• Tourism Minister Hon. Edmund Bartlett stated that Jamaica is expected to welcome 4.2Mn visitors and earn US$4.1Bn by the end of the 2023/24 fiscal year.
• He noted that for 2024/25, arrivals and earnings are expected to increase to 4.529Mn visitors and US$4.8Bn, respectively, which is just about US$200Mn shy of the US$5Bn projected for the 2025/26 fiscal year.
• He refers to this as the 5x5x5 growth strategy of five million visitors and earnings of US$5Bn by 2025. For cruise tourism, Mr. Bartlett highlighted that the sector has rebounded and is back to 2019 levels in terms of projection for 2024/25 at 1.3Mn visitors.
• While there is an external factor in terms of items that are not produced in Jamaica and are imported, there is a growing energy on the supply side. Mr Bartlett noted that the budget, in its detail will speak to programmes and strategies that will be employed to strengthen the supply side.
• Part of that policy arrangement is to establish a supply logistics centre in the special economic zone, which is already in train. He further indicated that a team led by Wilfred Baghaloo, has been established and includes several of the top suppliers of tourism goods and services in Jamaica. UN Tourism is also partnering with Jamaica to establish a regional tourism academy.
• Overall, as the tourism industry continues to recover gallantly to above pre-pandemic levels, the country is expected to continue benefiting from economic revitalisation, job creation, and increased growth, signaling continued positivity for the industry.

(Source: JIS)

• Minister of Finance and the Public Service, Dr. the Hon. Nigel Clarke, says the Government will be implementing measures to ensure greater Capital Expenditure (CapEx) in the upcoming fiscal year.
• Clarke, addressing the Standing Finance Committee of the House of Representatives on Tuesday (March 5), said that the projects that fell behind in the fiscal year 2023/24 were primarily due to private-sector entities that were selected through the procurement process not being able to fulfil their obligations.
• He noted that in a couple of cases, entities were not able to post the bonds required, which means that we have to do the procurement all over. In other cases, there were failures in terms of response to the procurement; that is, the responses didn’t meet the criteria and the procurement and had to be redone.
• The Minister further noted that in addition to making some changes to the procurement processes, the primary measure that the Government will take is to be in a position where there are more projects available than budgeted capacity, which will allow more flexibility when one is falling behind.
• This is particularly important as the country runs the risk of falling behind if it cannot grow and execute its CapEx at a required rate.

 (Source: JIS)

• The Dominican Association of Investment Fund Management Companies (Asociación Dominicana de Sociedades Administradoras de Fondos de Inversión - ADOSAFI) has reported a substantial impact on the tourism sector, generating 1,274 permanent direct jobs and over 3,000 indirect jobs through investments made last year.
• As at June 30, 2023, the funds invested in the tourism sector surpassed 30,000Mn pesos, focusing on six provinces - namely National District, El Seibo, La Altagracia, Pedernales, Samaná, and Santo Domingo.
• “Investors have directed significant resources into crucial tourism projects across the Dominican Republic,” highlighted the association. These investments, ranging from the construction of new luxury resorts to the enhancement of existing tourism infrastructure, have played a pivotal role in diversifying offerings and elevating the quality of the tourist experience, as stated by Santiago Sicard, the executive president of ADASAFI.
• These funds have been instrumental in the growth and expansion of the country’s tourism sector, reinforcing its status as a leading destination in the Caribbean.
• The association recognises that investing in tourism has created a myriad of economic opportunities for Dominicans, from job creation in the hotel industry to supporting local businesses offering tourist services and supplies for the hospitality sector. This economic injection has resulted in job growth and increased incomes in the regions targeted by these investments.
• Furthermore, these investments have enabled the Dominican Republic to enhance its standards of service, infrastructure, and overall visitor experiences, solidifying its position as a premier quality tourism destination.

