• Monday, the Inter-American Court on Human Rights opened its 166th Regular Session at the University of the West Indies at Cave Hill, Barbados, where it will be taking up the issue of the climate emergency, and the response in the framework of international human rights law.
• More than 60 delegations from around the globe, including experts on human rights and climate change and from academia and non-governmental organizations, are participating in the session, hosted by the government of Barbados. The Inter-American Court of Human Rights will hold a public hearing on a request for an advisory opinion on climate change and human rights.
• The request for an advisory opinion for clarification on the scope of governments’ obligations in responding to climate change was requested by Colombia and Chile. The countries noted that both are experiencing the daily challenge of dealing with a proliferation of droughts, floods, landslides and fires.
• Still, climate effects are not being felt uniformly leading to the effort to gather diverse opinions on governments’ obligations to their populations. A similar information-gathering effort is being carried out by the International Tribunal of the Sea and the International Court of Justice, said Pablo Saavedra Alessandri, registrar of the Inter-American Court of Human Rights.
• Overall, the hope is that the Inter-American Court of Human Rights will issue an advisory opinion that would guide the climate and energy policy of many countries in Latin America and the Caribbean.
• In an amicus brief submitted last year, Earthjustice urged the court to outline specific obligations for governments to mitigate climate change, including phasing out fossil fuel production and promoting a just transition to clean and renewable energy.

(Source: Miami Herald)

• Rising food prices around the world may finally be seeing a bottom this year. According to Oxford Economics, global food prices are expected to decline in 2024, offering some relief for shoppers. “Our baseline forecast is for world food commodity prices to register an annual decline this year, reducing pressure on food retail prices further downstream,” the economic advisory firm wrote in a recent note.
• The key driving force behind the decline in food commodity prices is the “abundant supply” for many important crops, especially wheat and maize.
• Bumper harvests in recent months for both staple crops led to a steady decline in prices. Wheat futures have also fallen almost 10% year-to-date, while maize futures lost about 6% over the same period, according to FactSet data.
• Farmers ramped up production of both wheat and corn grains following higher prices after Russia began its invasion of Ukraine in 2022. As a result, global maize harvests for the marketing year ending August this year are likely to come in at record levels, according to Oxford’s analysis. Wheat harvests are also forecast to come in high, although slightly lower than the record level in marketing year 2022 to 2023, the Oxford report said.
• Supply pressures of grains in Russia and Ukraine have also eased. Despite the collapse of the Black Sea Grain initiative in July last year, Ukrainian agricultural exports have been holding up well, Oxford Economics’ Lead Economist Kiran Ahmed wrote. Russian wheat exports have also been flooding international markets, keeping prices low, he added.

(Source: CNBC)

• U.S. business activity cooled in April to a four-month low, due to weaker demand, while rates of inflation eased slightly even as input prices rose sharply, suggesting some possible relief ahead as the Federal Reserve looks for signs that the economy is ebbing enough to bring inflation down further.
• S&P Global said on Tuesday that its flash U.S. Composite PMI Output Index, which tracks the manufacturing and services sectors, fell to 50.9 this month from 52.1 in March. A reading above 50 indicates expansion in the private sector.
• The slowdown reflected weaker rates of growth in both the manufacturing and services sectors, with activity easing to three- and five-month lows, respectively. That in turn meant employment, which the Fed is watching closely for indications of a drop off, fell for the first time since June 2020, with the reduction focused on services.
• The survey suggested that the economy lost momentum at the beginning of the second quarter compared to the January-March quarter. According to a Reuters survey of economists, GDP likely increased at a 2.4% annualized rate last quarter.
• The S&P Global survey's measure of new orders received by private businesses dropped to 48.4 from 51.7 in March, the first decline in six months, while its measure of prices paid for inputs declined to 56.5, off the six-month high of 58.7 reached in March, but still a solid rate. The output prices gauge fell to 54.1, off the ten-month high of 56.4 recorded in March, but also still elevated.
• In a reversal of trends seen last year, when wage-related services sector price pressures intensified while manufacturing input costs cooled, higher raw material and fuel prices resulted in the fastest rise in manufacturing input costs in a year in April, with manufacturing now recording steeper inflation increases in three of the past four months. Service providers, by contrast, reported the second-lowest overall cost increase in three and half years.
• Manufacturing entered contraction territory, with the survey's flash manufacturing PMI slipping to 49.9 this month from 51.9 in March. New orders shrank slightly while growth in employment slowed, albeit modestly, and supply chains showed signs of spare capacity. The survey's flash services sector PMI dipped to 50.9 in April from 51.7 in the prior month.

