• The eurozone economy ended 2024 in a fragile state, according to a survey that showed overall activity contracted for a second straight month in December as a modest recovery in the services industry failed to offset a deeper downturn in manufacturing.
• HCOB's¹ final composite Purchasing Managers' Index for the bloc, compiled by S&P Global and seen as a good gauge of overall economic health, rose to 49.6 in December from November's 48.3. That was just above a 49.5 preliminary estimate but still below the 50-mark separating growth from contraction. Due to the holiday season, the data were collected earlier than usual, with the survey conducted Dec. 5-18.
• The headline index was boosted by the bloc's dominant services sector, whose PMI bounced back above breakeven to 51.6 from November’s 49.5 but was weighed down by a sharper decline in factory activity.
• An index measuring new services business, a proxy for demand, nudged back into growth territory after three months of decline. It was 50.2 last month, up from 48.1 in November. That was despite a rise in overall prices charged as firms tried to recoup a sharper increase in input costs. The composite output prices index rose to a four-month high of 52.5 from 51.9.

_______________________________
¹Hamburg Commercial Bank, which sponsors the Purchasing Managers' Index (PMI) for the Eurozone. The PMI data is compiled by S&P Global and provides insights into the economic health of the region by surveying business activity in both the manufacturing and services sectors.

(Source: Reuters)

• Trade between India and Jamaica has seen a significant boost, with a 25% increase over the past year, highlighting the strengthening economic partnership between the two nations. 

• Shullette Cox, President of Jamaica Promotions Corporation (JAMPRO), noted that the bilateral trade reached $116Mn during the fiscal year 2023/2024, reflecting the ongoing growth of the relationship.

• Cox delivered these remarks at a business and ethics event held on the picturesque lawns of India House, located on East King’s House Road in Kingston. The event showcased the deepening relationship between India and Jamaica, highlighting the exciting growth in trade and the strengthening of diplomatic and business connections between the two nations.

• According to Cox, over the last few years, JAMPRO has welcomed four delegations from India, as well as facilitated the International Start-up Fund Global CXO Summit, held in June. She said discussions at the summit, “opened new doors for strategic partnerships,” noting that over the past year, JAMPRO facilitated two investment projects with Indian partners, one in digital services and the other in agriculture.

• The continuation of discussions regarding a potential Jamaica-India co-production treaty is anticipated which would facilitate greater collaboration between Jamaican and Indian producers, enabling them to jointly explore and share the stories of their intertwined history and heritage.

(Source: Caribbean National Weekly)

• Barita Investments Limited (“BIL”) has announced that its parent company, Cornerstone Group, is embarking on a corporate reorganisation to comply with the Banking Services Act of 2014 (“BSA”).

• This act requires that financial groups are organised to facilitate consolidated supervision by the Bank of Jamaica (BOJ), which requires that regulated entities be structured under a Financial Holding Company (FHC) which must be licensed by the Bank of Jamaica.

• Pursuant to the requirements of the BSA, the primary purpose of the Schemes of Arrangement is to facilitate the reorganisation of the Regulated Companies (as defined herein) within the Group under one holding company i.e. the (FHC) to enable consolidated supervision by the BOJ.

• Under the proposed new structure, Cornerstone Trust & Merchant Bank Limited (CTMB), Barita and Barita Unit Trusts Management Company Limited (“BUTM”), will be held under the FHC, i.e. Barita Financial Group Limited (“BFGL”), all together constituting the Regulated Companies.

• BFGL was incorporated in Jamaica on September 15, 2023, to serve as the FHC and hold the other Regulated Companies as outlined in the Schemes of Arrangement. Once the Schemes are completed, BFGL will become the parent company of these entities. Under the Schemes, the FHC was set up as a subsidiary of Cornerstone Financial Holdings Limited (CFHL), which will be the ultimate holding company of the Group after the reorganisation.

(Source: JSE)

• Some 302,000 migrants, mostly Venezuelans, crossed the Panamanian jungle of Darién in 2024 on their way to the United States, 41.0% less than the previous year, Panamanian President José Raúl Mulino announced on Thursday.

• The Panamanian jungle has become a corridor for migrants who, from South America, try to reach the United States. Most of them are Venezuelans, although there are also Colombians, Ecuadorians, Chinese, and Haitians, among others. 

• The Panamanian government attributes this decrease to the closure of some paths in the jungle and to the help of Washington, which finances the repatriation flights of migrants through an agreement signed in July. With this program, which includes a US contribution of six million dollars, Panama has deported more than 1,500 migrants on about forty flights to Colombia, Ecuador, and India.

• However, this measure does not include Venezuelans, whom Panama allows to continue towards the United States since Caracas does not allow the arrival of flights from the Central American country. 

