.
• In Guyana, economic hardship for segments of the population, institutional weaknesses, criminal justice inefficiencies, as well as racial fractures in society provide fertile grounds for corruption. Furthermore, the scale of the informal and illegal economy is particularly notable, as it breeds criminal activities such as drug and human trafficking or illegal logging that are strongly associated with corruption and coercion.
• The amendments, particularly clause two of the Bill, aim to expand the admissibility of evidence in extradition cases. This includes documents, statements, or other evidence that identify and locate the person sought, a statement of facts of the case, and the legal provisions related to the offence and its punishment.
• In recent years, the US has commended Guyana for facilitating the capture and extradition of a number of persons from Guyana to the US. At least one person had been extradited from the US to face a murder charge in Guyana, but the charge was eventually dismissed.
• The amendments to the current extradition laws create a model for future bilateral cooperation that should reduce Guyana’s attractiveness as a haven for criminals in the sovereign. That said, the sovereign still has a long way to go to counter international crime with the need to strengthen the integrity and capacity of Guyana’s criminal justice system.
• Guyana ranks 87 of 180 countries on Transparency International’s Corruption Perception Index for 2023. Its score improved marginally from 39 in 2021 to 40 in 2022 and 2023. That said, at a rank of 87, Guyana has moderately higher levels of perceived corruption when compared to peers like Trinidad (76), Jamaica (69), and Barbados (24) but fairs better than the Dominican Republic (123) and Mexico (126).

(Sources: Guyana Chronicle & NCBCM Research)

• President Luis Abinader has announced that the country has achieved its best export figures in the last three years, with a total increase of 23% compared to the period from 2016 to 2019.
• The president attributed this success to the National Export Promotion Plan (PNFE), which was launched in November 2020 to promote exports and improve competitiveness in global markets.
• Despite the challenges posed by the pandemic and international trade tensions, the Dominican Republic has managed to increase its exports by 23% since 2020, with a total value of $45.804Mn. The country’s main export partner is the United States, accounting for 54.38% of total exports, followed by other major destinations such as Argentina, China, and Japan.
• The president highlighted the growth of medical instruments and devices as a key sector. He also emphasised the importance of promoting women’s participation in the national productive process and their incorporation into international business activities.
• The PNFE has been implemented consensually and coherently, incorporating the perspectives and proposals of national and international institutions, companies, associations, and organisations involved in productive and export development. The plan has been recognised as a benchmark in good international practices and has positioned the Dominican Republic as a world-class logistics hub.
• The government has also implemented various initiatives to promote exports, including the modernization of the General Customs Law, the lifting of impediments to the entry of Dominican products to international markets, and the migration to non-face-to-face channels in the provision of services.

(Source: Dominican Today)

• Saudi Arabia and allied oil producing countries on Sunday extended output cuts through next year, a move aimed at supporting slack prices that haven’t risen even amid turmoil in the Middle East and the start of the summer travel season.
• The OPEC+ alliance, made up of members of the producer's cartel and allied countries, including Russia, extended three different sets of cuts totalling 5.8Mn barrels a day. International benchmark Brent has loitered in the US$81.0 to US$83.0 per barrel range for the past month.
• Even the war in Gaza and attacks on shipping in the Red Sea by Houthi rebels in Yemen have not pushed prices up toward the US$100.0 per barrel level last seen in September 2022. Reasons include higher interest rates, concerns about demand due to slower than desired economic growth in Europe and China, and rising non-OPEC supply, including from United States shale producers.
• Yet the Saudis need higher oil prices to fund ambitious plans by Crown Prince Mohammed bin Salman to diversify the country’s economy away from fossil fuel exports. Analysts say the cuts could push oil prices higher in coming months, but much depends on demand for oil going forward. The summer usually sees a spike in demand through the July-September quarter, but uncertainty about demand grows after that.
• The cuts that are being extended break down as follows: two billion barrels a day agreed among all 23 OPEC+ members were extended through the end of 2025, according to an OPEC statement; then, voluntary reductions of 1.65Mn barrels a day by a smaller group of members was extended until end 2025 as well, according to a report on the official Saudi Press Agency.

(Source: Reuters)

• The European Central Bank cut borrowing costs from record highs on Thursday, acknowledging progress in its battle against high inflation but also signaling that the fight had yet to be won as inflation was set to remain too high until next year.
• Inflation in the 20 countries that share the euro has fallen from more than 10.0% in late 2022 to just above the ECB's 2.0% target in recent months, largely thanks to lower fuel costs and a normalisation in supply after some post-pandemic snags. As a result, the ECB welcomed the fall in price growth as it trimmed its deposit rate to 3.75% from a record 4.0%, its first cut since 2019.
• However, that progress has stalled recently, and what had looked like the start of a major ECB easing cycle only a few weeks ago now appears more uncertain due to signs that eurozone inflation may prove sticky, as has been the case in the United States. It also raised its inflation forecasts for this year and the next stressed any further rate reduction would depend on incoming data, and reaffirmed that borrowing costs needed to remain high enough to keep a lid on prices.
• "Despite the progress over recent quarters, domestic price pressures remain strong as wage growth is elevated, and inflation is likely to stay above target well into next year," the ECB said. Money market investors trimmed their bets on rate cuts after the announcement and only priced in one, with a slight risk of a second, for the remainder of the year.
• Some stronger-than-expected data about eurozone inflation, wages, and economic activity over the last few weeks has fuelled fears of a more difficult "last mile" on the way to the ECB's goal - a concern often expressed by influential board member Isabel Schnabel.
• Inflation in services, which some policymakers have singled out as especially relevant because they reflect domestic demand, has been a particular concern after it rebounded to 4.1% in May from 3.7% a month earlier. Most economists still expect the ECB to continue cutting its policy rate in the coming months and bring it to 2.50% by the end of 2025.

