• Eppley Caribbean Property Fund Limited SCC – Value Fund (“ECPF”) announced that it is acquiring two industrial properties in Kingston, 105-107 Marcus Garvey Drive, and 693 Spanish Town Road.
• ECPF has completed the acquisition of 105-107 Marcus Garvey Drive, a 3.4-acre parcel of land located in New Port West containing two buildings, including a cold storage facility, totaling over 86,000 square feet. ECPF’s acquisition was structured to have the effect of purchasing the property using 15,447,465 newly issued shares as consideration at price equivalent to its NAV per share. The property is fully tenanted.
• ECPF, Norbrook Equity Partners, and its partners have also jointly reached an agreement to acquire 693 Spanish Town Road, a 3-acre parcel of land with more than 75,000 square feet of warehouse space. The partners have identified tenants to occupy the building and expect this acquisition to be completed in the fourth quarter.
• ECPF is the largest listed real estate mutual fund in the Caribbean and trades on the Jamaica, Barbados, and Trinidad and Tobago stock exchanges. At the completion of these acquisitions, ECPF will own 13 buildings in Jamaica and Barbados comprising over 670,000 square feet.

(Source: JSE)

• According to Fitch, the incumbent Jamaica Labour Party’s general election victory signals economic and fiscal policy continuity.
• The scale and efficacy of Jamaica’s coronavirus policy response remain important to sovereign credit metrics, as data from Q2 2020 and uncertainty over tourism’s recovery point to a fiscal deficit and a GDP contraction are bigger than Fitch’s most recent forecast published in July.
• The pandemic-related spending done by the Administration since the start of the year resulted in the central government expenditure increasing 5% year-over-year (yoy) from April to June, while revenues contracted 20% YoY. Fitch’s most recent FY2020/2021 deficit forecast of 2.7% of GDP assumed revenues for the full fiscal year fall 11% and GDP shrinks 5.3% in the calendar year 2020.
• Although borders reopened to international tourists on June 15, stopover arrivals in July were only 16% of those a year ago. Visitors from countries deemed high risk, including the U.S., have to test negative for COVID-19 prior to arrival. Therefore, the possibility that Jamaica misses a substantial portion of the winter vacation season is a meaningful risk to the agency’s current 2020 GDP and FY2020/2021 deficit forecasts.

(Source: Fitch Solutions)

• Fitch Solutions expects lower energy prices will flip Trinidad & Tobago’s (T&T) current account balance into deficit in 2020.
• Consequently, it has revised its current account forecasts to -4.7% and -3.7% of GDP in 2020 and 2021, from -2.6% and -3.1% previously.
• The current account deficit will shrink gradually over the coming years as rebounding natural gas prices drive modest export growth.

(Source: Fitch Solutions)

• The Covid-19 pandemic will transform Grenada’s fiscal position, as a collapse in revenues and countercyclical public spending push the budget balance into deficit in 2020 and the years thereafter.
• While it is expected that an economic rebound will support revenue growth beginning in 2021, the government will likely return to fiscal consolidation in the longer term to contain debt accumulation.
• Fitch Solutions forecasts the Grenadian fiscal deficit will be 2.4% of GDP in 2020 and 1.5% in 2021, from a 4.1% surplus in 2019.

(Source: Fitch Solutions)

• The official US unemployment rate fell to 8.4% in August as businesses continued emerging from broad shutdowns imposed early in the coronavirus pandemic, the Bureau of Labour Statistics reported Friday.
• That’s the lowest rate since unemployment exploded in April, to levels unseen since the Great Depression. It would also mean the official rate dipped below the peak seen during the country’s last downturn, known as the Great Recession. 
• But the true rate in August is likely much higher than the official figure — perhaps even exceeding 11%, according to labor economists. That would mean the country is still in the throes of an unemployment crisis worse than at any time in the post-Second World War era.  

