Trinidad & Tobago could see its budget deficit shrink thanks to rising oil and gas prices. International investors are likely to welcome the twin-island nation with open arms.
Category: Economy & Policy
Posted inMagazine
Evolving Growth Play
As Brazil’s middle-income segment continues to grow, a straightforward equities buy has become trickier stock-picking terrain. Inflation and government policy are the biggest risks.
Posted inMagazine
In the Line of Fire
Transport, tourism and housing are just some of the sectors susceptible to Mexico’s deteriorating drug violence. Security costs are becoming a concern for Mexican companies.
Posted inMagazine
Panama’s Growing Pains
Rapid growth is still predicted, but the country is encountering speed-bumps along its way. Maintaining fiscal discipline and inflationary pressures will be among the challenges.
Posted inMagazine
Scylla and Charybdis
Peruvians went to the polls in April to send nationalist Ollanta Humala into a June 5 runoff with Congresswoman Keiko Fujimori, setting up a battle between right and left that […]
Posted inMagazine
Slow Recovery
Most of the Caribbean is waiting for developed markets’ economies to improve, but high oil prices threaten the tourism-dependent and highly indebted region.
Posted inDaily Brief
Colombia Raises Rate
Colombia’s central bank has raised its rate by 25bp, to 3.75%, in line with the majority of analysts’ expectations. “The Bank had to make this increase with the rains still falling – after all they can always slowdown later on,” says Celfin. Some analysts had said a pause could have been possible. “A pause could be justified by the better than expected February and March CPI prints and recent improvement in inflation data,” says Goldman Sachs. RBC had said before the announcement that 100bp in hikes could take place before end of Q3 2011.
Posted inDaily Brief
LatAm Has Largest Outward FDI of 2010
LatAm and the Caribbean saw the largest increase in outward FDI flows in 2010, according to a report on investment trends by the United Nations Conference on Trade and Development. The main reason for this was an increase in cross-border M&A. The strong economic growth in the region has increased acquisitions by LatAm companies abroad, particularly in developed countries in which there were investment opportunities following the financial crisis. Brazil, Chile, Colombia and Mexico all registered increased outward FDI flows and cross-border M&A transactions, adds the report. The biggest jump was made by Brazil, where net FDI flows jumped to $11.5bn in 2010 from minus $10.0bn in 2009 due to a fivefold increase in the equity capital part of its outward investments. Overall, developing and transition economies’ share of global outflows increased to 28% in 2010, up from 15% in 2007, adds the report.
Posted inDaily Brief
DomRep Addresses Fiscal Challenges
The Dominican Republic has been successful at a macro level at consolidating its fiscal position and deepening structural reforms, according to a JPMorgan report citing speakers at a seminar hosted by the bank. Growth surprised on the upside and the output gap closed considerably faster than expected, according to the report. The country is expected to adopt measures to help increase the tax ratio to 15% of GDP and lower the deficit. Electricity subsidies are being addressed, with the government moving from subsidizing all electricity to more targeted subsidies for the poor. The government still needs to make public spending more efficient, according to the report. While the government is removing monetary stimulus by hiking rates, speakers add that the government should also accumulate more reserves. The bank adds that foreign exchange reserves are expected to increase as metal exports reach new highs. Meanwhile, the bank expects the number of foreign visitors to the Dominican Republic to climb 4% to 3.66m in 2011.
Posted inDaily Brief
Growth Expected for Jamaica Remittances
JPMorgan forecasts that remittances to Jamaica will increase to almost $2.1bn in 2011, up from $1.9bn in 2010 and $1.8bn in 2009. Remittance inflows to the Caribbean country increased 5.8% in January compared to January 2010 and 10.0% in February, compared to the same month in 2010. JPMorgan says the improving trend in Jamaica’s remittances is consistent with the gradual recovery in the source markets of the US (60%) and the UK (17%), which together account for more than three fourths of total remittance inflows. Other important contributors are Canada (9%) and Cayman Islands (7%).