(Source: Reuters)

• The Jamaica Agricultural Commodities Regulatory Authority (JACRA) will be seeking to facilitate an increase in the production of regulated agricultural commodities (RACs) by at least 20% in the 2024/25 fiscal year, according to the Jamaica Public Bodies Estimates of Revenues and Expenditure for FY 2024/25.
• The increased production is expected to fill supply gaps in the hospitality, food service and agro-processing industries.
• JACRA also aims to facilitate an increase in support systems for market access to regional and international markets. “This is expected to result in a 10% increase in the number of farmers who have access to these markets,” the document stated. The Authority will achieve these objectives by facilitating capacity-building activities for farmers, training and encouraging linkages between farmers and agro-processors.
• The Authority will also be promoting the utilisation of climate-smart technologies by Jamaican farmers, fishers, fish farmers, miners and entrepreneurs in the agriculture and minerals sector.
• JACRA was established for the development, regulation, promotion and standardisation of the agricultural commodities industry and for connected matters.
• Notably, given forecasts that the next 5 years are expected to bring the highest temperatures on record along with the vulnerability of the country’s agricultural production, and by extension inflation, to drought and climate change, the promotion of climate-smart agricultural practices by the authority is a step in the right direction.

(Sources: JIS and NCBCM Research)

• On April 17, 2024, Express Catering (ECL) celebrated the listing of its 8.5% US fixed rate senior unsecured bond at the Jamaica Stock Exchange. Through this bond offer, ECL raised US$12.2Mn, the largest bond offer by a company listed on the Junior Market. This was the first bond listing on the Junior Market for the year.
• Speaking at the listing, Dr. Marlene Street Forrest, Managing Director of the Jamaica Stock Exchange in her Welcome, congratulated the company on its achievements and its contribution to the growth of the capital market.
• “Let me congratulate ECL on the fact that out of the 515 account holders of the bond, 405 (78%) were shareholders, which speaks volume to the confidence that shareholders have placed in the company. This represents a significant measure of the company’s growth and sustainability as the company has the opportunity to tap into their shareholder base for additional funding when required,” she said.  
• She continued by stating that she was delighted that, the ratio of female to male is a little skewed towards the female with 51% female and 49% male participants in the bond offer. This she said signified a growth in female account holders and equity in investment in the market.
• According to Mr. Ian Dear, CEO of Express Catering Limited, “Tourism in Jamaica, which 98% of our customers are tourists coming through the Sangster International Airport, will continue to grow in Jamaica by all intents and purposes. The current trajectory of new hotel rooms and the interest in Jamaica as a destination bodes well for continued growth,” he said.
• He added that, “we are right now trending almost 10% above 2023 in our arrivals as a country and so we are very encouraged by what the future holds and ECL stands to benefit from that entire growth.”