(Source: Dominican Today)

• Mexico's inflation rate likely eased in February, a Reuters poll showed on Monday, March 4, reinforcing bets that the country's central bank could lower its key benchmark interest rate as soon as this month.
• The closely watched core inflation index, which strips out volatile energy and food prices, is seen dropping to 4.62% in the month, its lowest level since June 2021. Rates, however, are still above the central bank's target range of 3%, plus or minus one percentage point.
• Last month, the monetary authority, also known as Banxico, again held the benchmark interest rate at a historic high of 11.25% but hinted that a rate cut could be on the table in upcoming meetings.
• A recent poll of economists by financial group Citibanamex showed that most estimate an initial rate cut to happen when Banxico's board meets on March 21.

 (Source: Reuters)

• US services industry growth slowed a bit in February amid a decline in employment, but a measure of new orders increased to a six-month high, pointing to underlying strength in the sector.
• Despite the weakness in employment, comments from services businesses in the Institute for Supply Management (ISM) survey on Tuesday were generally upbeat and suggested labour shortages remained a constraint for some. There were also no signs that inflation was picking up after a jump in prices at the start of the year, which is considered to be pleasing news for Federal Reserve officials.
• Though financial markets expect the U.S. central bank to start cutting interest rates this year, the timing is uncertain because inflation remains high, with most of the price pressures coming from services such as housing and utilities as well as finance, healthcare, and recreation.
• "While the easing of price pressure and moderation in hiring tilt this report in a dovish direction, the Fed will ultimately want to see these developments translate to the hard data on inflation and job growth," said Tim Quinlan, senior economist at Wells Fargo in Charlotte, North Carolina.
• The ISM said its non-manufacturing PMI slipped to 52.6 last month from 53.4 in January. A reading above 50 indicates growth in the services industry, which accounts for more than two-thirds of the economy. Economists polled by Reuters had forecast the index little changed at 53.0.
• The PMI was consistent with continued economic expansion despite 525 basis points worth of interest rate hikes from the Fed since March 2022. Fourteen services industries reported growth last month, including construction, retail trade, and public administration, as well as utilities and wholesale trade.
• Arts, entertainment and recreation, mining and real estate, rental and leasing reported contraction. The measure of new orders received by services businesses increased to 56.1 last month, the highest level since last August, from 55.0 in January. Export orders, however, slowed after surging in January.

(Source: Reuters)

• According to the Purchasing Managers' Index (PMI) survey, Business activity in the eurozone showed signs of recovery last month as the bloc's dominant services industry expanded for the first time since July, offsetting a deeper contraction in manufacturing.
• Hamburg Composite Bank’s (HCOB’s) composite PMI for the bloc, compiled by S&P Global, jumped to 49.2 in February from January's 47.9, ahead of a preliminary 48.9 estimate. This was its best reading since June, but remained below the 50-mark separating growth from contraction.
• The services’ PMI rose to 50.2 from 48.4, beating the 50.0 flash reading. "The service sector may be off to a better start in 2024 than anticipated. While the growth rate is fractional, it is complemented by positive developments in other PMI sub-indicators," said Cyrus de la Rubia, chief economist at Hamburg Commercial Bank.
• The index covering new business was a whisker shy of reaching breakeven, optimism about the year ahead was at its highest in over a year and firms took on more workers. The services employment PMI rose to an eight-month high of 52.7 from 51.2.
• "While employment is traditionally considered a lagging indicator, this trend hints at a growing sense of optimism and points towards continued sectoral recovery," de la Rubia said. However, there were signs of inflationary pressures building with both the composite input and output price indexes rising. The output prices index was at a nine-month high of 54.4, up from January's 54.2.
• The European Central Bank is expected to keep interest rates at record highs on Thursday as it continues its battle to bring inflation back to target. It will be June before it starts cutting, a Reuters poll found.

(Source: Reuters)

• At the Global Tourism Resilience Conference, Tourism Enhancement Fund (TEF) Executive Director Dr. Cary Wallace disclosed that the Agri-Linkages Exchange (ALEX) platform continues to grow, generating almost $500Mn in sales for small farmers since December 2023.
• The ALEX platform, a collaboration between the TEF and the Rural Agricultural Development Authority (RADA), enables small farmers, usually those with plots ranging from three to five acres, to communicate directly with purchasing managers at hotels. The platform was key in ensuring food security in the tourism sector during the COVID-19 pandemic.
• “In about three years, we achieved a billion dollars in sales on that platform. Between December last year and today, we’ve gone almost half a billion in sales…,” Mr. Wallace said.
• Minister without Portfolio in the Office of the Prime Minister with oversight for Skills and Digital Transformation, Senator Dr. the Hon. Dana Morris Dixon, in her remarks, noted that the use of innovation such as the ALEX platform plays a key role in building the resilience of the tourism sector. She further noted that through technological solutions, the sector has demonstrated remarkable flexibility, enabling it to navigate through the difficulties brought forth by the pandemic.

