• Driven by a reduction in direct expenses incurred, AMG Packaging & Paper reported a 7.8% increase in net profit to $60.59Mn (EPS: $0.12) for the year ended August 31, 2021. The company’s revenues declined marginally during the year. 
• Direct costs fell 7.1% (or $37.51Mn) due in part to lower spending on salaries and related expenses, cost of materials used and repairs and maintenance. 
• However, the performance was tempered by 2.0% (or $14.54Mn) fall off in revenue and a 2.1% (or $2.01Mn) rise in admin expenses given an increase in management remuneration, sanitation and motor vehicle costs. Operations were adversely impacted by lockdowns and curfew hours, which resulted in the decline in revenues. 
• A 95.3% reduction in other revenue influenced by a realised loss on foreign exchange translation and a loss on disposal of assets also tempered the growth in the bottom-line. 
• AMG is currently constructing a new plant, which will produce packaging products made from recycled paper. The company plans to double production capacity and management has indicated that the new plans will enable it to cut costs, as the shortage of paper on the world market continues to drive up the cost of paper. This strategy should support revenue growth, help the company pivot from the effects of the ongoing supply chain challenges, lower costs, and bolster the bottom-line. 
• AMG’s stock price has appreciated by 44.5% since the start of the year and closed Thursday’s trading session at $2.28 per share. This implies a P/E multiple of 19.0x, which is above the junior market manufacturing sector average of 18.7x.

(Source: AMG Financials & NCBCM Research)

• The monthly index of economic activity (IMAE) of Panama between January and September grew by 14.94%, over the same period in 2020, which shows the recovery process from the COVID-19 pandemic impact is well underway. 
• In September the IMAE, expanded by 18.02%, compared to the same month of the previous year, according to data from the National Institute of Statistics and Census (INEC) of Panama released on Tuesday. In the first semester of this year, the Panamanian gross domestic product (GDP) expanded by 10%. International risk rating agencies foresee that the indicator will grow between 8% and 12% in 2021. 
• The expansion of the IMAE in the nine months to September was driven by the mining industry, due to the export of copper ore and its concentrate, construction, the execution of public investments and the gradual reactivation of many private projects private, said the INEC. 
• Economic activity showed a positive rate in indicators such as re-exports in the Colon Free Zone, and local retail and wholesale trade, as well as transportation, storage, and communications services, due to the good performance of the Panama Canal and the movement of containers in ports. On the other hand, hotel services continued to show negative rates, especially due to the low influx of tourists, hikers and passengers in transit, the statistical entity said.

(Source: CariCRIS)

• Mexico’s economy shrank more than expected in the third quarter after new legislation banning labour outsourcing hit the services industry and coronavirus cases surged. Gross domestic product fell 0.4% quarter over quarter, more than its preliminary 0.2% drop and the median estimate of a 0.3% fall in a Bloomberg survey. 
• It’s the first contraction since the second quarter of 2020, when Mexico imposed its harshest set of restrictions to tackle the COVID-19 pandemic. Year over year, GDP grew by 4.5%, according to final data from the national statistics institute published Thursday. 
• The quarterly contraction halts the recovery of Latin America’s second-largest economy, which is far from returning to pre-pandemic levels after suffering last year its worst recession in almost a century. 
• It also contradicts President Andres Manuel Lopez Obrador, who has repeatedly said the economy is doing well despite his decision to avoid additional public spending to support households and companies during the pandemic.

(Source: Bloomberg)

• Headwinds to the hitherto slow recovery of the tourism sector have intensified as a sharp increase in new COVID-19 cases is prompting several developed market (DM) governments to reintroduce mobility restrictions, with particularly negative growth implications for tourism-reliant economies. 
• Data from World Bank show that DM tourism revenues expanded steadily over the past 20 years. Tourism revenues rose to around US$1.0Tn (2.0% of DM GDP) in 2019, before dropping to US$240.3Bn (0.5% of DM GDP) in 2020 following the COVID-19 pandemic. 
• Tourism has recovered over 2021, as national vaccination programmes have progressed, facilitating the reopening of regional economies and the resumption of foreign travel. 
• Fitch Solutions believes that tourism revenues will continue rising in 2022 to reach pre-pandemic levels by 2024, although this timeline is somewhat variable. Indeed, new vaccines and therapeutic treatments could accelerate the normalisation of tourism, while new COVID-19 strains or poor vaccine rollouts could ultimately delay it.

(Source: Fitch Solutions)

• Britain will expand the size and reach of its development finance institution to provide billions of pounds of investment in infrastructure and technology in countries across Asia, Africa and the Caribbean, the government said. 
• Announcing a plan to rebrand government-owned development investment company CDC as British International Investment (BII), the Foreign Office said the move was part of a strategy to deepen economic, security and development ties globally. 
• "Too many countries have become indebted with strings-attached investment and we want to provide an honest, reliable alternative that is going to enable those countries to grow," Foreign Secretary Liz Truss told Reuters ahead of Thursday's launch at an event at the London Stock Exchange. 
• BII will have 9 billion pounds ($12 billion) of finance by 2025, Truss said. Alongside continuing with CDC's current remit of Africa and South Asia, BII will also invest in low and middle income countries in the Indo-Pacific and Caribbean.

