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SME eSmart- Powering Your Potential Find out more today by calling: (868)-627-8879 ext. 228 or email: [email protected]
▪ Sagicor Financial Corporation Limited’s proposed bond issue initial rating assigned at CariAA
▪ Dominica Agriculture, Industrial and Development Bank’s rating reaffirmed at CariBB-
▪ Beacon Insurance Company Limited’s rating reaffirmed at CariA-
▪ The Government of the Commonwealth of Dominica rating reaffirmed at CariBB
▪ The Government of the Republic of Trinidad and Tobago rating reaffirmed at CariAA+
▪ Eastern Caribbean Home Mortgage Bank’s rating reaffirmed at CariBBB+
▪ Sagicor Group Jamaica Limited’s initial rating assigned at CariA
▪ NIF Holding Company Limited’s TT$4 billion issue rating reaffirmed CariAA
▪ Goddard Enterprises Limited’s rating reaffirmed at CariAA-
▪ NCB Global Finance Limited’s initial rating assigned at CariA
▪ RHAND Credit Union Co-operative Society Limited’s rating reaffirmed at CariBBB-
▪ Development Bank of Jamaica Limited’s rating upgraded to CariA- ▪ Bourse Securities Limited rating reaffirmed at CariA- ▪ PLIPDECO’s rating reaffirmed at CariA+
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REGIONAL
Trinidad and Tobago
Chile's ambassador in T&T: Target South American markets
Chilean Ambassador Juan Aníbal Barría García wants to see more
Trinidadian products on supermarket shelves in Chile, including Angostura
rums.
Committee to evaluate bids for Pointe refinery
The Government has appointed a ten-member committee to evaluate at
least 25 bids for the sale or lease of the Guaracara refinery at Pointe-a-
Pierre.
GML drops $0.26
Overall market activity resulted from trading in 12 securities of which two
advanced, six declined and four traded firm.
...Company loses $8.9m
Guardian Media Ltd yesterday reported an after-tax loss of $8.94 million
for the six months ending June 30, 2019, which represents a 92 per cent
increase in the media house's losses compared with the previous year,
when it was $4.66 million.
Jamaica
Disposal of Petrojam's contaminated ethanol ends September
MINISTER of Science, Energy and Technology Fayval Williams says that
individuals or companies in possession of contaminated ethanol should be
required to disposed of them in accordance with the environmental laws.
Guyana
ExxonMobil wants investors to forget challenge to lopsided contracts, but
they shouldn’t – Analysis
During its 2019 second quarter earnings call, ExxonMobil spoke extensively
about the progress of its development programmes offshore Guyana and
other parts of the world. It also spoke of the billions of dollars it earned in
revenue. But there were several crucial issues, which it did not address
with its investors in hopes that they might simply forget about it. This
observation was made by analysts at the Institute for Energy Economics
and Financial Analysis (IEEFA).
The Bahamas
BTC Suffers $13.6m First Half Revenue Fall
The Bahamas Telecommunications Company's (BTC) $13.6m first-half
revenue decline last night underscored the urgency of pleas for
corporate unity as its business continues to slip away.
BISX Welcomes Newest Member Lydda Capital
The Bahamas International Securities Exchange (BISX) has announced that
Lydda Capital has become the stock exchange's seventh broker/dealer
member.
Cuba
Cuba reveals health, hotel, other service earnings
Cash-strapped Cuba on Friday for the first time published details of its
foreign exchange earnings from services such as telecommunications,
hotels, health and education assistance, in an apparent concession to
creditors.
Dominica
$104 million for housing development in Dominica
Prime Minister and Minister for Finance Roosevelt Skerrit has announced a
$104 million loan from the World Bank for the expansion of the
government’s housing programme.
Venezuela
Amid rising hunger, Venezuela plantain crops threatened by fungus –
agronomists
Venezuela’s banana and plantain crops face potential infestation of a
fungus already effecting neighbouring Colombia, an agronomists’
association said on Wednesday, potentially devastating one of
Venezuela’s main foods amid rising hunger.
Venezuela government to skip Barbados talks to protest U.S. sanctions
Venezuela’s government will skip a round of Norway-brokered talks on
Thursday and Friday to protest a new set of U.S. sanctions meant to force
President Nicolas Maduro from power, the Venezuelan information ministry
said on Wednesday.
