• Another request for a proposal for a further 168 megawatts of renewable energy will be launched in the new fiscal year, which begins on April 1. This is in addition to the supply of up to 100 megawatts of electricity generation, for which the Generation Procurement Entity invited tenders last September.
• The disclosure was made by Governor-General, His Excellency the Most Hon. Sir Patrick Allen, as he delivered the Throne Speech to open the 2024/25 Parliamentary Year in Gordon House on Thursday (February 15).
• The Governor-General said the Government continues to develop policies that will contribute to reducing Jamaica’s energy intensity and carbon footprint while advancing the adoption of new technologies.
• The policy and guidelines for energy efficiency and conservation in public facilities, particularly for schools and hospitals, and the electric vehicle policy were tabled in Parliament in June 2023.
• Efforts to diversify energy sources for public passenger vehicles for the Jamaica Urban Transit Company (JUTC) received a major boost with the acquisition of five battery electric buses, as well as 20 compressed natural gas (CNG)-fueled buses.
• Jamaica’s target for the share of renewable energy in the total grid-connected capacity mix is 50% by 2030.  The current installed capacity reaches 1,041MW, of which 83% is thermal, primarily natural gas, and the remainder is renewables (wind, hydro, and solar).

(Source: JIS)

• Under the leadership of the Honourable Dr. Terrance Drew-led administration, St. Kitts and Nevis has made significant advancements in the tourism sector during the 2023-2024 season.
• Permanent Secretary in the Ministry of Tourism, Tivanna Wharton said that substantial progress has been achieved, with notable developments and initiatives implemented to bolster the tourism industry of the nation.
• During the radio and television show ‘InFocus’ on February 14, 2024, Ms. Wharton stated that last year, the stayover visitors were approximately 133,000, noting that “this again suggests that we are well on the way to pre-COVID numbers, which is our benchmark at this time.” She continued that this success is a reflection of the work that is being done under the current administration.
• Further, Senior Minister and Minister of Economic Development and Investment, the Right Honourable Dr Denzil Douglas, during the Prime Minister's Press Conference at the NEMA Conference Room on February 13, announced the expansion of the nation’s tourism and hospitality sector through a major investment by Troy Property Investment Limited.
• Highlighting the government’s ongoing efforts to attract new investments and expand the economy, the minister underscored the recent groundbreaking for the newest addition to the country’s hospitality sector, Hotel Indigo. This development, Dr Douglas said, is set to take a step further with Troy Property Investment Limited’s plans to enhance the hotel’s offerings.
• The government of St. Kitts and Nevis remains dedicated to fostering a conducive environment for investment and development, ensuring that the twin-island nation continues to thrive as a premier destination in the Caribbean for both tourists and investors alike.

(Source: SKN Vibes)

• Mexico's headline inflation rate likely eased in the first half of February, a Reuters poll showed on Monday, reinforcing bets that the country's central bank could soon lower its key benchmark interest rate for the first time since 2021.
• A median forecast of 13 analysts predicted that the annual headline inflation rate would settle at 4.70% for the first 15 days of the month, which would mark the continuation of a downward trend that was briefly interrupted at the end of last year.
• The expected rate of rising consumer prices; however, still hovers above the central bank's target of 3%, plus or minus 1 percentage point. The closely watched core inflation index, which strips out volatile energy and food prices, is seen falling to 4.67% in early February, its lowest level since July 2021.
• The Bank of Mexico's five-member board held the benchmark interest rate at 11.25% for a seventh straight time in the last meeting, while hinting a rate cut could be considered during upcoming meetings.
• The central bank, known as Banxico, began a rate hiking cycle in June 2021, but it has held the key borrowing rate at its current record-high level since last March.

(Source: Reuters)

• Canada's annual inflation rate slowed significantly more than expected to 2.9% in January, and core price measures also eased, data showed on Tuesday, bringing forward bets for an early interest rate cut. Analysts polled by Reuters had forecast inflation to tick down to 3.3% from 3.4% in December.
• It was the first time in seven months that headline inflation has dipped below 3%. This prompted money markets to hike bets for a rate cut in April to as much as a 58% chance from a 33% chance before the figures were published. The Bank of Canada's next policy announcement is March 6, and expectations are that rates will stay on hold at a 22-year high of 5%.
• Month-over-month, the consumer price index was unchanged, compared with a forecast of a 0.4% rise, Statistics Canada said. The Bank of Canada targets inflation at 2%. Two of its three core measures of underlying inflation also edged down. CPI-median slowed to 3.3%, the lowest since November 2021, while CPI-trim decreased to 3.4%, the lowest since August 2021.
• The three-month annualized rate of the combined figures decelerated to 3.2% in January from 3.6% in the prior month. The BoC said last month its thinking had shifted to how long rates must stay at the current level. At the same time, it did not completely rule out another rate hike, citing persistence in underlying inflation.
• "The key takeaway here is that Bank of Canada can seriously consider cutting rates," Doug Porter, chief economist at BMO Capital Markets, said. The BoC projects headline inflation will remain around 3% in the first half of 2024, before cooling down to 2.5% by end-year.
• The central bank said last month that while interest rates had helped to bring down overall inflation, which touched a peak of 8.1% in June 2022, similar to the U.S., categories like shelter costs have fed underlying pressures. Shelter price inflation accelerated to 6.2% in January from 6% in December. Rental inflation continued to show upward momentum and accelerated to 7.9% in January from 7.7% in December.
• "The Bank of Canada will likely remain cautious in the face of still-strong wage gains, firm services prices, and the reality that core inflation is still holding above 3%," said Porter from BMO.

