• Jamaica is being hailed as “exceptional” for achieving a sustained reduction in the public-debt-to-gross-domestic-product ratio (GDP), despite global financial crises, pandemics, and other emergencies.
• In a paper titled ‘Sustained Debt Reduction: The Jamaica Exception’, authors Serkan Arslanalp, Barry Eichengreen and Professor Peter Blair Henry, noted that the sharp, sustained reductions in public debt are outstanding “because public-debt-to-GDP ratios have been trending up in advanced countries, emerging markets, and developing countries alike”
• The paper was presented at the Brookings Institute in Washington on Thursday (March 28). It pointed out that governments have borrowed in response to financial crises, pandemics, wars and other emergencies, resulting in higher debt ratios. However, only in rare instances have they succeeded in bringing those higher debt ratios back down once the emergency passed.
• In the case of Jamaica, the Government was able to cut its debt ratio in half from 144% of GDP at the end of 2012 to 72% in 2023.
• The economists noted that the achievement was despite vulnerability to hurricanes, floods, droughts, earthquakes, storm surges and landslides, noting that Jamaica is ranked as the third most disaster-prone country in the world according to the Global Facility for Disaster Reduction and Recovery.
• The paper also highlighted the fact that the Fiscal Responsibility Framework, introduced in 2010, required the Minister of Finance to take measures to reduce, by the end of fiscal year 2016, the fiscal balance to nil, the debt-GDP ratio to 100%, and public-sector wages as a share of GDP to 9%.

(Source: JSE)

• The Ministry of Agriculture, Fisheries and Mining is collaborating with Jamaica Customs to complete the export component of the Jamaica Single Window for Trade (JWIFT) for implementation in the upcoming fiscal year.
• Minister of State, Hon. Franklin Witter, in a speech read by Chief Technical Director in the Ministry, Orville Palmer, said that the export platform is almost complete.
• “The export Single Window platform has been developed and is now at 90 per cent ready for implementation. However, before we make the system live, we will conduct a series of trials to ensure its effectiveness. The Ministry is collaborating with the Jamaica Customs Single Window entry team to have this platform up and running in 2024/25,” he said.
• He was addressing the Fresh Produce Exporters Forum on Monday (March 25) at the Medallion Hall Hotel in St. Andrew.
• JSWIFT provides a web-based portal that supports cross-border trade in Jamaica. It is designed to facilitate the Plant Quarantine Produce Inspection (PQPI) branch’s import and export business processes by providing a paperless service within a single trade mechanism, resulting in improved cost savings.
• It will also enable clients to submit applications before visiting export complexes and the production of phytosanitary and fumigation certificates, which will allow all exporters to download and print their documents from the comfort of their offices or homes.
• Witter noted that this will reduce processing time and improve communication with international trading partners by providing advanced notification of shipments.

(Source: JSE)

• Guyana is well on its way to achieving 2,000 hotel rooms by 2025 to accommodate the vast influx of visitors the nation has been witnessing in recent days. Minister of Tourism, Industry and Commerce, Oneidge Walrond recently inspected ongoing works of the new Aiden Hotel located at Robb and Oronoque streets in the capital city.
• The boutique-style edifice is among other branded hotels that will open in Guyana to supplement the growing hospitality sector. “The contractors have assured us that by May, this project will be completed. As you know, in June, we have the international cricket finals then we have CPL right after. We are optimistic that we will have rooms for our visitors as they come for these events,” she said.
• The country recorded the highest levels of arrivals last year (2023), with a record-breaking 319,056 visitors. This is a clear testimony to the growth of the tourism and hospitality sectors.
• Minister Walrond highlighted that the government had anticipated an exponential rise in visitors to Guyana, following its resumption of office in 2020.
• “We have seen the realisation of that and that is why we sent out an expression of interest in 2020. These projects take a long time to add additional rooms and we are well on our way for those rooms to be realised for our guests to have internationally branded standard hotels that they are accustomed to,” the tourism minister pointed out.