(Source: JSE)

• Moody's has given the Bahamian Government’s fiscal consolidation campaign a major boost by predicting that this year’s fiscal deficit will only narrowly overshoot its target by $44Mn.
• The credit rating agency forecast that improved revenues and “spending restraint” will contain the deficit for the 2023-2024 fiscal year to a sum equivalent to just 1.2% of economic output of gross domestic product (GDP). (The Bahamas' fiscal year runs during the period of July 1 to June 30, each year)
• If Moody’s projection turns out to be accurate, the GFS (Government Finance Statistic) deficit will be only slightly higher than the $131Mn, or 0.9% of GDP, that the Davis administration targeted when unveiling its Budget last May. The rating agency’s latest deficit forecast, based on that Budget, is equal to $174.67Mn or a near $44Mn overshoot if it holds and comes true.
• Moody’s also shrugged off the fact that the Government’s fiscal deficit was almost double the full-year target halfway through the 2023-2024 Budget year.
• “According to data as of the first six months of the fiscal year 2023-2024, The Bahamas recorded a fiscal deficit equal to $258.7Mn or 1.9% of its GDP,” Moody’s said in its credit update. “Even though the deficit exceeded the target for the first six months of the fiscal year, there were signs of fiscal consolidation.”
• “We expect improvement in revenue collection and continued restraint on spending will allow the Government to come close to the annual target of 0.9% of GDP. We forecast a slightly larger deficit in fiscal 2024, 1.2% of GDP, reflecting moderate slippage vis-à-vis the Government’s fiscal targets,” Moody’s noted.
• The Davis administration will likely seize on Moody’s update as the first affirmation from an external source that it is close to achieving its projected fiscal targets, especially as the rating agency is forecasting it will achieve its long-cherished goal of moving from deficit to a Budget surplus equal to 0.5% of GDP (around $65.5Mn) in the upcoming 2024-2025 fiscal year.

(Sources: The Tribune & Moody’s Investor Services)

• Chilean President Gabriel Boric told a major copper industry conference he expects production at state-run miner Codelco to grow slowly this year and reach 1.7 million metric tons by 2030, and that he sees copper prices rising.
• Notably, driven by renewed interest in commodity assets, copper prices rallied 10% since the start of this year on the London Metal Exchange. Copper prices also hit a record high on the Shanghai Futures Exchange (Shfe) and neared a two-year high of $4.34 per pound last Friday on the Chicago Mercantile Exchange. However, when prices hit $4.50 per pound, it could start to hurt copper demand, analysts believe.
• "The Codelco production will rebound," he said, offering a vote of confidence for the country's top copper producer, whose output last year hit a quarter-century low, at 1.325 million metric tons. Notably, Codelco is aiming to produce between 1.325 million and 1.390 million metric tons of copper this year,a target that at best would see it lightly overtake its 2023 output.
• At a time when global companies have raised concerns about long approval times for new mines and expansions, he said Chile, the world's biggest copper producer, is dedicated to speeding up the permitting process for mining projects.
• He also stressed the need for greater economic distribution of mining industry profits to local communities. Boric also said one of Chile's strong suits was ensuring long-term security for investors.
• Chile’s economy is at a crossroads. Strong policies have successfully brought down high inflation and reduced the large current account deficit that emerged during the pandemic. Increases in social benefits have provided some relief in response to discontent over inequality. However, investment and growth are still tepid and social gaps remain high. Overall Chile is expected to grow by 1.9% in 2024, up from an estimated 0% growth in 2023.

(Sources: Reuters & the International Monetary Fund)

• The European Union will be marginalised if it continues to shrink compared to other parts of the world; however, two former Italian prime ministers, Enrico Letta and Mario Draghi, are proposing remedies. While anxious leaders welcomed Letta’s report about how to improve the bloc’s single market at their summit last week, they may lack the will to drink the necessary medicine.
• There are two ways of looking at the EU’s relative decline. The first is in terms of living standards. Here, what matters is not that developing countries, led by China and India, have been dragging themselves out of poverty in recent decades and so closing the gap on Europe, says Erik Nielsen, UniCredit’s chief economic advisor. Rather, it is that the EU has not been moving ahead as fast as the United States.
• EU income per head has grown 55% since the single market was created in 1993 when measured on a purchasing power parity basis. That’s not far behind the 65% gain enjoyed by the average American.
• However, the EU has only kept up because new members, such as Poland, have expanded very fast: that country’s income per head has almost quadrupled. By contrast, income per person in the bloc’s bigger and older members — Germany, France and Italy — is up only 37%, 35% and 20%, respectively, over the same period.
• The other way of looking at the region’s relative decline is in terms of power. Back in 1992, the EU was a geoeconomic giant. With 29% of global output and a strong position in leading technologies, it could set many world standards.
• By 2022, the bloc’s share of world output had shrunk to only 17% while the U.S. share was stable at 25% over the same period. What’s more, the EU now has only four of the world’s top 50 technology companies, Draghi noted in a speech last week.
• The EU’s relative economic weight is not just declining because other regions’ living standards are growing faster. Its currency has weakened, and its population is stagnant. This would not matter if the post-war global economic and political order was intact. But Russia has invaded Ukraine, while both China and the United States are undermining the world trading system. The EU is worried that it will be bullied by larger rivals.

