• The scale of the escalating difficulties at Evergrande remains unclear, but the house builder’s financial problems are focusing attention on long-running problems in China’s property sector. 
• The highly-leveraged firm appears to be unable to service its debts, which could force a state-backed bailout or some form of restructuring on a scale never before attempted in China. Since the firm’s liabilities are believed to exceed USD300bn (about 2.0% of GDP). 
• Over the past week growing fears surrounding the situation at Evergrande have hit emerging financial markets. Currencies have weakened against the US dollar, while equity markets have sold off. While Asian markets suffered, so did widely traded emerging market (EM) currencies, which suggests that investors are worried about economic conditions generally. 
• Fitch Solutions maintained its 2021 growth forecast for China at 8.3% for now but admits that the risk that Evergrande's difficulties will cause meaningful damage to the Chinese economy is growing.

(Source: Fitch Solutions)

• Minister of Tourism, Hon. Edmund Bartlett, has said cruise shipping remains an important value-added complement to stopover arrivals and will also be a crucial component to Jamaica’s tourism recovery efforts. 
• Two cruise ships are expected to call in Ocho Rios this week, bringing the number of vessels to have called on the resort town since the phased reopening of the sector in August to 5. Mr. Bartlett noted that this development underscores the growing demand for destination Jamaica and the success of efforts to reopen the tourism sector. 
• Since the return of stopover visitor arrivals since June 2020, Jamaica has been seeing steady growth towards pre-COVID-19 levels, and now that the cruise shipping industry is back on stream, significant growth in the numbers is expected. 
• Assistant Director for Marketing and Communications at the Port Authority of Jamaica (PAJ) Kimberly Stiff, said the PAJ has been working overtime with other government agencies to keep things in order, in order to attract a lot more ships. 
• However, the Centers for Disease Control and Prevention (CDC) has assigned Level 4 travel advisory status to Jamaica, which cautions US travelers to avoid travelling to Jamaica unless fully vaccinated. This could deter cruise ships from docking in Jamaica and underscores the importance of controlling the spread of the coronavirus variants and reducing the infection rate.  

(Source: JIS News)

• The Bahamas has returned to pre-hurricane gross domestic product (GDP) levels between four to eight months after each of the last four major storms struck this nation, a study has found. 
• An Inter-American Development Bank (IDB) report, produced by four authors on the impacts of Dorian, Irma, Matthew and Joaquin, found that this country’s economy rebounded relatively quickly despite the combined $4.4bn worth of damage they inflicted. 
• This, though, is likely explained by the fact that New Providence, which generates roughly 70-75 percent of the country’s economic output (GDP), was not directly impacted by any of these storms apart from Hurricane Matthew which failed to score a direct hit in October 2016. 
• In measuring the storms’ impact the IDB report has stated that it takes between four and eight months on average for the economy to recover to pre-hurricane GDP levels for the hurricanes studied.”
• “The results show that The Bahamas experiences a decrease in the year-to-year nominal growth rate during the month and quarter of a hurricane impact event, but does not show a contraction of GDP in the year of the event. However, this does not mean that the damages are insignificant.”

(Source: IDB & The Tribune)

• The continued spread of COVID-19 in Trinidad & Tobago (T&T) will keep unemployment elevated in the coming months, raising risks to social stability and weakening the popularity of the ruling, centre-left People’s National Movement (PNM). 
• Fitch Solutions has revised down T&T’s score in its Short-Term Political Risk Index (STPRI) to 60.8 out of 100, from 61.5, due to the growing risks to social stability in the months ahead. 
• Moreover, Fitch sees increased risks to the PNM’s goal of enacting fiscal consolidation in the medium term, as austerity measures would likely further undermine the party’s public standing and potentially provoke public protests against these reforms.

(Source: Fitch Solutions)

• On September 22, the US Federal Reserve kept its benchmark rate at 0-0.25%, and Fitch Solutions expects it will remain at this level until 2023. However, the Fed made two signals that policy changes are approaching. 
• Firstly, the Federal Open Market Committee (FOMC) stated that "a moderation in the pace of asset purchases may soon be warranted." Secondly, according to an accompanying 'dot plot' of FOMC member's projections, half of participants (nine) now expect interest rate increases will commence in 2022, up from seven in the June meeting. 
• Fitch anticipated an announcement that the Fed is preparing to taper its asset purchases, as did markets, given persistent inflationary pressure, a rebound in growth and broad financial market stability. Over recent months, the Fed has pursued a cautious communication strategy regarding its asset purchases in order to manage market expectations and avoid a 'taper tantrum', a goal it appears to have achieved. 
• In his remarks following the policy decision, Fed Chairman Jay Powell stated that policymakers broadly expect a gradual tapering that concludes by the middle of 2022 and reiterated that the timing of interest rate hikes is not directly tied to the reduction in asset purchases. As such, Fitch maintains a neutral outlook for fixed income markets and does not expect a sudden and sharp rise in yields.