(Sources: JIS)

• VM Wealth Management Limited, a subsidiary of the Jamaica Stock Exchange listed VM Investments Limited (VMIL), has opened its first overseas office in Barbados. The Barbados location was officially opened on January 22, 2024, after VMIL acquired Republic Funds (Barbados) Incorporated mutual funds.
• VM Wealth Barbados Office manages the now rebranded mutual funds and is making a purposeful push to drive financial education and investment know-how among Bajans and people of the wider Caribbean region.
• The move into Barbados delivers on the business strategy and purpose, according to Brian Frazer, Deputy Chief Executive Officer of VM Investments Limited and VM Wealth Management Limited.

 (Source: JSE)

• An International Monetary Fund (IMF) team visited Barbados between February 26-29, 2024, to review recent economic developments and reform efforts and prepare the ground for the third review of the Extended Fund Facility (EFF)/Resilience and Sustainability Facility (RSF) programs.
• The IMF noted that economic activity in Barbados continued to recover strongly in 2023, driven by tourism and related sectors. Real GDP expanded by an estimated 4.4%, reaching its pre-pandemic level.
• Annual inflation also remained broadly stable despite adverse weather conditions reducing the supply of certain crops and higher prices of dining and other goods and services on account of easing international food prices.
• In terms of fiscal reform, the IMF noted that the Barbadian authorities continue making strong progress in implementing their ambitious economic reform program. Strong fiscal performance through the first three-quarters of FY2023/24 bodes well for meeting the 3.4% of GDP primary balance target for the full fiscal year, and preparation of a budget for FY2024/25 is well underway.
• Furthermore, important steps are being taken to advance the structural reform agenda. Work is currently underway on reforms to strengthen tax administration, public financial management, and the business environment while also building resilience to climate change under the RSF. Meanwhile, the significant progress made in strengthening the AML/CFT framework has enabled Barbados to exit the Financial Action Task Force grey list.

(Source: International Monetary Fund)

• Panama's economy is expected to see growth slow in 2024, according to the latest staff concluding statement done on the country by the International Monetary Fund (IMF).
• Panama was hit hard by the pandemic, but the economic recovery has been strong. In 2023, GDP grew by 7.5%, exceeding expectations for the third year in a row. Drought has led to a reduction in the daily number of ships going through the Panama Canal, but the impact on revenues of the Panama Canal Authority (ACP) has been limited so far.
• In late 2023, after Panama’s Supreme Court ruled that the new mining contract with copper mine operator Minera was unconstitutional, the government announced its intention to close the mine. The ruling followed months of widespread social protests, which had a significant impact on economic activity in the fourth quarter of last year. 
• As a result of the closing of the mine, GDP growth is projected to decline to 2.5% in 2024 before gradually improving over the medium term. The slowdown is not expected to be broad-based but reflects the closing of Minera, which contributed, directly and indirectly, about 5% of Panama’s GDP.
• The closing of the mine also entails the permanent loss of about 0.6% of GDP in fiscal revenues and 7.5% of exports of goods and services. Over the medium term, GDP is expected to grow by 4%, while the current account deficit is projected to range around 2% of GDP.
• The near-term economic outlook is subject to a large degree of uncertainty, and the balance of risks is tilted to the downside. Downside risks include the loss of investment grade status (due to concerns over Panama’s fiscal situation), which would raise Panama’s external borrowing costs and increase refinancing risks. There is also the risk of renewed social unrest and further fallout from the closing of Minera.
• Furthermore, a longer-than-expected drought could reduce the ACP’s revenues and its contributions to the government. Over the medium term, claims from the mine arbitration pose a significant risk to the public finances.

(Source: International Monetary Fund)