Other Regional
ECLAC predicts 2.1% growth for Caribbean
Debt burden in the Caribbean is beginning to fall and there are good
prospects for some countries for 2019, especially Guyana. The region
overall is expected to grow 2.1 per cent in 2019. Speaking at the United
Nations Economic Commission for Latin America and the Caribbean's
(ECLAC) annual economic outlook last week at the agency's Chancery
Lane office in Port of Spain, deputy director Dr Dillon Alleyne said
Guyana's recent oil discovery, expected to go into commercial
production next year, suggests that the expectation is that the economic
performance will grow.
INTERNATIONAL
United States
S&P 500 erases big losses to end up; investors buy bargains, yields off lows
The S&P 500 recovered from steep early losses to end slightly higher on
Wednesday as investors snapped up oversold shares and bond yields
rebounded from significant lows that raised fears about a recession.
U.S. weekly jobless claims fall; labor market strong
The number of Americans filing applications for unemployment benefits
unexpectedly fell last week, suggesting the labor market remains strong
even as the economy is slowing.
Kraft Heinz books more than $1 billion in charges, first-half profit slumps
Kraft Heinz Co’s (KHC.O) net income halved in the first six months the year
as the packaged food maker disclosed well over $1 billion in charges and
write-downs in results delayed by an investigation into its procurement
practices.
Viacom beats quarterly revenue, profit estimates as ad revenue rebounds
Viacom Inc (VIAB.O), the owner of MTV, Comedy Central and
Nickelodeon, beat estimates for quarterly revenue and profit on Thursday,
as it posted rare growth in domestic advertising revenue after about five
years of declines.
United Kingdom
UK pay growth for new staff hits more than two-year low in July - REC
Pay for permanent staff hired in Britain through recruitment agencies rose
in July at the slowest rate since April 2017, according to a survey that
suggested Brexit uncertainty continues to weigh on the labour market.
UK housing market slows after June bounce - RICS
Britain’s housing market softened in July after a small bounce the month
before, a survey showed on Thursday, adding to signs that Brexit worries
are again making households cautious about shopping for a new home.
Europe
European shares bounce on China respite
European shares rose for a second day on Thursday, as investors took
heart from a stronger-than-expected rebound in Chinese exports and
steadying of the yuan after a week of turmoil sparked by an escalation in
U.S.-China trade tensions.
China
China's CITIC Capital raises $2.8 billion in its biggest private equity fund
CITIC Capital, the flagship alternative investment arm of Chinese financial
conglomerate CITIC Group [CITIC.UL], said it raised $2.8 billion in its fourth
China buyout fund, bolstering its ability to cut deals in the world’s second-
largest economy.
China surprises with best export growth since March, but imports remain
weak
China’s exports unexpectedly returned to growth in July on improved
global demand despite escalating U.S. trade pressure, but the rebound
may be short-lived as Washington prepares to slap even more tariffs on
Chinese goods.
Japan
Japan greenlights first South Korea export since July curbs, but with a
warning
Japan has approved shipment of a high-tech material to South Korea for
the first time since imposing export curbs last month, but doubled down
on political pressure and warned it could broaden restrictions on deliveries
to its Asian neighbor.
India
RBI moves unlikely to ease pain for India's struggling shadow banks
India’s central bank outlined two measures on Wednesday aimed at
easing liquidity pressures on crisis-hit shadow banks, but industry insiders
say the moves, while positive, are unlikely to lead to any substantive
improvements in the troubled sector.
Global
Oil rises due to firm yuan, expectations of more OPEC cuts
Oil jumped more than $1 a barrel on Thursday due to expectations that
falling prices may lead to production cuts, coupled with a steadying of
the yuan currency after a week of turmoil spurred by an escalation in U.S.-
China trade tensions.
ExxonMobil wants investors to forget challenge to lopsided contracts, but
they shouldn’t – Analysis Thursday 8th August, 2019 – Kaieteur News
During its 2019 second quarter earnings call, ExxonMobil spoke extensively
about the progress of its development programmes offshore Guyana and
other parts of the world. It also spoke of the billions of dollars it earned in
revenue. But there were several crucial issues, which it did not address
with its investors in hopes that they might simply forget about it. This
observation was made by analysts at the Institute for Energy Economics
and Financial Analysis (IEEFA).
According to Kathy Hipple, a financial analyst at IEEFA and Tom Sanzillo,
Director of Finance at IEEFA, challenges to the lopsided deals Exxon struck
in territories like Guyana and Papua New Guinea are just two crucial facts
the company would probably like investors to overlook. But Hipple and
Sanzillo emphatically stated that they shouldn’t.
