• The Panama Canal’s 2024-25 cruise season officially commenced on Tuesday, October 8, 2024, and is expected to witness over 225 ship transits throughout the season. This should help to support the steady growth of Panama’s economy through tourism activities and its spillover effects.
• According to a press release, this repositioning voyage marks the beginning of over 225 expected transits through the Panama Canal during the season. Albano G. Aguilar, a specialist in market analysis and forecasting at the Office of Corporate Affairs, said that “an increase in transits is expected this fiscal year due to the continued demand for vacation experiences, which still shows no signs of slowing down.”
• “Crossing from one ocean to the other through a fast and safe route like the Panama Canal is also a great attraction for the cruise industry because of the wonder that our operation represents,” said Panama Canal Administrator Ricaurte Vásquez Morales.
• This season, major cruise lines like Norwegian, Carnival, and Royal Caribbean continue to offer full and partial Panama Canal transits, while smaller ships such as Le Bellot and National Geographic Quest are also expected. Fourteen cruise ships, including the World Explorer, Sapphire Princess and Queen Anne, will transit the canal for the first time.
• This fiscal year, 54 Neopanamax passenger ships are expected to transit the Panama Canal, including nine of the largest ever, such as the Norwegian Bliss, Joy and Encore. Inaugural transits of other Neopanamax ships, including the Sapphire Princess, Crown Princess, Queen Anne, Grand Princess and Nieuw Statendam, are also anticipated.
• During the 2022-23 season, the canal recorded 210 Panamax and 41 Neopanamax cruise transits. For the 2023-24 season (through July), 201 transits have been logged, including 42 Neopanamax vessels. The Panama Canal cruise season runs annually from October to May.

(Source: Cruise Industry News)

• The pace of price increases over the past year was higher than forecast in September, while jobless claims posted an unexpected jump following Hurricane Helene and the Boeing strike, the Labour Department reported Thursday.
• The consumer price index, a broad gauge measuring the costs of goods and services across the U.S. economy, increased a seasonally adjusted 0.2% for the month, putting the annual inflation rate at 2.4%. Both readings were 0.1 percentage points above the Dow Jones consensus.
• The annual inflation rate was 0.1 percentage points lower than August and is the lowest since February 2021. Excluding food and energy, core prices increased 0.3% in the month, putting the annual rate at 3.3%. Both core readings were also 0.1 percentage points above forecast.
• Much of the inflation increase — more than three-quarters of the move higher — came from a 0.4% jump in food prices and a 0.2% gain in shelter costs, the Bureau of Labor Statistics said in the release that offset a 1.9% fall in energy prices.
• A separate report Thursday showed weekly jobless claims hitting a 14-month high, indicating potential softness in the labor market despite the big jump in nonfarm payrolls in September. However, most of the surge could be tied to the hurricane and strike. Goolsbee said the data is largely in line with Fed expectations and shouldn’t be viewed in isolation as having an outsized influence on policy.
• The jobless claims figures follow the damage from Hurricane Helene, which struck Sept. 26 and impacted a large swath of the Southeast. Florida and North Carolina, two of the hardest-hit states, posted a combined increase of 12,376, according to unadjusted data. A strike by 33,000 Boeing workers also could be hitting the numbers. Michigan had the largest gain in claims, up 9,490 on the week.

(Source: Reuters)

• Britain's economy grew in August after two consecutive months of stagnation, providing some relief to finance minister Rachel Reeves ahead of the new Labour government's first budget later this month.
• Economic output rose by 0.2% in monthly terms in August, according to figures from the Office for National Statistics that were in line with expectations in a Reuters poll of economists. "This will provide a timely boost for the chancellor amidst a backdrop of growing spending pressures," said Yael Selfin, chief economist at KPMG UK.
• All major sectors showed growth in August, the statistics office said, but weaker-than-expected growth in the dominant services sector. This was offset by a strong rebound in manufacturing and construction.
• Sterling changed a little after the figures were released, with investors continuing to bet on a quarter-point rate cut by the Bank of England in November. Compared to a year ago, economic output was 1.0% higher, below the 1.4% growth forecast by economists, a miss that reflected the downward revisions to previous months.
• Britain's economy now looks on track to grow in the second half of the year, albeit at a slower rate than in the first quarter. Last month, the Bank of England said it expected economic growth to slow to 0.3% in the third quarter and a similar rate of growth in the final three months of 2024.
• "The big question mark is the government's vision for the economy," said Barret Kupelian, chief economist at PwC. "For economic growth to continue on a sustained basis, businesses, households, and foreign investors require certainty to make choices and investment decisions."