• There is a “logistical problem with Venezuela, but its migrants advance towards the north of Central America as appropriate and, of course, respecting all their human rights,” said Mulino. The Panamanian president stated on December 19 that in 2024 at least 55 migrants died and 180 children were abandoned while crossing the Darién.

(Source: Tico Times)

• CariCRIS has upgraded the Government of Barbados’ (GOB’s) sovereign issuer credit ratings by one notch to CariBBB (Regional Scale Local Currency), indicating an adequate level of creditworthiness relative to other Caribbean obligors.

• The upgrade reflects significant improvements in GOB’s credit risk profile, including a decline in the debt-to-GDP ratio, which fell to 105.6% in September 2024 from 108.7% a year earlier and 120.7% in 2022, strong, broad-based GDP growth, led by tourism, business services, and construction activities. 

• The positive rating also considers Barbados’ tourism arrivals exceeding pre-pandemic levels, with continued momentum expected, and the successful completion of the IMF’s Extended Fund Facility (EFF) and subsequent access to the Resilience and Sustainability Trust (RST) programme, reflecting Barbados’ strong commitment to IMF benchmarks.

• The primary balance improved to 4.0% of GDP as of September 2024, ahead of expectations, and is projected to remain robust in the medium term. Additionally, gross international reserves are very strong, providing more than seven months of import cover and external debt repayment support. The stable outlook reflects a balance between expected primary surpluses to manage debt and modest medium-term economic growth.

(Source: CariCris)

• Initial applications for US unemployment capped 2024 at an eight-month low, reflecting the relatively muted levels of job cuts in a labour market that has remained surprisingly resilient.

• New claims fell by 9,000 to 211,000 in the week ended December 28, 2024, lower than all but one estimate in a Bloomberg survey. Meanwhile continuing applications, a proxy for the number of people receiving benefits, also fell to a three-month low of 1.84 million in the week ended December 21, 2024, according to Labor Department data released Thursday, January 2, 2025.

• The current levels for initial claims are subdued, in line with their pre-pandemic levels, and consistent with a job market where companies are generally holding onto their workers.

• The report added to a recent raft of upbeat economic data, including consumer spending, in reinforcing the Federal Reserve's projections for fewer interest rate cuts this year. Labour market resilience is keeping the economic expansion on track.

• The US labour market is ending the year in what Federal Reserve Chair Jerome Powell described last month as a “solid shape.” A spike in the unemployment rate over the summer had raised alarms, prompting policymakers to cut interest rates by a half-percentage point in September to help support employment. 

• More recent data have pointed to a labour market that is moderating but remains broadly solid. It is cooling, but not in a way that would raise concerns, Powell said at a press briefing in mid-December following Fed policymakers’ decision to lower rates for the third time in three months.

(Source: Reuters & BNN Bloomberg)

• Chinese electric vehicle (EV) makers have followed market leaders Tesla and BYD in extending buying incentives to the start of 2025, as a price war  in the world's largest auto market continues for a third year. 

• The incentives are intended to encourage purchases of Chinese vehicles before the government subsidy schemes for the new year start. More than 5.2 million cars sold as of mid-December had benefited from Chinese government subsidies. 

• China has signalled an extension of consumer goods trade-ins in 2025, but specifics for the policy implementation nationwide remain unclear. Nanjing, the capital city of eastern China's Jiangsu province noted that it would continue to provide subsidies of up to 4,000 yuan per car purchase this year. 

• United States EV champion BYD, which could have outsold Ford, and Honda, globally in 2024, has been offering discounts of up to 11.5% on two models - one hybrid and one EV - since December. While, Tesla, which sparked the price war last year, has extended a 10,000 yuan discount on outstanding loans for its best-selling Model Y in China until the end of this month. 

• Sales of EVs and plug-in hybrids, known collectively as new energy vehicles (NEVs) in China, surpassed 10 million units last year, thanks to government-subsidised trade-ins of up to 20,000 yuan apiece for NEVs. Nonetheless, autos-related retail sales contracted by 0.7% year-on-year in the first 11 months, versus a 3.5% increase in China's total retail sales, official data showed, pointing to the impact of price cuts.

