• VM Financial Group has raised $11 billion in a preference share offer. VM Financial Group, the newly established financial holding company for VM Group Limited, put up the offer through a restricted placement, made available to accredited investors only. The shares, first offered in April, were listed on the Jamaica Stock Exchange on Friday.
• Of that sum raised, $6.8 billion came from converted VM Building Society Deferred Shares, while $4.2 billion in new funds are listed as Class A, B and C shares. Class A was offered at a 10% dividend rate, Class B at 11.21% variable, and Class C at 12.5% fixed to float.
• Fixed-to-float securities pay a defined return for a given period; however, the payout may change based on specific criteria.
• VM Group’s President and CEO Courtney Campbell has explained that the funds will be used to strengthen the capitalization of the Group's operating subsidiaries and support growth plans. Mr. Campbell also noted that the Group is exploring regional partnership opportunities, as well as avenues to expand its payments business. 

(Source: RJR News)

• The European Union (EU) pledged more investment for Latin America and the Caribbean at a summit on Monday as part of a revamp of its international relationships prompted by Russia's war on Ukraine and the growing wariness of China.
• As over 50 leaders from the three regions gathered in Brussels for the two-day EU-CELAC (Community of Latin American and Caribbean States) summit, European Commission President Ursula von der Leyen told a business forum that Latin America, the Caribbean and Europe needed each other more than ever.
• The EU is looking to forge new energy partnerships after severing ties with Russia, which was the bloc's biggest gas supplier before the Ukraine invasion in February last year.
• It also wants to reduce its reliance on China and build new alliances to secure minerals critical for electric vehicles and the broader transition to a low-carbon economy, a supply chain China dominates.
• "The world we live in is more competitive and conflictual than ever before. Still reeling from the heavy toll of the COVID-19 pandemic, the world is taking a hard impact from the Russian aggression against Ukraine," she said. "And this happens against the backdrop of China's growing assertiveness abroad," she added.
• She said the EU was planning 45 billion euros of investment in Latin America and the Caribbean as part of its Global Gateway scheme, widely seen as a rival to China's Belt and Road programme of infrastructure investments.
• While the EU has acknowledged that its Latin American partners have sometimes been overlooked as China's role in the region has risen, it is now eager to re-engage.
• This renewed engagement and investment from the EU could bring significant economic opportunities to the region, potentially boosting growth, creating jobs, and fostering sustainable development. It could also help to diversify the region's international relationships and reduce its reliance on any single partner.

(Source: Reuters)

• The European Union (EU) envoy in Guyana has been facilitating talks for possible pharmaceutical production in Guyana.
• This is according to the European Union Ambassador to Guyana Rene Van Nes, during an interview with reporters on Thursday, July 13. He said that this initiative is about seeing if Guyana, together with Barbados and Rwanda could play a role in pharmaceutical production.
• Van Nes related that this is an interesting South-South operation. The EU, he said, assisted Rwanda to set up its own production facility for pharmaceuticals, which started with ‘COVID’ and the realisation that there was in Africa no production facility for ‘COVID’ vaccines.
• Further to this, the ambassador said that a relationship was made between the President of Rwanda, the Prime Minister of Barbados and Guyana’s President Dr. Irfaan Ali.
• He said that these leaders have begun talks on how to replicate this type of facility in Barbados and Guyana. Van Nes said: “That is a very fascinating process, so we actually have people coming up and down. We have experts that already came to Guyana to look at the possibilities; of course, this is not the EU that is going to invest. What we want is to bring European companies to Guyana and Barbados to create here, production facilities in the pharmaceutical sector.”
• This, he added, means that Guyana would have to look at its regulatory framework, investment environment, and scientific ecosystem to facilitate same. The ambassador related that the EU hopes that together with the government and experts, they would be able to create such an environment that would encourage the European private sector to invest in this sector.