(Source: Reuters)

• Wigton Windfarm Limited (Wigton) announced that it established a new brand, and registered the business name ‘Wigton Energy’. This was done to adopt a brand identity that directionally aligns with its vision and plans to diversify its business into other areas of energy and profitable investments. However, Wigton Energy is only a registered business name. Wigton’s registered name and trading name on the Jamaica Stock Exchange (JSE) remain Wigton Windfarm Limited.
• While Wigton is the largest wind energy facility in the English-speaking Caribbean, it plans to diversify into other areas of renewables, including clean technology solutions and other investment opportunities, to ensure continued growth in shareholders’ value. The new Wigton Energy brand aligns with the company’s diversification strategy.
• On February 16, 2024, there was an Addendum to Wigton’s Power Interchange Agreement with the Jamaica Public Service Company Limited (JPS), to extend the period of operation of its Wigton Phase I plant for another 3 years to April 2027^[1]. With the agreement set to expire in 3 years, diversifying Wigton’s business is critical to business continuity.
• To steer the company into this new strategic direction, Wigton recently recruited Mr. Gary Barrow as Chief Executive Officer and appointed Ms. Michelle Chin Lenn as Deputy Chief Executive Officer. Mr. Barrow has 30 years of leadership experience in the telecommunications/energy sector and was a former Chief Operating Officer of JPS. Ms. Chin has 17 years of experience on Wigton’s Management team and was Head of Energy.

 (Source: JSE & NCBCM Research)

^[1] The extension for another three (3) years is as of April 1, 2024.

• As preparations ramp up for the highly anticipated 10th Biennial Jamaica Diaspora Conference, seasoned professionals in the real estate sector are extending a compelling invitation to Jamaicans abroad to Invest in Jamaica’s burgeoning real estate market.
• Newton Johnson, President of the Realtors Association of Jamaica (RAJ), and Petal Hall, Group Sales Executive at The Jamaica National Group and Realtor Associate with JN Properties Limited, are advocating for this timely opportunity despite recent shifts in mortgage rates.
• Johnson and Hall underscore the opportune time for overseas Jamaicans to invest in the local real estate market. Even with the recent increase in mortgage rates, they maintain that Jamaican property investments offer considerable return potential.
• Johnson points out four main factors that favour such investments, particularly noting the significant capital growth seen in the Jamaican real estate sector. He highlighted Jamaica’s stable political and economic landscape, and the predictability it offers to investors, versus regions affected by conflicts that often lead to economic downturns. Johnson also spoke to the stability of Jamaica's inflation rates, which is vital for sustained economic growth, and the competitive prices of Jamaican real estate relative to other Caribbean locations, increasing its appeal to investors.
• As discussions on Jamaica’s real estate sector gain momentum, Johnson and Hall invite participants to explore further insights at the upcoming Biennial Jamaica Diaspora Conference.

(Source: Caribbean National Weekly)

• On May 8, 2024, the Executive Board of the International Monetary Fund (IMF) concluded the Article IV consultation with Trinidad and Tobago. The group noted that for the first time in a decade, Trinidad and Tobago is undergoing a gradual and sustained economic recovery.
• Real Gross Domestic Product (GDP) is estimated to have further expanded by 2.1% in 2023, reflecting a strong performance of the non-energy sector. Further to this, economic growth is projected to gain momentum in 2024, supported by the non-energy and energy sectors.
• Inflation has declined sharply, mainly due to decelerating global food and imported goods prices. Banks’ credit to the private sector continues to expand, and the financial sector appears sound and stable. Inflation is projected to remain low throughout 2024.
• The current account is estimated to have remained in a surplus in 2023, and international reserve coverage is adequate at 8.3 months of prospective total imports. However, the current account surplus will narrow mainly due to a decline in energy prices and energy exports, which is estimated at 5.7% of GDP in 2024. Overall, international reserve coverage is expected to remain adequate at 7.5 months of prospective total imports.
• On the fiscal front, the fiscal deficit in FY 2023 continued supporting the recovery and was better than budgeted, while public sector debt remained below the authorities’ soft debt target. The fiscal position is projected to remain adequate, reaching a deficit of 2.7% of GDP in FY2024. This reflects lower energy revenues, increased capital spending, and a higher wage bill due to the long-standing public wage settlement with some unions.
• The balance of risks is tilted to the downside in the near term, but there are upside risks in the medium term. In the near term, downside risks stem from external factors affecting energy markets (e.g., an abrupt global slowdown) and domestic sources, such as disappointments in energy production (e.g., delays to new projects or unexpected disruptions to current production). In the medium term, upside risks stem from new natural gas projects and the implementation of planned structural reforms, which could boost growth.