(Source: Reuters)

• The Government of Jamaica (GOJ) announced that it secured US$480Mn in its first structured securitisation transaction in the international capital markets. The transaction involved the securitisation of the portion of the Norman Manley International Airport (NMIA) revenue that is due to the GOJ.
• Securitisation of the NMIA revenue was achieved through the issuance of a US$480 million, 12-year bond in the international capital markets by Kingston Airport Revenue Finance Ltd (the “Issuer”). Kingston Airport Revenue Finance Ltd. (KingAir) is a special purpose vehicle held in trust in the Cayman Islands, whose actions are limited to the terms of its debt, and which dissolves after it repays its debt.
• The GOJ granted Kingston Airport Revenue Finance Ltd. its rights to 52.33% of the revenue generated by the Norman Manley International Airport (the “KingAir RevShare”) in exchange for the US$480Mn that was raised through the bond issue.
• The bond issuance was highly successful, with applications totalling US$2.3Bn, representing an oversubscription of over five times the US$440Mn initially sought. The offer was upsized to US$480Mn in response to this robust demand. The Notes will bear a fixed coupon of 6.75% for 12 years and are rated BB and Ba1 by Standard & Poor’s Global Ratings and Moody’s Rating Agency respectively, one notch above each Agency’s sovereign rating for Jamaica.
• Additionally, the Notes are the sole obligation of the Issuer, Kingston Airport Revenue Finance Limited, and there is no recourse to the Government of Jamaica. That is, the Notes do not represent debt obligations of the Government of Jamaica or any of its agencies.
• Kingston Airport Revenue Finance Ltd will also annually distribute to the Government of Jamaica any surplus it achieves above established benchmarks. Once the bond is repaid, the full amount of the KingAir RevShare will return to the Government of Jamaica.
• The GOJ noted that it looks forward to now being able to accelerate critical investments in domestic infrastructure, while at the same time reducing the national debt burden, even in the context of the adverse travel advisory and hurricane induced growth shock and the anticipated flat growth this year, for the benefit of all Jamaicans.

(Source: Ministry of Finance)

• Jamaica is exploring strategic partnerships with the Republic of India to improve the supply and affordability of quality pharmaceuticals locally, in an effort to reduce the cost of healthcare in the country. This was announced by Prime Minister, Dr. the Most Hon. Andrew Holness, in a statement to the House of Representatives on Tuesday (October 8) on his recent visit to India.
• He said India is among the largest manufacturers and exporters of pharmaceuticals globally, with an industry valued more than US$50 billion. The Prime Minister further noted that India provides supplies for nearly all countries around the world.
• “Jamaica’s strategic location offers Indian businesses an ideal nearshore hub to access markets in the USA, Canada and Latin America and the Caribbean and, in return, India represents a large export market for Jamaican products like Blue Mountain coffee, aged rums and liqueurs. But the largest opportunity is tourism, and the Minister of Tourism will be visiting India in a few weeks from now… as a follow on… to get greater tourism from India to Jamaica,” the Prime Minister said.
• Dr. Holness pointed out that in the area of agriculture, discussions during his recent visit to India focused on the sharing of knowledge and best practices in critical inputs such as mechanisation.
• “The most important discussion in agriculture that we had was on affordable irrigation. India has some amazing technology in affordable irrigation, and we also discussed advanced seal technologies and expertise in crop development, agro-processing as well as investment facilitation and credit support.
• “What I particularly like about the Indian agricultural technology is that they rely heavily on using natural solutions… nature-based solutions in pest control and enhancing crop productivity, and I think Jamaica’s farmers would quickly embrace those technologies,” he said.