(Source: Reuters)

• Barclays, unveiling its biggest revamp since 2016, sought to appease investors seeking a clearer route to less volatile returns. However, investors said the British lender's plan to dedicate fewer financial resources to its investment bank is at odds with ambitions to expand in some of the unit's higher-risk businesses.
• Barclays has historically devoted much of its capital to investment banking, roiling more conservative shareholders who say other businesses posting more reliable profits have been under-invested as a result.
• The bank will continue to allocate the lion's share of its firepower to investment banking, and while a bigger push into domestic lending is broadly welcomed, some analysts and investors are unconvinced the bank can grow market share enough to meet its lofty revenue goals, against strong competition and a skittish UK economy.
• Barclays' long-awaited strategic update presented on Tuesday will have the bank return at least 10Bn pounds ($12.66Bn) to investors and reorganize into five units from the current three business lines, a move it said would create a simpler and better-balanced bank. This so-called "re-segmentation" aims to give investors greater transparency of performance in each division, unlike the previous structure, which reported corporate lending and investment banking revenues together, the bank said.
• In a key part of the overhaul, Barclays will reduce the share of risk-weighted assets (RWA) devoted to its investment bank to around 50% by 2026 from about 63%. In turn, the bank plans to deploy around 30Bn pounds more to its UK consumer, corporate lending, and private banking arms that generate higher returns.
• By reallocating its capital, Barclays says revenue will grow to around 30Bn pounds by 2026 from 25.4Bn pounds in 2023.
• The average returns on tangible equity (RoTE) in the businesses the bank has pledged to invest in ranged from 18% to 31% in the two years to end-2023, compared with a more modest 10% at the investment bank, company figures show.

(Source: Reuters)

• Building on the momentum gained from the A.S. Bryden Holdings (ASBH) acquisition in June 2022, Seprod reported $5.45Bn in net profit attributed to shareholders for the year ended December 2023, an 86.8% surge (or $2.53Bn) in profitability compared to the prior year.
• Revenues amounted to $113.04Bn, a substantial 44.1% (or $34.61Bn) increase, compared to the $78.43Bn in 2022. The acquisition of a majority shareholding in A.S Bryden in June 2022 significantly influenced the Group’s 2023 results. Notably, the inclusion of 12 months of ASBH results compared to 7 months in 2022 has bolstered overall performance.
• The business also benefited from a 45% increase in export sales and significant progress in the modernisation of its margarine plant, leading to enhanced availability of key shortening and margarine products.
• However, direct expenses jumped 50.4% (or $28.3Bn), causing the gross margin to fall to 25.3% of revenues from 28.4% in 2022. The growth in costs was directly associated with the increased revenue generation as well as higher commodity prices. 
• Despite the prevailing uncertainties in the operating market, management is maintaining a positive outlook for the company and remains focused on several strategic initiatives aimed at delivering outstanding results. These initiatives include deepening technology integration across the business to drive efficiency and productivity, targeting growth in exports by at least 40%, prioritising the upskilling of human capital, and extracting synergies from the ASBH acquisition.
• After rising 13.7% in 2023, Seprod’s stock price has appreciated a further 5.0% since the start of 2024 and closed Monday’s trading session at $83.70 per share. At this price, the stock trades at a P/E of 23.0x, which is above the Main Market Distribution & Manufacturing sector average of 15.6x.

(Sources: JSE & NCBCM Research)