The officials noted that ExxonMobil’s contract with Papua New Guinea is
being challenged as one-sided and unfair, with the government of that
nation being intent on reviewing same. On this matter, Exxon has only
said, “We have a contract…” But IEEFA Analysts stress that such
commentary obscures the real risks to its business if countries with
“contracts,” express grievances and opt to review them.
Further to this, the analysts said that the same situation is found in Guyana
where the Production Sharing Agreement (PSA) for the oil-rich Stabroek
Block is deemed to be lopsided. Hipple and Sanzillo reminded that terms
of Guyana’s contract with Exxon were negotiated with prior governments
and appear to be more favorable to the company. They stressed that
during Exxon’s earnings call, there was no mention of this emerging issue
while reiterating that investors should not ignore same.
(IEEFA conducts research and analyses on financial and economic issues
related to energy and the environment. The Institute’s mission is to
accelerate the transition to a diverse, sustainable and profitable energy
economy.)
LOOPHOLES IN GUYANA-EXXON PSA
Just recently, Head of the Energy Department, Dr. Mark Bynoe revealed
that the finishing touches are still being added to the new model PSA,
which will be used for future licensing rounds. That document is expected
to be a significant improvement over the Guyana-Exxon PSA, which
leaves the nation exposed to massive revenue leakage.
It is along these lines that Chatham House Advisor and Local Content
Expert, Anthony Paul expressed that there are at least 12 key elements
which must be included in that document to safeguard Guyana from
abuse.
These fundamental provisions Paul recommended are contained in a
report he wrote on the request of the United Nations Development
Programme (UNDP). That international organisation had commissioned
this report for the Government. It was handed over to the administration in
2016.
The Principal Consultant of the Association of Caribbean Energy
Specialists Ltd. said that Guyana can readily, and should require in its new
model PSA, that all contracts be subject to new laws and regulations and
not immune to ring fencing provisions which allow costs from unsuccessful
wells to be offset against those that are.
Further to this, Paul recommended that Guyana needs tighter cost
recovery provisions. In this regard, he said that Guyana needs to
determine what can be recoverable and non-recoverable based on
international best practices. Along these lines, he said that there should
be transfer pricing controls and suitable sanctions included in the model
PSA.
Paul also said that Guyana’s model PSA needs to have stronger local
content and capacity development requirements, and if possible, have it
attached as a caveat for being able to keep the exploration or
production licence.
Furthermore, the Consultant emphatically stated that Guyana’s model
PSA needs to have clear rules on the disclosure of the beneficial owners
for oil companies involved, capital gains tax, methods to be used for the
accounting of all expenditure and where documents should be held, as
well as the international benchmarking costs that would be used.
The Chatham House Advisor also said that it would be in Guyana’s best
interest to tie the model PSA to signature bonuses, aggressive
relinquishment clauses, and the right to refusal of farm-outs or farm-ins
following a thorough evaluation of the technical and financial capability
of the firm as well as its strategic fit to Guyana.
Also, the Consultant suggested that the new Model PSA should allow the
government to have retained equity or carried participation in all new
licences.
<< Back to news headlines >>
BTC Suffers $13.6m First Half Revenue Fall Wednesday 7th August, 2019 – Tribune 242
The Bahamas Telecommunications Company's (BTC) $13.6m first-half
revenue decline last night underscored the urgency of pleas for
corporate unity as its business continues to slip away.
Figures for the first six months of 2019, released by its ultimate parent,
Liberty Latin America, revealed that BTC's top-line for the period was
down by 11.4 percent year-over-year as it lost a further 9,300 mobile
subscribers during the second quarter.
Liberty Latin America's 10-Q filing with the US Securities & Exchange
Commission (SEC) showed BTC's 2019 first half revenues fell to $106.1m
compared to $119.7m in the same period last year, indicating that its loss
of mobile market share to Aliv is continuing.
The Bahamian communications carrier's revenues for the 2019 second
quarter, which includes the three months to end-June, were also off 7.4
percent year-over-year at $52.5m compared to $56.7m for 2018.
The top-line declines appear to have been driven by a further 9,300 net
loss of mobile subscribers during the 2019 second quarter, which
challenges the optimism expressed by Garfield "Garry" Sinclair, BTC's chief
executive, that market share declines were starting to "plateau" in his
recent interview with Tribune Business.