(Source: Fitch Solutions)

• The U.S. Food and Drug Administration on Wednesday authorize a booster dose of the Pfizer Inc and BioNTech COVID-19 vaccine for those 65 and older, all people at high risk of severe disease, and others who are regularly exposed to the virus. 
• The decision paves the way for a quick rollout of the booster shots as soon as this week for millions of people who had their second dose of the vaccine at least six months ago. 
• The change to the vaccine's emergency use authorization will allow boosters for groups such as health-care workers, teachers and day care staff, grocery workers and those in homeless shelters or prisons, FDA acting Commissioner Janet Woodcock said in a statement. 
• Pfizer had asked the FDA to expand its vaccine approval to include boosters for all people aged 16 and older and presented data last week to an outside FDA panel of advisers that it said showed waning immunity over time. 
• The panel voted against the proposition that boosters were needed by everyone but said evidence showed they were helpful to older people and those at high risk.

(Source: Reuters)

• An increase in revenue has contributed to a 31.9% YoY increase in LAB’s net profit for the nine months ended July 31, 2021; net profit ended the period at $142.18Mn (EPS: $0.15). 
• Revenue increased by 37.3% YoY, driven by growth in media placement (up 39.4%) and production (up 62.2%). This growth was, however, tempered by a reduction in agency (down 1.8%) during the period. An increase in finance income (+462.2%) also supported earnings growth. 
• The company’s bottom line was however tempered by a 32.6% YoY increase in administration expenses on the back of higher staff costs,  repairs and maintenance of production equipment, depreciation and amortization charges, and lease interest. The increase in staff costs reflects higher work volume. Despite this increase, administrative expenses as a percentage of revenue remain relatively flat at 16.7% compared to 17.3% in the previous period. 
• The LAB’s stock price has increased 7.8% since the start of the year and closed Tuesday’s trading session at a price of $4.20 per share. At this price, the stock trades at a P/E ratio of 19.4x earnings.

Source: (The LAB Financials)

• For the Three Months ended May 31, 2021, Portland JSX Limited reported a net profit of US$354,598 relative to the US$1.40Mn loss in the corresponding period of the prior year. 
• The major driver for this earnings result was the US$750,683 recorded for net fair value gains on financial investments relative to a loss of US$1.33Mn in the corresponding period of 2020. On the other hand, net interest income fell 65.2% while the company recorded FX losses of US$43,064 for the period. A 3.2% increase in interest expenses and a 63.1% increase in operating expenses also tempered the improvement in earnings. 
• Portland JSX Ltd.’s stock price has fallen to $7.03 per share, down 26.0%  since the start of the year. At this price, the stock trades at a P/E ratio of 13.5x earnings, which is below the main market financial sector average.

Source: (PJX Financials)

• Between 2021-22, Trinidad & Tobago (T&T) will experience consecutive years of real GDP growth for the first time since 2012-13 amid sustained demand for energy exports and recovering private consumption. 
• However, Fitch Solutions has revised its 2021 real GDP growth forecast to 3.4%, from 4.4% previously, as a Q221 COVID-19 outbreak delayed the rebound in private consumption. In contrast, the agency has revised its 2022 forecast upwards to 2.5%, from 2.0%, as Fitch expects vaccinations to strengthen consumption in the quarters ahead. 
• Risks to Fitch’s 2022 forecast are weighted to the downside as economic growth in developed markets has likely peaked, which could undermine demand for energy exports in the quarters ahead.

(Source: Fitch Solutions)

• In the coming weeks, Mexico’s Congress is likely to pass the necessary legislation to hold a recall referendum in March 2022, in which voters will decide if President Andrés Manuel López Obrador (AMLO) should serve the rest of his term through September 2024. 
• Fitch Solutions believes that AMLO is a favourite to win the vote, based on available polling and background conditions such as a recovering economy and growing COVID-19 vaccinations. 
• However, if AMLO does lose the vote, the country would likely face a prolonged period of uncertainty and gridlock as all parties wait for the July 2024 general elections.

(Source: Fitch Solutions)