(Source: Reuters) 

• Data from the Statistical Institute of Jamaica (STATIN) revealed that real value added (RVA) for the Jamaican economy contracted by 3.5% in the third quarter of 2024 (Q3 2024) compared to Q3 2023. The 3.5% contraction was due to declines in the Services and Goods Producing Industries of 2.2% and 7.2%, respectively, and was deeper than the 2.8% dip estimated by the Planning Institute of Jamaica (PIOJ).
• Hurricane Beryl’s July 2024 landfall was a major reason for the Q3 2024 economic contraction, especially for goods-producing industries. Most notably, the Agriculture, Forestry & Fishing industry was affected by heavy rains and wind, which damaged mature crops, hindered harvesting, and delayed planting. The Mining & Quarrying industry was also affected by significant damage to one of the major alumina-producing plants.
• Beryl also negatively impacted the performance of both the Electricity and Water Supply and Other Services industries. Damage to the island’s energy infrastructure delayed power restoration across several parishes and reduced electricity and water consumption.
• As a result, RVA declined in all the Goods Producing Industries. Agriculture, Forestry, & Fishing fell by 12.5%, Mining & Quarrying (17.4%), Manufacturing (4.0%), and Construction (3.3%).
• Furthermore, the RVA for most service industries contracted in Q3 2024. ‘Wholesale & Retail Trade, Repairs, Installation of Machinery & Equipment’ (-3.0%), Hotels & Restaurants (-6.2%), ‘Real Estate, Renting, & Business Activities’ (-3.2%), Producers of Government Services (-0.5%) and Other Services (-6.5%) all contracted. However, Finance & Insurance Services (+0.8%) and ‘Transport, Storage & Communication increased’ by (+2.5%).
• Relative to Q2 2024, the economy contracted by 1.8%, reflecting declines in both the Goods-Producing (4.5%) and Services (0.8%) Industries.
• Following the Q3 contraction, Jamaica’s economic outlook for Q4 2024 is negative due to the lingering effects of Hurricane Beryl, Tropical Storm Rafael, heavy rainfall and the U.S. State Department’s Level 3 Travel Advisory. Considering these after-effects, the PIOJ expects economic growth measured by Real GDP to fall within the range of -1.5% to 0.0%. If Jamaica’s economy contracted for a second consecutive time in Q4 2024, it would meet the technical definition of a recession.

(Sources: STATIN & NCBCM Research)

• The Jamaica Stock Exchange (JSE) announced that it has decided to immediately suspend trading in the shares of MFS Capital Partners Limited (MFS). JSE’s decision is in keeping with its rules^[1] that state that “A Junior Market company shall submit its audited financial statements… within 90 days of the end of the reporting year” and “… its financial statements … within 45 days of the end of the reporting quarter”.
• MFS Capital Partners Limited (MFS) failed to submit its audited financial statements for the year ended June 30, 2024, to the JSE. The Company’s 2024 audited financial statements was due on September 28, 2024, and is ninety-three (93) days overdue as at December 30, 2024.
• MFS also failed to submit its 1st Quarter Unaudited Financial Statements for the period ended September 30, 2024, which was due on November 14, 2024. As of December 30, 2024, the 1st Quarter Report is forty-six (46) days overdue.
• This suspension follows at least five prior suspensions issued earlier in the year, underscoring the JSE's ongoing efforts to uphold and enforce its regulatory framework.

(Source: JIS)

 ^[1] Junior Market Rule Appendix 2, Part 4 (2) (e) – Audited Annual Financial Statements and JSE Junior Market Rule Appendix 2, Part 4 (1) (e) Quarterly Financial Statements.

• The Dominican Republic has made significant strides in its reforestation efforts, marking a substantial increase in forested areas over the past decade. According to the 2024 Environmental Statistics Yearbook released by the National Office of Statistics (ONE), the country has expanded its reforested land by a remarkable 829%, from 14,126 hectares in 2013 to an impressive 131,338 hectares in 2023.
• The year 2023 witnessed the highest level of reforestation, surpassing previous records set in 2019 and 2013. However, the report also highlights fluctuations in reforestation rates, with declines observed in 2021 and 2022 primarily due to limited availability of imported seeds and prolonged droughts.
• To accelerate these efforts, the Dominican government launched the National Reforestation and Ecosystem Restoration Plan in June 2023. This ambitious initiative aimed to plant 20 million seedlings across 320,000 hectares within two years, to restore degraded forest ecosystems. To date, the plan has achieved a commendable 82% of its target.
• Looking ahead, the government is committed to expanding reforestation efforts even further. José Elías González, Vice Minister of Forest Resources, announced plans for a second phase of the reforestation program, aiming to cover an additional 5,000 square kilometres of the country. While this ambitious goal presents significant challenges, including securing adequate funding, the government is determined to press forward.
• The Dominican Republic’s reforestation efforts not only contribute to environmental conservation but also offer numerous socioeconomic benefits. By protecting watersheds, reducing soil erosion, and enhancing biodiversity, these initiatives support sustainable development and improve the livelihoods of local communities.

(Source: Dominican Today)