(Source: Guyana Chronicle)

• China's economy grew at a frail pace in the second quarter as demand weakened at home and abroad, with the post-COVID momentum faltering rapidly and raising pressure on policymakers to deliver more stimulus to shore up activity.
• Chinese authorities face a daunting task in trying to keep the economic recovery on track and putting a lid on unemployment, as any aggressive stimulus could fuel debt risks and structural distortions.
• The gross domestic product grew just 0.8% in April-June from the previous quarter, on a seasonally adjusted basis, data released by the National Bureau of Statistics showed on Monday, versus analysts' expectations in a Reuters poll for a 0.5% increase and compared with a 2.2% expansion in the first quarter.
• On a year-on-year basis, GDP expanded 6.3% in the second quarter, accelerating from 4.5% in the first three months of the year, but the rate was well below the forecast for growth of 7.3%. The annual pace was the quickest since the second quarter of 2021, although it was heavily skewed by economic pains caused by stringent COVID-19 lockdowns in Shanghai and other major cities last year.
• "The data suggests that China's post-COVID boom is clearly over," said Carol Kong, an economist at the Commonwealth Bank of Australia in Sydney. "The higher-frequency indicators are up from May's numbers, but still paint a picture of a bleak and faltering recovery and at the same time youth unemployment is hitting record highs." The latest data raises the risk of China missing its modest 5% growth target for 2023, some economists say.
• More timely June data, which was released alongside the GDP numbers, showed China's retail sales grew 3.1%, slowing sharply from a 12.7% jump in May. Analysts had expected growth of 3.2%. Industrial output growth unexpectedly quickened to 4.4% last month from 3.5% seen in May, but demand remains lukewarm.

(Source: Reuters)

• The jump in interest rates has wiped more than 2 trillion pounds off household wealth in Britain over the last year due to the fall in house prices and the value of bonds which has hit pensions, a report published on Monday showed.
• However, the Resolution Foundation think-tank said younger people could benefit from the partial reversal of the decades-long climb in the value of household wealth.
• The Bank of England has raised borrowing costs 13 times in a row since December 2021, taking its base rate from 0.1% to 5%, and it is expected to keep on raising rates to bring down the highest inflation among Group of Seven nations.
• "The current surge could be a blip, or herald a new era for the UK. Either way, policy-makers should focus more on whether and how to insulate households from wild swings in their fortunes from these forces well beyond their control."
• The Resolution Foundation said 2.1 trillion pounds ($2.75 trillion) had been lost in terms of household wealth over the last year after an unprecedented surge in recent decades which took wealth to 17.5 trillion pounds in 2021.
• The fall represented the biggest drop in wealth as a share of gross domestic product - from 840% to 650% by early 2023 - since World War Two.
• If interest rates stay high, the continued erosion of household wealth would end a 40-year asset boom that has aggravated generational inequality caused by rising house prices which helped older people but left out younger people, it said.
• Younger people could also benefit from higher pension savings rates, the foundation said.

(Source: Reuters)

• JMMB says it is set to deploy more than a billion dollars in private equity investments.  Kareem Tomlinson, General Manager of JMMB Securities, said the entity is looking to tap into several areas. 
• The company would have launched its private equity investment company, Vertex SME Holding which is managed by JMMB Securities Limited where JMMB is also the anchor investor in Vertex. The company had raised $1.5 billion and of that amount, has deployed just about half of that. Mr. Tomlinson noted that the company has invested in two completed deals, including a quick-service restaurant operator in Guyana that is looking to expand into the wider Caribbean.
• He further highlighted that the second deal will be announced shortly, and is an investment in a major car rental company. Currently, the company has a strong pipeline that consists of 20-plus deals and will be deploying the remainder of that $1.5 billion in short order.
• Tracey-Ann Creary, who is the corporate development manager in charge of Real Estate at JMMB said that the company is also expanding its real estate business. As it relates to this business line, the focus will be mostly on commercial and warehousing projects. They plan to also establish the business line using its existing bank. Currently, there are three commercial office spaces in the design phase that the public will hear about shortly. Additionally, about 100,000 square feet of office space will be rolled out over the next two to three years.
• This forms part of the company’s strategic objective to capitalize on the opportunities in the real estate market to expand its income stream and bring value to its shareholders. The company intends to plan, design, develop, and construct properties and later bring them to market for sale, lease, or sale-leaseback as it doubles down on real estate in response to the market demands and trends. 