(Source: JIS)

• On October 8, 2024, the European Union (EU) Council removed Antigua and Barbuda from the EU list of non-cooperative jurisdictions for tax purposes. With this change, the list now consists of the following 11 jurisdictions: American Samoa, Anguilla, Fiji, Guam, Palau, Panama, Russia, Samoa, Trinidad and Tobago, US Virgin Islands, and Vanuatu.
• Antigua and Barbuda was included in the EU list of non-cooperative jurisdictions for tax purposes in October 2023 after a negative assessment from the OECD Global Forum concerning the exchange of information on request.  According to EU officials, the delisting followed “significant reforms” to Antigua and Barbuda’s tax framework. It has granted the country a supplementary review, which will be conducted in the coming months.
• Earlier this year, Antigua’s Parliament passed the Money Services Business (Transfer) Levy Act 2024, which made changes to the country’s 2002 Tax Information Exchange Act, 2007 International Foundations Act, International Trusts Act, and International Limited Liability Companies Act, the 2008 Corporate Management and Trust Service Providers Act, 2018 Tax Administration and Procedure Act and the International Business Corporations Act. The changes include the introduction of a standardized definition of “beneficial owner” and the implementation of annual attestation reports on beneficial ownership and control.
• Prime Minister Gaston Browne, in the Act’s explanatory notes, said that “the purpose of the Act is to ensure that beneficial owners are correctly identified, and that ownership information is available in all cases and is in accordance with international standard.”
• The EU list of non-cooperative jurisdictions for tax purposes was established in December 2017 as part of the EU’s external strategy on taxation. Jurisdictions are assessed based on a set of criteria laid down by the Council, covering tax transparency, fair taxation and implementation of international standards designed to prevent tax base erosion and profit shifting in EU countries. Since 2020, the Council has updated the list twice a year, with the next revision of the list scheduled for February 2025.

(Sources: European Union & Antigua Observer)

• The Dominican government anticipates that its Fiscal Modernization Project, presented at the National Palace, will take effect starting January 1, 2025, according to Finance Minister José (Jochi) Vicente.
• The Minister of Finance announced that the project (which seeks to increase tax revenues by 1.5% of GDP) aims to improve the quality of life for Dominicans through increased tax revenue. He emphasized that if tax revenues are not raised, the government will be unable to fund essential investments needed to meet the growing demands of the population.
• As part of the reform, which has been in development for over five years, the government plans to strengthen social assistance and significantly increase minimum wages in both the public and private sectors. These measures are intended to boost the economy and enhance citizens’ living standards.
• Minister Vicente emphasized that the additional funds will positively impact public services and citizens’ quality of life, using improved garbage collection - key to reducing diseases like dengue - as an example.
• He noted that higher tax revenues would support better public infrastructure and social services. Key infrastructure projects include the metropolitan train linking the capital to Las Américas International Airport, the Santo Domingo Oeste cable car, the San Cristóbal train, and the Santiago monorail. These initiatives are expected to reduce traffic congestion, taking 1.4 million vehicles off the main roads, thus improving mobility, reducing pollution, and enhancing overall quality of life.
• The proposal, expected to be submitted to Congress this week, not only seeks to boost tax collection but also addresses tax evasion, which Vicente characterized as a crime that hinders the delivery of essential public services. The final implementation timeline will; however, depend on the legislative process.

(Source: Dominican Today)

• A "substantial majority" of U.S. Federal Reserve officials last month supported a half-point rate cut to start the turn towards easier monetary policy, but there appeared more universal agreement that the initial move would not commit the Fed to any particular pace of rate reductions in the future, minutes of the two-day policy meeting showed on Wednesday.
• The minutes provided further detail on the breadth of opinion within the Fed as policymakers approved a rate cut of a size usually reserved for moments when the central bank is worried the economy is slowing fast and needs the support of looser financial conditions. The half-point cut drew only a single dissent from Board of Governors member Michelle Bowman, but the minutes said "some" participants supported only a quarter-point cut, while "a few others indicated they could have supported such a decision."
• The minutes “paint a slightly more cautious picture” of the Fed’s approach to rate-cutting, wrote Oliver Allen, senior U.S. economist with Pantheon Macroeconomics, and “suggests that the unease about a 50 bp cut went beyond Governor Bowman.” Still, the minutes indicated that even some policymakers who may have favored an initial quarter-point cut went along with the larger one as a way to catch up with how fast inflation had fallen without putting future rate cuts “on a preset course.”
• Supporters of the half-point cut "observed that such a recalibration of the stance of monetary policy would begin to bring it into better alignment with recent indicators of inflation and the labor market," said the minutes of the Sept. 17-18 session, at which the Fed lowered the benchmark policy rate to a range of 4.75% to 5.00% from the 5.25% to 5.50% range it had maintained since July of 2023.