• The Government of Jamaica is proposing to spend a total of $1.3Tn for fiscal year 2024/25. This represents Jamaica’s largest budget in history. Minister of Finance and the Public Service, Dr. the Hon. Nigel Clarke, made the disclosure as he tabled the Estimates of Expenditure in the House of Representatives on Thursday (February 15).
• Clarke said the funds are allocated across the main expenditure categories comprised of non-debt recurrent expenditure of $769.9Bn, capital expenditure of $80Bn, and debt service of $491.2Bn. Included in the non-debt recurrent expenditure are allocations for recurrent programme expenses at $327.8Bn, as well as compensation expenses at $442Bn.
• He further stated that “the compensation allocation includes an estimated amount to conclude the implementation phase of the restructured compensation system during the fiscal year. Wages and salaries are projected to represent 12.6% of GDP in 2024/25 up from 9.2% of GDP in 2019/20.”
• The budgeted amount for debt servicing includes $173.8Bn for interest payments and $317Bn for the repayment of debts that are maturing. “The repayment of debts that are maturing, otherwise known as amortisation payments, represents an increase of 128.9% over fiscal year 2023/24, primarily due to the large maturities on both domestic and external portfolios,” Dr. Clarke stated.
• With the tabled debt service services structure, Debt to GDP is on track for 72.2% by March 31, 2023, lower than the 74% previously targeted, and is projected to be 67.2% by March 31, 2025. Dr. Clarke noted that if achieved, this will be the lowest debt ratio in well over 40 years.
• Additionally, the self-financing public bodies are programmed to undertake $96.4Bn in capital expenditure during the year, mainly through the National Housing Trust at $50.7 billion, National Water Commission – $10.8Bn, Port Authority – $7.9Bn, Airports Authority of Jamaica – $4.7Bn, Petrojam – $3.6Bn, and Housing Agency of Jamaica – $3.2Bn.

(Source: JIS)

• Trinidad and Tobago’s headline inflation 'slowed significantly' in the second half of last year as price increases for both food and non-food items eased, and it is expected to remain low this year, the Central Bank has stated in its latest economic bulletin.
• According to data from the Central Statistical Office (CSO), headline inflation measured 0.7% (year-on-year) in December 2023, down from 4.7% in July 2023.
• Retreating inflationary conditions were evident in both food and core inflation over the six months. Food inflation declined from 8.6% in July 2023 to -1.1% in December 2023, while core inflation moderated to 1.2% in December 2023, down from 3.7% in July 2023.
• Furthermore, headline inflation is expected to remain low in 2024 based on the agency’s projection for imported inflation to be fairly low, barring fresh external shocks in energy markets and as a result of conflict-related shipping problems.
• That said, the Central Bank has warned that several factors could change the current deflationary situation, including weather conditions, possibly higher utility rates, increased cement prices, and the levy of property taxes could also lead to an uptick in domestic inflation.

(Sources: Central Bank of Trinidad and Tobago & Trinidad Express Newspaper)

• Guyana has accused Venezuela of violating international law in a dispute over a swath of oil-rich territory by expanding its military presence on their shared border despite pledging not to use force.
• Venezuela recently beefed up its military presence on the border of the oil-and-mineral-rich Essequibo region, which makes up about two-thirds of Guyana’s territory but has long been claimed by Caracas. 
• The move followed a December referendum in Venezuela in which voters backed making the region a Venezuelan state, a development regarded by Guyana as a prelude to annexation by Caracas. 
• Guyanese President Irfaan Ali and his Venezuelan counterpart, Nicolás Maduro, subsequently signed a declaration agreeing not to use force to settle the dispute.
• But satellite images published by the Center for Strategic and International Studies, a Washington think-tank, appeared to show the deployment of light tanks and armed patrol boats at Anacoco Island on the border of the Essequibo region, where Venezuela is expanding a military base to house up to 300 troops.
• Analysts say tensions are likely to remain high this year between the two countries; however, Guyanese foreign minister Hugh Todd was confident Guyana’s allies would ensure its security, saying: “In the democratic world, you will find that once you’re threatened by a failing democracy, you will not be left alone.”

 (Source: The Financial Times)

• Germany is likely in a recession now as external demand is weak, consumers remain cautious and domestic investment is held back by high borrowing costs, the Bundesbank said in a regular monthly report on Monday about Europe's biggest economy.
• The country has struggled since Russia's invasion of Ukraine pushed up energy costs, and its vast, industry-heavy economy is now in its fourth straight quarter of zero or negative growth, weighing on all of the Eurozone.
• "There is still no recovery for the German economy," the Bundesbank said. "Output could decline again slightly in the first quarter of 2024. With the second consecutive decline in economic output, the German economy would be in a technical recession."
• This weak performance has raised questions about the sustainability of the German economic model, and critics argue that much of its energy-reliant heavy industry is now being priced out of international markets, warranting an economic transformation.
• The government, however, has pushed back on gloomy projections, arguing that it is merely a perfect storm of high energy costs, weak Chinese demand, and rapid inflation that temporarily holds back growth, but does not fundamentally question economic strategy.
• Firms are also holding back investment, partly because financing costs have risen sharply since the European Central Bank pushed up interest rates to a record high to combat inflation, the central bank said. High nominal wage growth is also impacting firms, and strikes in key sectors, such as transport, could also weigh on growth in the quarter.
• While the outlook is weak, the bank said it expects no major deterioration in the labour market, which has insulated the economy so far, and Germany was not facing a broad-based, prolonged recession.

(Source: Reuters)