 (Source: Guyana Chronicle)

• As with most other Central American markets, the improved outlook for US growth in 2024 will have positive effects on the Costa Rican economy - particularly on exports. Furthermore, economic risks have moderated somewhat in Costa Rica in recent months.
• Inflation has been falling persistently (partly due to a strong rally in the Costa Rican Colón), which bodes well for private consumption, while an ongoing interest rate cutting cycle will reduce borrowing costs, support business sentiment and help to lift fixed investment.
• That said, Fitch has raised its 2024 real GDP growth forecast for Costa Rica from 2.5% to 3.1%, with H1 2024 likely to be particularly strong, before a slowdown in H2 2024 as the US economy loses steam and public spending in Costa Rica stagnates.
• Notwithstanding, while Costa Rica faces less substantial political risks than many of its peers in Central America, those risks have been rising in recent months.
• The country has seen a series of protests due to frustration with public services and President Rodrigo Chaves' fiscal consolidation agenda, which will remain in place as the country seeks to comply with an IMF-backed reform programme. The country also faces notable security challenges, with rising gang activity and homicide rates, as well as a state of emergency due to a sharp increase in migration.
• However, falling inflation and strong growth should help cap the level of social discontent, aided by the stability of the country's democratic institutions.

(Source: BMI)

• Despite an increase in the number of Americans filing new claims for unemployment benefits, the labour market remains tight. Although layoffs rose to a 14-month high in March, job cuts were relatively unchanged compared to the same period last year. Worker shortages persist in industries like construction.
• The strength of the economy, coupled with persistently high inflation, may prompt the Federal Reserve to delay anticipated interest rate cuts this year. Fed Chair Jerome Powell has emphasized that the central bank has time to deliberate over its first rate cut.
• The trade deficit widened in February, reaching $68.9 billion, with imports rising to their highest level since October 2022. While exports increased, particularly in industrial supplies, materials, and food, imports surged across various sectors. The trade gap is expected to hinder GDP growth in the first quarter, potentially subtracting as much as 0.75 percentage points.
• The Atlanta Fed lowered its first-quarter GDP growth estimate to a 2.5% rate, down from a previously estimated 2.8% pace. Trade dynamics, particularly the strength in imports reflecting firm domestic demand, are anticipated to contribute to a larger drag on first-quarter GDP growth than initially anticipated.

(Source: Reuters)

• Canada's trade surplus of C$1.39 billion in February exceeded analysts' expectations by a considerable margin, reflecting the resilience and strength of the Canadian economy in global trade. A surge in exports, particularly in unwrought gold, which reached a record level contributed significantly to the overall surplus.
• Total exports saw a remarkable increase of 5.8% in February, marking the fastest growth since August. This growth was primarily fueled by a sharp rise in gold exports, reflecting robust global demand for the precious metal. Import growth, although moderate at 4.6%, also contributed to the trade dynamics. Electronic equipment and consumer goods led the increase in imports, indicating sustained domestic demand and economic activity.
• The trade data reflects a broader economic resurgence in Canada, following a period of slower growth in the second half of the previous year. Recent indicators, including the strong trade surplus and GDP growth, suggest a rebound in economic activity.
• The positive trade surplus and other economic indicators alleviate pressure on the Bank of Canada for immediate interest rate cuts. The central bank has maintained its key interest rate at a two-decade high of 5% to curb inflation.

(Source: Reuters)

• Productive Business Solutions Limited (“PBS”) announced that it has reached an agreement with Xerox Holdings Corporation (“Xerox”), which is listed on the NASDAQ stock exchange, to acquire its businesses in Peru and Ecuador.
• Following the acquisition, PBS will become the exclusive distribution partner for Xerox in Peru and Ecuador, where both companies will continue to operate as subsidiaries of PBS.
• PBS has partnered with Xerox for over two decades. During this period, the company has consistently delivered a comprehensive suite of products and professional services to its clients across Central America, the Caribbean, and South America.
• This strategic expansion in Peru and Ecuador further solidifies the company’s presence in Latin America, extends its footprint to a total of 24 countries and bolsters its workforce to over 3,000 IT professionals.