Data provided by Liberty Latin America showed that a modest gain of 700
post-paid mobile subscribers was more than offset by the loss of another
10,000 pre-paid customers during the three months to end-June 2019.
This left BTC with some 213,500 mobile subscribers as at June 30, split
between 188,000 pre-paid customers and 25,500 post-paid subscribers,
with the numbers providing further evidence that its upstart rival, Aliv,
continues to eat into its market share and legacy monopoly.
Liberty Latin America's results announcement reiterated that BTC
continues to be a drag on the performance of Cable & Wireless
Communications (CWC), its immediate parent, which was acquired by
the former some years after the 2011 privatisation.
It said of CWC: "Mobile revenue attrition of 9 percent on a rebased basis
was partly offset by rebased revenue growth of 4 percent in B2B (business)
and 1 percent in residential fixed.
"The reduction in mobile revenue year-over-year was primarily attributable
to lower service revenue in Panama and The Bahamas, where continued
competition drove decreases in ARPU (average revenue per user) and
the average number of subscribers."
BTC's subscriber numbers showed virtually no positive improvement
elsewhere. Customer numbers excluding mobile fell by 2,900 during the
2019 second quarter, with TV/video and Internet subscribers declining by
500 apiece and fixed-line telephone customers down by 1,900.
While BTC's infrastructure passes some 128,900 Bahamian homes, it had
just 6,100 TV/video and 25,700 Internet customers at end-June 2019.
Telephone customers totalled 44,400, bringing BTC's non-mobile revenue
generating units to 76,200.
The data provides ample evidence to back Mr Sinclair's warning to BTC's
two trade unions that their tactics "could be fatal" to a business that has
lost $110m in annual revenue in less than three years, going from a $330m
top-line to one that is nearer $220m.
BTC's half-year revenue pace suggests breaking the $200m revenue mark
could be a struggle, further supporting Mr Sinclair's contention that the
former government monopoly will face "an existential crisis" as it tries to
"win again" in a fiercely competitive market unless the unions "stop finding
a dark cloud behind every silver lining".
In an impassioned call for unity within BTC, Mr Sinclair told Tribune Business
in a recent interview that both the line staff and management union must
"resist the temptation to fall back into ancient habits and practices from
the monopoly days" if the carrier is to adjust its business model and
properly compete with the likes of Cable Bahamas and Aliv.
Voicing disquiet at the two unions' seeming tendency to "sow dissent and
extend controversy at the first sign of adversity", Mr Sinclair argued that
BTC had still to adjust to the loss of its long-standing mobile monopoly and
the need to compete in a liberalised Bahamian communications market.
"We're no longer a $330m a year revenue business. We're a $220m
business," he said recently. "If we don't make that adjustment, we're in an
existential crisis. It's been tough to make adjustments to the operating
model now that it has one-third less revenue. The ability to do that has
been tough."
However, the numbers revealed last night also seemingly challenge Mr
Sinclair's assertion that mobile subscriber churn is declining sharply and
that BTC is doing a better job of retaining market share in the battle with
Aliv.
Mr Sinclair had said in his recent interview with Tribune Business that BTC's
loss of mobile subscribers to Aliv had been on "a fairly steep decline", with
the rate of attrition falling by 32,000 in 2018 compared to the prior year.
He added that 2019 to-date had produced further evidence that these
customer losses were starting to bottom out.
"The target was to cut prior year churn in half," Mr Sinclair said of BTC's
2019 mobile targets. "We're well ahead of that target and would have
been even further ahead but we made some decisions with respect to
subsidised handsets and our investment in subsidised handsets.
"We're going to revisit that in the second half, and you'll find us way more
competitive there." He added that BTC also planned to introduce a
"simplified" range of new mobile plans, along with a "fresh-fixed line
proposition", that customers will find "particularly compelling" heading into
the 2019 second half and final quarter.
<< Back to news headlines >>
BISX Welcomes Newest Member Lydda Capital Wednesday 7th August, 2019 – Tribune 242
The Bahamas International Securities Exchange (BISX) has announced that
Lydda Capital has become the stock exchange's seventh broker/dealer
member.
Keith Davies, BISX's chief executive, said of the new addition: "It is our
pleasure to welcome Lydda Capital Ltd. By taking this determinative step
by becoming a BISX broker/dealer member, Lydda has demonstrated
their commitment to the Bahamian capital market's growth and
development. We look forward to seeing them begin trading on the
exchange and offering services to clients."