(Source: Reuters)

• Bank of England Chief Economist Huw Pill said on Tuesday that interest rate cuts remained some way off, even if the passage of time and an absence of bad news on inflation had brought them closer.
• Pill said there were greater risks from cutting the Bank Rate too quickly, rather than too late - a view that grounded his cautious approach to policy, despite signs of a reduction in inflation pressures. Consequently, investors reduced their bets that the BoE will cut rates in the coming months as Pill spoke, with the central bank's August meeting no longer fully priced in as the starting point.
• "The combination of little news and the passage of time have brought a Bank Rate cut somewhat closer," Pill said in a speech at the London campus of the University of Chicago Booth School of Business. "But the same lack of news gives me no reason to depart from the baseline that I already established," Pill added, saying that he stuck with his view in a March 1 speech that "the time for cutting Bank Rate remained some way off".
• Pill, seen as a centrist on the Monetary Policy Committee, declined to comment on whether markets were right to be focused on an August rate cut, and said it was right to maintain a restrictive stance for interest rates.
• "Economic growth in the UK has resumed, albeit at a modest rate, over the past few months following the technical recession we experienced in the second half of last year. And today's survey data certainly supports that view," Pill said.
• Although inflation looks set to fall below the BoE's 2% target in the coming months, Pill warned against getting "too excited" about this, given it would likely rise again as the year progresses. Markets had previously bet on slightly earlier BoE rate cuts after Deputy Governor Dave Ramsden said last week he thought inflation might hold at 2% rather than rise.
• Finally, Pill said the BoE could move policy independently of the U.S. Federal Reserve and the European Central Bank, the latter of which looks likely to cut interest rates in June. He also welcomed the findings of former Fed chair Ben Bernanke's report into the BoE's forecasting processes. However, he cautioned against expectations that the Bernanke report will lead to a rapid change in how UK monetary policy is presented.

(Source: Reuters)

• Minister of Foreign Affairs and Foreign Trade, Senator the Hon. Kamina Johnson Smith, noted that total trade between Jamaica and the Dominican Republic has increased by 161% over the last 10 years.
• This, however, has been largely driven by exports from the Dominican Republic to Jamaica. “But we are, as Jamaicans, also determined to continue to increase our exports, which are trending in the right direction to the Dominican Republic, as we also take advantage of the excellent opportunities in that market and seek mutually beneficial and balanced trade relations,” Senator Johnson Smith said.
• She was speaking during the second Dominican Republic-Jamaica Business Forum at the AC Hotel by Marriott Kingston on Thursday (April 18).
• Senator Johnson Smith noted that the forum serves to complement several private-sector-driven mechanisms and initiatives being instituted or recently put in place to forge greater economic ties between the countries.
• These, she pointed out, include a memorandum of understanding (MOU) between JAMPRO and ProDominicana to formalise trade and investment promotion and cooperation between Jamaica and the Dominican Republic. An MOU was also concluded between the Private Sector Organisation of Jamaica (PSOJ) and the Consejo Nacional de la Empresa Privada to promote trade and investment and commercial development.
• The initiatives mentioned will provide various platforms for companies in both countries to build and strengthen the ties between the nations for mutual economic benefits.

(Source: JIS)