(Source: Reuters)

• Germany's economy is expected to contract by 0.2% in 2024, the economy ministry said on Wednesday, which is likely to make it for the second year running the only member of the Group of Seven major industrial democracies to post shrinking output.
• The government is cutting its forecast from a previous projection of 0.3% growth for this year, as the expected recovery in the second half of the year failed to materialise. Germany's economy was already the weakest among its large euro zone peers and other G7 countries last year, with a 0.3% decline in gross domestic product.
• The economy contracted in the second quarter, sparking fears of a possible recession, defined as two consecutive quarters of contraction. Early indicators such as industrial production and business climate suggest that the economic downturn has continued into the second half of the year, the ministry said.
• The economy has not grown strongly since 2018 due to its structural problems and geopolitical challenges, Habeck said. The strength of the German economic model was based on two pillars: cheap energy for industry from Russia and functioning global markets for its exports, the economy minister said.
• To counter the cyclical and structural challenges, it has agreed to a growth package of 49 measures. "If they are implemented, the economy will be stronger and more people will come back to work," Habeck said.
• Growth is expected to resume in 2025 due mainly to increased private consumption resulting from higher wages, falling inflation and tax relief, the ministry said. Lower interest rates should also stimulate consumption, it said. However, construction investments will not contribute to growth again until 2026, the ministry said.

(Source: Reuters)

• The Statistical Institute of Jamaica (STATIN) Labour Force Survey (LFS) revealed that in April 2024, the unemployment rate was 4.2%. There were 62,800 unemployed persons; females accounted for 58.1% of those unemployed. There were 29,400 unemployed youth (aged 15 -24) in April 2024, of which 15,100 or 51.4% were males.
• STATIN noted that the changes made to the LFS represent a break in the series, and as such, data comparability with previous quarters is not advised. However, for context, the unemployment rate reported for January 2024 was 5.4%.
• STATIN revised its survey to incorporate the latest international standards and guidelines from the International Labour Organization (ILO), which resulted in a significant change in the definition of employment and unemployment. Additionally, the reference week for the LFS has shifted from the last full week of the previous quarter to the first full week of the current quarter and the minimum age for inclusion in the LFS has been raised to 15, which is consistent with the ILO recommendations (previously 14 years old).
• Overall, the labour force comprised 1,483,100 persons, including 788,500 males (53.2%) and 694,600 females (46.8%), with an overall labour force participation rate of 63.3%.
• Of this, 1,420,300 members of the labour force were employed, with 762,200 males (53.7%) and 658,100 females (46.3%). Among the employed population, 24,800 or 1.7% were underemployed (time-related), meaning they worked part-time but wanted additional hours.
• The occupation group with the highest number of employees was ‘Services and Sales Workers’, employing 324,800 individuals, representing 22.9% of the total employed population. The second largest was ‘Elementary Occupations’, employing 192,900 individuals, followed by ‘Skilled Agricultural, Forestry and Fishery Workers’ which employed 187,800 persons. Regarding industry groups, ‘Wholesale and Retail Trade; Repair of Motor Vehicles and Motorcycles’ was the largest employer, engaging 265,100 individuals or (18.7%).
• Of note, there were 93,900 youth who were not employed, not enrolled in educational activities or currently in training (NEET), of which 48,700 were males and 45,100 females.
• Given the sharp slowdown in Jamaica's economy in the second quarter ( 0.2% from 1.9%) in Q1 2024, and the projected contraction of -0.1% to -1.0% in Q3 due to the impact of Hurricane Beryl, unemployment levels could inch up in subsequent surveys. Of note, recent layoffs by a major BPO company could cause the rate to rise, especially if other operators follow suit.
• The Labour Force Survey is expected to resume its regular quarterly schedule following the delay in the January 2024 report, likely due to the survey’s revisions.

(Source: STATIN)