 (Source: IMF)

• At the United Nations (UN) Small Island Developing States (SIDS4) meeting, Prime Minister of Antigua and Barbuda, Gaston Browne, made a significant move by signing a declaration of intent to join CAF - Development Bank of Latin America and the Caribbean.
• Antigua and Barbuda's intention to join CAF marks a strategic move toward accessing vital long-term financial resources and technical cooperation grants aimed at advancing sustainable development. Collaborative efforts with CAF will primarily target critical areas such as climate action, green growth, sustainable tourism, energy transition, and the blue economy.
• "We are very happy to celebrate Antigua and Barbuda's intention to join CAF," said Gaston Browne. "We are fully aligned and ready to work together on the opportunities that CAF can provide to small Caribbean islands like Antigua and Barbuda to achieve greater well-being for their inhabitants."
• CAF's Executive President, Sergio Díaz-Granados, remarked, "The growing partnership between Antigua and Barbuda and CAF demonstrates our commitment to providing Caribbean SIDS with new options for development financing to support the Caribbean with tackling development issues that are affecting their communities."
• CAF was established in 1970 by six Andean countries: Bolivia, Chile, Colombia, Ecuador, Peru, and Venezuela. Since then, its shareholder base has expanded to include 21 countries and 13 private banks. With assets exceeding $53Bn and a project portfolio surpassing $34Bn, CAF stands as one of the primary sources of multilateral financing in the region.
• Currently, Trinidad and Tobago, Jamaica, and Barbados represent the CARICOM member countries of CAF. The Bahamas, Dominica, and Grenada also have access to the technical, financial, and knowledge services offered by the organisation.

(Source: CAF)

• The U.S. Federal Reserve will cut its key interest rate in September and once more this year, according to a majority of forecasters in a Reuters poll that also showed a significant risk the Fed opt for only one or none at all.
• Economists in Reuters surveys over the past few months have remained consistent in predicting two cuts, unlike markets, which until last week were pricing in one in November before flipping back to two. That shift in fed funds futures bets was partly because official data showed the U.S. economy expanded at a slower pace last quarter than estimated earlier, even as key inflation measures remained sticky.
• However, inflation, and particularly the personal consumption expenditures (PCE) price index, which the Fed targets at 2.0%, has remained elevated. Taken together with very low unemployment, that makes an early Fed rate cut very unlikely. None of the measures of inflation - the Consumer Price Index (CPI), core CPI, PCE, and core PCE - were expected to reach 2% until at least 2026, according to median forecasts in the poll.
• "The Fed will be raising its inflation forecast at the June meeting and...it would look odd to raise your inflation forecast and then cut rates quickly after that," said Michael Gapen, chief U.S. economist at Bank of America, who expects just one cut this year, in December. "Our baseline is the economy remains resilient but growth is softening on the margin. The labour market is cooling on the margin. So, the next move is a cut. But I think the primary risk to our baseline is the Fed just doesn't cut...and the labour market doesn't look all that weak to me right now," Gapen added.
• Still, nearly two-thirds of economists, 74 of 116, in the May 31-June 5 Reuters poll predicted the first cut in the fed funds rate to a 5.00%-5.25% range would come in September. Around 60.0% of participants in the latest poll, 68 of 116, predicted two quarter-point cuts this year, broadly unchanged from last month's survey. A sizeable 28.0% minority of economists, 33 of 116, saw only one rate cut this year or none.

(Source: Reuters)

• On Wednesday, the Bank of Canada (BoC) trimmed its key policy rate by 25 basis points to 4.75%, the first G7 country to do so, in a widely expected move that marked its first cut in four years. The Bank also said more easing was likely if inflation continued to ease.
• The bank had increased interest rates by 475 basis points in the space of 16 months until July 2023 and since then had kept it steady at 5%. However, after keeping interest rates at a more than two-decade high of 5% for almost a year, the BoC said the indicators for underlying inflation looked increasingly positive.
• Inflation in Canada has slowed this year to hit a three-year low of 2.7% in April. However, while inflation has stayed below 3% for four months in a row, it is still higher than the Bank's 2% target. Consequently, Governor Tiff Macklem stressed that the timing of the next cut would depend on whether inflation continued its downward trajectory and the economy evolved in line with the bank's expectations.
• "If inflation continues to ease, and our confidence that inflation is headed sustainably to the 2% target continues to increase, it is reasonable to expect further cuts to our policy interest rate," Macklem said in an indication of what future reductions could look like.
• Economists have questioned whether the BoC is running the risk of diverging too much from the Fed. To this Macklem said, “There are limits to how far we can diverge from the United States, but we're not close to those limits."
• On the other hand, some economists predicted the BoC would cut again in July even though financial markets had priced in a 39% chance of a cut to 4.50% next month. The next rate announcement is due on July 24, when the bank will also release its latest quarterly forecasts.

 (Source: Reuters)