Caribbean Business News Round-Up

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Caribbean tourism has drastically declined, sinking the region’s gross domestic product 58% last year. Photographer: Ivan Valencia/Bloomberg via Getty Images
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By NAN Business Editor

News Americas, NEW YORK, NY, Fri. May 28, 2021: Here are the top Caribbean business news headlines making news this week.

REGIONAL

Caribbean tourism has drastically declined, sinking the region’s gross domestic product 58% last year and according to a recent survey by the Caribbean Hotel and Tourism Association, a quarter of the more than 250 Caribbean tourism companies surveyed said they do not expect a full recovery until at least mid-2023. More than half of those businesses surveyed said they were unsure they could stay afloat.

GUYANA

The Guyana government has recorded a more-than-$14 billion surplus in its coffers – an increase from last year’s first quarter – which has been fuelled by increased revenue collection as against budgetary spending. This is according to the Bank of Guyana (BoG) first-quarter report, which states that the overall financial position of the Public Sector as of March 2021 month-end was a surplus of $14.251 billion. This sum is applicable for both Central Government and Non-Financial Public Enterprises (NFPEs). The Central Government’s overall balance was a surplus of $10.6 billion at end-March 2021, compared to a surplus of $6.5 billion one year earlier.

The news comes as Hess Corporation, which is a co-venturer alongside ExxonMobil and Ratio in the Kaieteur Block offshore Guyana, has increased its shares in the block following a farm down of 5 per cent working interest by Cataleya Energy (CEL). This means that Hess, which formerly had a working interest of 15 per cent in the Kaieteur Block, will now have a 20 per cent working interest.

SURINAME

Suriname’s struggling economy is awaiting the delivery of significant relief, but its creditors are promising to continue the protracted uncertainty over the South American country’s prospects.

Suriname’s bondholders have objected to their exclusion from an agreement between the Government and the International Monetary Fund (IMF) for US$690 million in credits to be delivered over three years. The Dutch-speaking country defaulted on its bond payments in April and the creditors agreed to defer payments on bonds of US$675 million. However, while the Government awaits approval of the credit agreement from the IMF’s board, its bondholders are threatening to reverse their decision.

BELIZE

The Belize government has formally informed bond holders that it will not be able to make a scheduled US$7-million coupon payment to its international bondholders, which was due on Thursday.

Belize is looking to restructure a US$550-million super bond that emerged from 2006-07 restructuring and now contributes to a 133 per cent debt-to-GDP (gross domestic product) ratio that the International Monetary Fund (IMF) deems unsustainable.

A government statement noted that it is seeking the consent of the bondholders to have the payment deferred to September 19, this year, “with the effect that the amended grace period will expire on the same date as the grace period applicable to the next schedule coupon, payable on August 20, 2021.”

TRINIDAD & TOBAGO

Seven people working on the Maersk Discoverer offshore drilling rig have tested positive for COVID-19, bpTT has confirmed.”

“These individuals have been transported from the rig to Ministry-approved isolation facilities where they are receiving care,” bpTT told Guardian Media in response to questions sent.

All personnel aboard the offshore rig have since been tested.

“bpTT and Maersk have been in contact with representatives from the Ministry of Health and are following guidelines as directed by health officials,” it stated.

GRENADA

The Grenada government has commenced drawing down money from the China Export and Import US$67 million concessional loan that is to be used for the upgrading of the Maurice Bishop International Airport (MBIA). At the same time, the Chinese Yuan (CNY) was officially made a currency component of the Government’s external portfolio.

“For the first time, the Chinese Yuan (CNY) is a currency component of GoG’s external portfolio (2.8%) as a loan from the Republic of China was partially disbursed in the first quarter of 2021 for the St George’s Airport Runway and Road Upgrade and Rehabilitation Project,” said the first quarter public bulletin which is published on the Ministry of Finance website.

DOMINICAN REPUBLIC

Dominican Republic’s consolidated public debt topped US$58.8 billion at the end of the first quarter of this year, equivalent to 70.5% of everything that the national economy produces in a year.

The rise, anticipated in the face of the tax revenue crisis caused by the pandemic, has been US$10 billion in the last twelve months, the largest year-on-year jump recorded in public debt in the country.

Data from the Public Credit Directorate of the Ministry of Finance indicate that a year ago, just when the pandemic was declared worldwide and borders were closed to stop the spread of the new coronavirus, the country already owed approximately US$48.1 billion.

TURKS & CAICOS

staggering $105million was sent out of the Turks and Caicos Islands in 2020 through remittance companies such as Western Union, MoneyGram and CAMS, despite the economic downturn and financial setbacks associated with the COVID-19 pandemic.

The SUN’s analysis of figures from the Financial Services Commission (FSC) statistical digest showed that this amounts to an average of $8.7million per month or around $2million per week leaving the country.

Most of the money, $36.3million was sent to Haiti, followed by $26million to the Dominican Republic, $11.4million to Jamaica, $10.3million to the Philippines, $1.3million to The Bahamas, $1.2million to the United Kingdom (UK), $9million to the United States of America (USA) and $8.1million to other countries, the FSC figures revealed.

ST. LUCIA

With several deals and major acquisitions executed last year, Norbrook Equity Partners Limited (NEPL) successfully closed a private placement of US$17.5 million in debt and equity-linked securities as it looks to develop further latitude in its mission to acquire and develop well-positioned businesses in the Caribbean.

The St Lucia-based diversified investment holding company, which started its operations during the 2008 global recession, is moving its pieces into place as it aims to capitalise on the opportunities which have arisen from the novel coronavirus pandemic. Apart from funding additional acquisition opportunities, NEPL will use the proceeds to refinance part of its 2017 US$5.25 million capital raise, fund general working capital needs and significantly enhance its current portfolio of companies.

BAHAMAS

The Bahamas will boost resilient and inclusive growth to promote business continuity and competitiveness of Micro, Small and Medium Enterprises (MSMEs) as well as their Blue Economy environmental resiliency, with a US$140 million loan approved by the Inter-American Development Bank (IDB).

This is the second operation under the modality of Programmatic Policy-Based Loan (PBP). The first operation was approved in August 2020.

This program supports the mandate and vision of the Bahamas Economic Recovery Committee of providing for a resilient, dynamic, inclusive, and sustainable economy and promotes private sector-led growth under a stronger comprehensive environmental framework. As such, the government is prioritizing reforms geared at promoting competitiveness and improvement of the business climate, under a framework of environmental sustainability and resilience. This includes a medium-term strategy of further improving the business climate and supporting economic diversification aligned with the recommendations of the Economic Recovery Committee report (ERC).