• iCreate Ltd’s net profit for the 6-months ending June 2021 grew by 43.8% year over year to $4.44Mn on the back of growth in other income and a decline in expenses.
• Other income improved to $5.40Mn from $30K the same period last year, while admin and general expenses fell by 34.4% (or $7.16Mn). The earnings growth was also supported by a decline in finance costs and cost of sales by 25.3% and 37.5% respectively.
• The performance was however tempered by a 39.2% drop in revenue due to the non-resumption of programs such as its Creative Training Certification which depends on practical and hands on training.
• As revenues remain below pre-pandemic levels, the company has announced several initiatives to pivot and grow. These include the addition of a new business division, iCreate Agency, which will serve as a production agency that will focus on video production, Reggae Sunsplash and other multi-media production-related activities. It also acquired an e-commerce company Mobile Edge, and entered into the commercial real estate segment through its subsidiary Creative City Subsidiary. If the company is able to generate revenues efficiently from these new activities and businesses, it could realize greater and consistent profitability in the future.
• iCreate’s stock price has appreciated by 47.8% since the start of the year and closed Tuesday’s trading session at a price of $0.87 per share.

(Source: iCreate Financials & NCBCM Research)

• Panamanian President Laurentino ‘Nito’ Cortizo will accelerate public investment in infrastructure and the COVID-19 recovery in the coming quarters, sidelining his previous pledge to advance fiscal consolidation measures.
• During his annual address to the country in July, Cortizo announced that his government would advance a US$12.0Bn public investment programme and a US$1.5Bn public private partnership (PPP) scheme to accelerate the country’s recovery from the pandemic.
• Fitch Solutions gave Panama a score of 60.0 out of 100 in its Short-Term Political Risk Index, tied for second among 17 markets in Latin America, due to the country’s favourable policymaking environment and business-friendly framework.
• While Cortizo’s embrace of expansionary fiscal measures and the country’s robust national vaccination programme will help bolster short-term stability, his longer-term plan to narrow the deficit and the potential for constitutional changes highlight key challenges once the economic impact of COVID-19 subsides.

(Source: Fitch Solutions)

• Tourism stayover arrivals in Antigua and Barbuda for the month of July have surpassed pre-covid levels, as pent-up demand for travel, has tourists flocking to the twin-island paradise during the country’s traditional low season.
• The Ministry of Tourism has announced that stayover tourism arrivals for the month came in at a high with 23,405 tourists visiting Antigua and Barbuda via the V.C. Bird International Airport. The July 2021 air arrival figures have surpassed 2019 arrivals, which during the record-breaking year for Antigua and Barbuda, stood at 23,031.
• Minister of Tourism, The Honourable Charles Fernandez said, “there has been a visible change in the travel behaviour of our visitors brought on by the COVID-19 pandemic and we continue to see a steady increase in arrivals during the summer months”.
• “July has been an extremely strong month with demand for the destination from the US Market as well as the UK market, booming, with growth above 2019 figures. We are also beginning to see an uptake from our Caribbean and Canadian market.”

(Source: The Daily Observer)

• Shoppers in the U.S. cut back their purchases in July even more than expected as worries over the delta variant of Covid-19 dampened activity and government stimulus dried up.
• Retail sales for the month fell 1.1%, worse than the Dow Jones estimate of a 0.3% decline and below the upwardly revised 0.7% increase in June.
• Excluding automobiles, sales declined 0.4%, according to Commerce Department figures released Tuesday.
• “Although retail sales fell in July, the outlook for consumer spending remains positive,” said Gus Faucher, chief U.S. economist at PNC. “However, spending growth will shift from goods to services over the next couple of years, limiting growth in most categories of retail sales.”

(Source: CNBC News)

• Despite still-robust incoming data, Fitch Solutions believes that downside pressures are building, which pose risks to their full-year growth forecast of 8.5% for China. They see risks stemming from three key areas.
• First, the recent outbreaks in China have resulted in greater restrictions, and given the lower efficacy of the Chinese vaccines, China’s zero-tolerance approach could result in stricter lockdowns over the coming weeks, which could dampen consumption.
• Second, the recent crackdown by Beijing on tech, education and gaming companies have resulted in a sharp decline in stock markets, which will weigh on investor confidence.
• Third, questions around debt sustainability for certain Chinese companies have emerged given rising bond delinquencies, which have continued to rise and could also put downward pressure on investor sentiment.