(Source: RJR)

• The Government has furthered efforts to boost the country’s food security with the announcement of $35 million in support for the Jamaica Organic Agriculture Movement (JOAM).
• Minister of State in the Ministry of Agriculture, Fisheries and Mining, Hon. Franklin Witter, made the announcement on Thursday (July 6) during the organization’s annual ‘Farming as a Business’ conference at the University of Technology (UTech), where he noted that the support will be channelled towards JOAM’s soil regeneration and fertility improvement project.
• He noted that the objectives of this project include rebuilding soil health, training farmers in soil and water management techniques, and raising public awareness of the importance of regenerating the natural environment, among other things.
• The State Minister pointed out that investing in soil health is one of the most important steps to address global food security, climate change and improve farmers’ financial well-being.

(Source: JIS)

• Fitch Solutions now expects 2.3% real GDP growth in Brazil in 2023, up from the 1.7% previously, putting them slightly above the Bloomberg consensus of 2.1%.
• In the last forecast for Brazil, coming on the heels of a hot growth print for Q123, Fitch noted that risks to its growth forecast were clearly to the upside, as economic data in Q2 was also looking solid, as strong private consumption and robust exports continue to fuel growth.
• Data has continued to look good in the weeks since, underlined by 3.3% y-o-y growth in economic activity in April (0.6% m-o-m, seasonally adjusted). This suggests that Fitch’s forecast for the quarter (previously 1.2%, since revised to 2.2%) and the year were too low.
• While the new forecast for 2023 still marks a deceleration from the 2.9% growth in 2022, it nevertheless is a notable improvement from where the agency estimate and consensus stood at the beginning of the year (around 1.0% growth).
• That said, Fitch expects growth to moderate later in 2023 into 2024, forecasting 1.4% growth that year, due to weaker exports and the lingering impact of elevated rates, even as the BCB (Banco Central do Brasil) begins to ease in H223.

(Source: Fitch Solutions)

• The United Nations’ top official urged all countries to phase out coal and other fossil fuels to avert climate “catastrophe.”
• Keeping the global temperature rise to 1.5 degrees Celsius is still doable, UN Secretary-General António Guterres said while speaking to journalists, but this will have to demand a 45% reduction in carbon emissions by 2030. If current policies continue, temperatures may rise to 2.8°C by the end of the century, which definitely “spells catastrophe.”
• Guterres called for immediate global action toward net-zero emissions, which “must start with the polluted heart of the climate crisis: the fossil fuel industry. He said countries must massively boost investment in renewable energy.
• In the Caribbean, countries like St Kitts and Nevis, Trinidad and Tobago, and Dominica have shifted and invested towards cleaner sources of energy.
• Notably, St Kitts and Nevis received US$17Mn funding from the Caribbean Development Bank for its two geothermal production wells.
• Additionally, the Commonwealth of Dominica’s geothermal plant has progressed significantly over the years. Recently, the plant received a “significant boost” with the proposal to develop an industrial-scale green hydrogen complex.
• While the Caribbean region has not collectively developed a sustainable energy pathway, advances in solar, wind, battery storage technologies and other green project investments in other countries are anticipated to become increasingly common across the region.

 (Source: Caribbean News Now)

• The International Monetary Fund said on Thursday that first-quarter global growth slightly outpaced projections in its April forecasts, but data since then has shown a mixed picture, with "pockets of resilience" alongside signs of slowing momentum.
• The IMF said in a briefing note for a G20 finance leader’s meeting in India next week that manufacturing is showing weakness across G20 economies and global trade remains weak, but the demand for services is strong, particularly where tourism is recovering.
• The IMF did not indicate any changes to its April 2023 global GDP growth forecast of 2.8% - down from 3.4% in 2022 - but said that risks were "mostly" tilted to the downside. These include the potential for Russia's war in Ukraine to intensify, stubborn inflation and more financial sector stress that could disrupt markets.
• However, the Fund said that inflation "seems to have peaked" in 2022, and core inflation, while also easing, remains above targets in most G20 countries. “Reduced supply chain disruptions and lower goods demand mean likely disinflationary pressures from goods,” the IMF said.
• "However, services inflation - which is now the major driver of core inflation - is expected to take longer to decline," the IMF said. Strong consumer demand for services, buoyed by demand, strong labour markets and the post-pandemic shift in spending from goods to services, is likely to sustain these price pressures, the IMF said.

(Source: Reuters)