(Source: Reuters)

• The Jamaican economy grew by 6.3% in the September quarter as output in both the goods producing and services industries expanded by 2.8% and 7.3% respectively, according to the Planning Institute of Jamaica. 
• The expansion in the goods producing industry was mainly driven by an increase in the real value added for the manufacturing (8.5%), the agriculture, forestry & fishing (7.2%), and the construction (1.7%) sectors.   
• The growth in agriculture reflects the impact of increased demand, particularly from the Tourism sector, and the implementation of measures by the GOJ to improve output in the industry. Higher output from both the Other Manufacturing and the Food, Beverages & Tobacco components, drove growth in the Manufacturing sector. Increased capital expenditure on civil engineering activities, hotel construction and commercial office space influenced growth in the construction sector. Of note, growth in the construction industry has cooled significantly from its brisk pace of 17.4% in Q2 and 10.5% in Q1. 
• All sectors within the services industry expanded, with the hotels and restaurants sector (114.7%) seeing the most significant growth. This reflected an increase in tourism activity relative to Q3 2020 as high vaccination rates in source markets and increased demand for travel allowed several hotels and restaurants to reopen. Notably, for July-August 2021 total stopover arrivals rose by 293.3%, and cruise passenger arrivals totalled 8,379 relative to none in the corresponding quarter of 2020. 
• Prospects for the overall economy in the short-term are positive due to the recent easing of previously implemented containment measures, and the improved outlook for the tourism sector. The resumption of cruise travel and pent up demand for travel as the peak winter tourism season begins augurs well for the sector. The expected growth in tourism should also have spillover effects to other sectors of the economy, including agriculture. 
• An improvement in employment is also expected to fuel private consumption. Real GDP is projected to grow within the range of 5.0% to 8.0% during October–December 2021. However, a possible spike in COVID-19 cases and the reimplementation of more stringent containment measures, is still the major downside risk to the outlook.

(Source: PIOJ)

• The Bank of Jamaica (BOJ) is slated to commence national rollout of the Central Bank Digital Currency (CBDC) platform during the first quarter of 2022. CBDC is a digital form of central bank-issued currency and, therefore, is legal tender that can be exchanged dollar for dollar with physical cash. 
• Deputy Governor with responsibility for Banking, Currency Operations, and Financial Markets, Natalie Haynes, says it is anticipated that by then, additional deposit-taking institutions (DTIs) will be on boarded to enable the issuing of wallets to facilitate an expansion of the number of individuals and businesses utilizing the currency. 
• National Commercial Bank (NCB) is currently the sole DTI participating in the CBDC pilot, which commenced in June and is slated to conclude in December. NCB has developed its wallet and has begun testing the facility with staff and their family members, and there are plans to roll this out, before year end to individuals and small merchants. 
• The next phase will involve testing cash-ins and cash-outs at the automated banking machines (ABMs). The BOJ has also developed a wallet for its staff, and its interoperability with NCB’s will be tested, come December. Interoperability between all wallet providers is an important component of any CDC. 
• According to the Bank, the benefits to be derived by citizens, businesses and the Government from the adoption and introduction of a viable digital currency solution include increased financial inclusion and another means of efficient and secured payments. Additionally, the CBDC represents an opportunity for DTIs to improve cash management processes and costs.

(Source: BOJ)

• Fitch Solutions believes that Mexican President Andrés Manuel López Obrador (AMLO)’s abrupt reversal of course on his nomination for the next governor of the Banco de México (Banxico) will further undermine investor confidence in policy direction. 
• The decision risks weakening investor perceptions of the central bank's independence and credibility as it faces persistent inflationary pressures. 
• While the potential impact on monetary policy is not yet clear, Fitch believes the decision adds to downside risks to Mexico's near-term growth outlook. It previously highlighted elevated inflation and rising interest rates as threats to consumption and investment over the coming quarters. However, this risk could grow as the deterioration of market confidence could feed into higher inflation through both a weaker exchange rate and higher expectations. 
• At the same time, the central bank could now face a more pronounced policy dilemma, in which raising rates threatens growth, but pursuing more dovish monetary policy risks further weakening markets and feeding inflation.

(Source: Fitch Solutions)

• Exports from Latin America and the Caribbean increased 31.2 per cent in the first semester of 2021, driven by the dynamism of external demand, the lifting of restrictions on mobility, and the progress of vaccination campaigns against the novel coronavirus pandemic, according to the Inter-American Development Bank (IDB). 
• The rebound puts the region's external sales of goods 11 per cent above the corresponding level in 2019, after falling 9.2 per cent in 2020 due to the economic crisis caused by the pandemic. 
• The IDB Trade and Integration Monitor report indicated that concurrently, exports of services registered a 33.8 per cent drop after contracting 38.5 per cent in 2020. It noted that more traditional items, such as travel and transportation, were hit hardest. However intensive knowledge-based services proved more resilient. 
• This year's issue of the report, which analyses trade flows in Latin America and the Caribbean region through the first half of 2021, projects the continuation of an upward trend in the region's exports for the rest of the year, despite some signs of a slowdown. 
• Trade recovery was primarily driven by increases in prices (17.6 per cent) and in quantities to a lesser extent (11.5 per cent), but the volume of external shipments has not yet returned to pre-pandemic levels, the report stated.

(Source: IDB)

• U.S. personal spending rose in October from a month earlier by the most since March, while a closely watched inflation measure posted the largest annual increase in three decades. 
• Purchases of goods and services, unadjusted for changes in prices, increased 1.3% following a 0.6% gain in September, Commerce Department figures showed Wednesday. After adjusting for higher inflation, spending rose a healthy 0.7%. 
• The personal consumption expenditures price gauge, which the Federal Reserve uses for its inflation target, rose 0.6% from a month earlier and 5% from October 2020. The figures come as some Fed officials are advocating for a faster tapering of the central bank’s asset-purchase program than initially planned.

(Source: Bloomberg)