(Source: Fitch Solutions)

• The All-Jamaica Consumer Price Index (CPI) rose by 1.5% for July 2021 contributing to the 12-mth point-to-point inflation rate of 5.3%, which is an increase from the 4.3% reported in June 2021, but still within the target range. 
• A 2.3% increase in the heavily weighted index for the “Food and Non-Alcoholic Beverages” division was a major contributor due in part to an increase in the price for some agricultural produce such as yams, potatoes, lettuce, cabbage, onions and tomatoes. 
• Increases in the index for the divisions ‘Housing, Water, Electricity, Gas and Other Fuels’ (1.3 %), ‘Restaurant and Accommodation Services’ (3.2%) and ‘Transport’ (0.8 %) also contributed to the overall inflation rate. 
• Higher prices for meals consumed away from home was the main contributor to the increase in the index for the division ‘Restaurant and Accommodation Services’, while increased toll charges contributed to the rise in the index for the ‘Transport’ division. Additionally, greater electricity, water, and sewage rates influenced the increase in the index for ‘Housing, Water, Electricity, Gas and Other Fuels’ division. 
• Inflation is projected to average 4.8% over the next two years according to Bank of Jamaica. The inflation forecast anticipates that commodity (oil and grains) price inflation will accelerate in the context of global supply chain disruptions and increasing demand as economies reopen, leading to higher domestic transport and processed food inflation. However, it is expected that this will be tempered by subdued domestic agricultural food price inflation, based on expectations of favourable weather conditions.

(Source: STATIN & BOJ)

• Jamaica has welcomed its one millionth stopover visitor to arrive since its borders were reopened to international travel in June 2020, after being closed for three months due to the coronavirus pandemic. 
• Jamaica is the only English-speaking Caribbean country to have welcomed over 1.0Mn stopover visitors since the onset of the COVID-19 pandemic and has also generated just over US$1.5Bn in foreign exchange earnings from the industry since June 2020. 
• Minister Bartlett noted that the milestone achievement during a pandemic was indicative of the level of visitor confidence in Jamaica as a tourism destination, as well as the country’s health and safety protocols to contain the spread of COVID-19. He added that Jamaica has demonstrated to the global tourism market that it was managing this pandemic well. 
• The Minister highlighted that with the sector’s rebound, more than 50,000 tourism workers who were laid off due to the pandemic have been reinstated. Additionally, the Sangster Airport, which saw a decline in its labour force from 7,000 workers to the minimum staff required, has been able to recall 5,000 employees.

(Source: JIS News)

• As the Group of 7 developed nations pushes the world towards a singular, regulated tax rate, the Organization for Economic Cooperation and Development (OECD) has got Barbados to sign on to a new tax agreement that will likely result in increased taxes for companies registered here. 
• According to a statement from the Paris, France headquarters of the OECD, on Thursday, Barbados joined “the two-pillar plan to reform the international taxation rules and ensure that multinational enterprises pay a fair share of tax wherever they operate”. 
• The island joined 132 other countries and jurisdictions participating in the agreement to establish international tax reforms based on a two-pillar package. 
• After holding out, the island has finally agreed to the plan and is bringing the OECD closer to getting all 139 countries to ink the global tax plan. 
• The lack of corporate tax enticed many multinational companies to invest and operate business from the island. However, the implementation of a minimum tax will likely result in a drop in foreign direct investment which could adversely affect employment and GDP growth.

(Source: Barbados TODAY & NCBCM Research)

• Economically, the recent earthquake is likely to further suppress activity, particularly through disruptions of exports and potential contribution to inflation. While the earthquake was of a higher magnitude than the 2010 quake, which caused real GDP to contract by 5.5%, Fitch does not anticipate it will be as economically devastating, given that the economic capital of Port-au-Prince appears to have been largely spared major damage. 
• That being said, Haiti has produced extremely little macroeconomic data over the last several quarters, making it difficult to assess the economy's performance amid the COVID-19 pandemic, political upheaval and now the latest earthquake. 
• Fitch Solutions currently estimates real GDP contracted 7.4% in 2020 and anticipates a rebound of just 0.7% in 2021, although risks to this forecast appear increasingly significant. 
• Politically, the quake will further delay elections and prolong the period of leadership uncertainty. Haiti's government was already in a precarious position prior to the assassination of President Jovenel Moïse on July 7, which plunged the country further into crisis. As a result of these political developments, Fitch Solutions has revised down Haiti's score on its Short-Term Political Risk Index to 27.3 out of 100.

(Source: Fitch Solutions)

• Fitch Solutions maintains a neutral outlook on US and other Developed Market (DM) bond markets over the short term on the back of opposing factors. After having fallen between May and July, US bond yields could trade sideways within a wide range in the short term as investors weigh incoming economic data that could remain strong in the coming weeks. 
• However, at the same time, investors are still waiting for additional signals that the Fed could tighten monetary policy sooner than expected. Recent history suggests that the Fed’s chair Jerome Powell could signal a slightly more hawkish tone at the 2021 Jackson Hole Economic Policy Symposium, which will take place on August 26-28. 
• In EMs, there has been a clear gap between Asia and Latin America and emerging European countries due to epidemiological developments. The vaccine rollout in Asia has lagged significantly, resulting in restrictions being maintained across most economies and forcing central banks to maintain a dovish tone to support the economic recovery. Elsewhere, several central banks across Latin America and emerging Europe have already hiked interest rates aggressively as inflation has been rising, a trend that is likely to remain in place until end-2021. 
• In EM economies where central banks have been raising interest rates, bond yields have risen significantly the year-to-date across the curve.

 (Source: Fitch Solutions)