(Source: CNBC)

• Oil futures clawed back some of the losses they sustained in the previous session, but a rebound in COVID-19 cases in some countries undermined hopes for a steady recovery in global demand.
• Brent crude LCOc1 was up 20 cents, or 0.5%, at $39.98 a barrel after dropping more than 5% on Tuesday to fall below $40 a barrel for the first time since June. U.S. crude CLc1 was up 42 cents, or 1.1%, at $37.18 a barrel, having fallen nearly 8% in the previous session.
• “Short-term oil market fundamentals look soft: the demand recovery is fragile, inventories and spare capacity are high, and refining margins are low,” Morgan Stanley said.
• Yet, the bank raised its Brent price forecast slightly higher to $50 a barrel for the second half of 2021 with the dollar weakening and rising inflation expectations, it said.

(Source: Reuters)

• Sygnus Credit Investments Limited’s (SCI) audited net profit for the financial year ended June 30, 2020, declined by 3.8% (or US$0.78Mn) year over year to US$1.97Mn (EPS: US0.56¢).
• The drop in the Group’s bottom-line was primarily driven by a 100.9% (or US$1.32Mn) increase in expenses, which outweighed the 36.3% (or US$1.22Mn) growth in total income. Further, the rise in expenses was largely influenced by a 374.6% (or US$0.82Mn) expansion in net foreign exchange losses and a 42.3% (or US$0.30Mn) increase in management fees.
• Although SCI had record origination of private credit investments across the Caribbean region, the results were adversely impacted by the one-off conversion of J$1.20Bn to USD. This J$1.2Bn was a combination of part proceeds of new JMD debt that was raised, and part proceeds of JMD investments that were exited during the third quarter.
• The results were also impacted by the one-off unscheduled investment exit of US$10.30Mn during the third quarter, sparked by the onset of COVID-19.
• The company’s stock price has declined by 40.8% since the start of the year, closing Thursday’s trading session at $15.39. At this price, the stock currently trades at a P/E of 19.9x earnings, which is above the Main Market Financial Sector Average of 17.0x.

(Source: SCI Financials)

• Fitch Solutions believes Mexico’s political environment faces a difficult decade owing to high levels of income inequality, endemic corruption and a weak security situation.
• The country’s ability to recover from the Covid-19 pandemic and to improve living standards will be crucial to avoiding social unrest in the years ahead.
• In addition, the policy direction pursued by nationalist-populist President Andrés Manuel López Obrador (AMLO), whose term runs through 2024, will play a large role in determining Mexico's progress on improving its political risk.

(Source: Fitch Solutions)

• Industry experts have stated that the resumption of the arrival of cruise ships in Costa Rica is uncertain as the market has just commenced reactivation and is currently testing its health protocols against Covid-19.
• Shipping companies like Aqua Expeditions will return to the Amazon this month and Windstar Cruises is expected to sail to the Caribbean in the fall. Princess would return in mid-December, but giants like Carnival and Holland are going through financial problems that will hinder their immediate return.
• According to the Costa Rican Chamber of Tourism, the Costa Rican Association of the Cruise Industry and the Association of Travel Agencies, the resumption of tourist arrivals via cruise ship could be between November 2020 and January 2021. The most optimistic forecast relates to Royal Caribbean’s return to sea in November, however, there is no certainty that Costa Rica will be among its first routes.

(Source: The Costa Rica News)

• Nonfarm payrolls increased by 1.37 million in August and the unemployment rate tumbled to 8.4% as the U.S. economy continued to climb its way out of the pandemic downturn.
• The unemployment rate was by far the lowest since the coronavirus shut down in March, according to Labour Department figures released Friday. An alternative measure that includes discouraged workers and those holding part-time jobs for economic reasons also fell to 14.2% from 16.5% in July and 22.8% at the peak in April.
• Economists surveyed by Dow Jones had been expecting growth of 1.32 million and the jobless rate to decline to 9.8% from 10.2% in July.

(Source: CNBC)