(Source: JSE)

• The Bank of Jamaica (BOJ) has issued new service-level standards as guidelines for the operation of Automated Banking Machines (ABMs) by deposit-taking institutions (DTIs) which are regulated by BOJ.
• The new standards were issued on April 2 and DTIs have a nine-month transition period to bring themselves into conformity with the guidelines, given the far-reaching nature of the service-level standards.
• Compliance will be assessed through BOJ’s review and publication of monthly reports from the DTIs. No monetary sanctions will be applied as a result of breaches of the guidelines; however, non-adherence may give rise to supervisory concerns around safety and soundness with the attendant supervisory consequences.
• Monthly reports on the performance of each DTI’s fleet of ABMs will be published with a two-month lag. These reports will include the geographical distribution of ABMs, the number of machines that were installed, the proportion of ABMs that were operational for the reporting period, the uptime for operational machines over the period and the recovery time for malfunctioning machines.
• The ABM standards have been issued in a context where, despite the increasing availability and use of electronic payment methods, a significant number of Jamaicans still rely on cash to conduct transactions.
• The new framework will be supported by appropriate legislation under the Twin Peaks system of financial sector regulation, which is being developed. The standards also form part of the practising of the Twin Peaks regime ahead of the passage of supporting legislation.
• The highlights of the standards include; Availability of Cash, Maintenance & Management of Service Disruption, ABM Fees and Charges, Deployment of Machines, Accessibility and Ease-of-Use, Fraud Minimisation, Safety and Security of Customers and Financial Education of ABM Users.

(Source: JSE)

• The severe drought which has forced the Panama Canal, one of the world's busiest trade passages, to limit daily crossings could impact global supply chains during a period of high demand, S&P Global said on Wednesday.
• The canal has imposed several restrictions since 2023, though last month the Panama Canal Authority bumped up daily crossings to 27, from 24, as water levels rose at the man-made Gatun Lake, which feeds into the canal.
• "Capacity pressures at the Panama Canal are starting to affect supply chains," S&P Global said in an analyst report on the transportation of cargo and raw materials. "Container ships have yet to feel the impact in light of their priority status, although the situation is changing."
• Container ships have priority to pass through the Panama Canal, but transit restrictions have hurt other categories, particularly bulk carriers.
• If rains return in May as expected, the canal authority plans to ramp daily slots back up to about 36 per day, the average during the rainy season.
• The need to maintain water levels at the reservoirs feeding into the canal has prevented it from absorbing demand from shippers seeking alternative routes away from the Red Sea, where Houthi attackers have blocked the passage of ships in the Suez Canal, the world's busiest waterway.

(Source: Reuters)

• Chile's GDP is expected to grow 2% to 3% in 2024, up from a previous forecast of 1.25% to 2.25% growth, the country's central bank said on Wednesday.
• The revised forecast was issued a day after slashing its benchmark interest rate by 75 basis points to 6.5% and signaling further rate cuts.
• Chile's economic activity has surprised to the upside in early 2024, overshooting expectations in January and February.
• According to the Central bank, inflation has declined sharply towards the 3% target after peaking in 2022. This was largely due to reduced domestic spending and a narrowing activity gap.
• The central bank said it now projects headline inflation to end this year at 3.8% in light of the local currency's recent depreciation, up from a previous estimate of 2.9%, but still sees it converging to the target within its two-year policy horizon.
• It also projected GDP growth in 2025 and 2026 to range between 1.5% and 2.5%, indicating a convergence to the economy's potential growth rate. The projection for next year came in slightly below the previous growth forecast of 2% to 3%.

(Source: Reuters)