Alicia Curry, a client relationship manager for Lydda, added: "Lydda
Capital is excited by the expansion of its product offerings, and is looking
forward to assisting clients desirous of trading on BISX."
Lydda Capital's broker/dealer status gives investors more options and
choice over who they select to conduct their trading activities and meet
other capital markets needs.
"Before any broker/dealer becomes a BISX member, they are required to
first go through the licensing process of the Securities Commission, after
which they need to go through BISX's own separate due diligence
process," Mr Davies said. "Lydda was very proactive in both providing
information and responding to our queries during this phase."
<< Back to news headlines >>
S&P 500 erases big losses to end up; investors buy bargains, yields off lows Wednesday 7th August, 2019 – Reuters
The S&P 500 recovered from steep early losses to end slightly higher on
Wednesday as investors snapped up oversold shares and bond yields
rebounded from significant lows that raised fears about a recession.
Increasing worries over a global economic downturn and bets the Federal
Reserve will have to pick up its pace of interest rate cuts pushed Treasury
yields sharply lower early, with 10-year yields touching their lowest since
October 2016.
Ten-year yields began to cut their earlier decline in afternoon trading after
a soft auction.
That recovery in yields helped stocks, which have been tracking the
movement in 10-year yields, said Michael Antonelli, market strategist at
Robert W. Baird in Milwaukee.
“The 10-year yield has come to represent all of the concerns about global
growth at this very moment, so the stock market has latched onto it, like a
kid to a lollipop. So when yields started to rise today, the stock market
started to rise,” he said.
“I wouldn’t expect the market to shoot back to its high. We could be
stuck in a range as this stuff sorts itself out.”
During the session, the premium on three-month Treasury bill rates over 10-
year Treasury yields, a closely watched U.S. recession indicator, was at its
most elevated levels since March 2007.
Financials were the biggest loser among S&P 500 sectors, down 1.2%,
while the staples and materials indexes ended up more than 1% each.
Investors also were attracted to some bargains in shares after the recent
selloff. The S&P 500 is down 4.7% since its July 26 record high close.
The Dow Jones Industrial Average fell 22.45 points, or 0.09%, to 26,007.07,
the S&P 500 gained 2.21 points, or 0.08%, to 2,883.98 and the Nasdaq
Composite added 29.56 points, or 0.38%, to 7,862.83.
Interest rates futures suggested traders are building bets the Fed will cut
interest rates three more times by year-end.
Central banks in New Zealand, India and Thailand on Wednesday cut
their lending rates amid growing fears that the U.S.-China trade war could
aggravate a slowdown in the global economy.
Trade concerns re-emerged after President Donald Trump last week
threatened to slap 10% levies on the rest of $300 billion of Chinese imports
and called China a currency manipulator on Monday.
The energy sector was down 0.8% after oil prices slid.
On the plus side, CVS Health Corp shares climbed 7.5% after the drugstore
chain raised its full-year profit forecast.
Walt Disney Co dropped 4.9%, a day after its quarterly earnings missed
analysts’ forecast on higher investments in its streaming platform.
Declining issues outnumbered advancing ones on the NYSE by a 1.04-to-1
ratio; on Nasdaq, a 1.03-to-1 ratio favored decliners.
The S&P 500 posted 17 new 52-week highs and 31 new lows; the Nasdaq
Composite recorded 41 new highs and 212 new lows.
Volume on U.S. exchanges was 9.05 billion shares, compared to the 7.1
billion average for the full session over the last 20 trading days.
<< Back to news headlines >>
U.S. weekly jobless claims fall; labor market strong Thursday 8th August, 2019 – Reuters
The number of Americans filing applications for unemployment benefits
unexpectedly fell last week, suggesting the labor market remains strong
even as the economy is slowing.
Initial claims for state unemployment benefits declined 8,000 to a
seasonally adjusted 209,000 for the week ended Aug. 3, the Labor
Department said on Thursday. Data for the prior week was revised to show
2,000 more applications received than previously reported.
Last week’s drop in claims pushed them to the lower end of their 193,000-
244,000 range for this year. Economists polled by Reuters had forecast
claims would be unchanged at 215,000 in the latest week. The Labor
Department said only claims for Idaho were estimated last week.
The four-week moving average of initial claims, considered a better
measure of labor market trends as it irons out week-to-week volatility,
edged up 250 to 212,250 last week.
U.S. stock index futures held gains after the release of the data. Prices of
U.S. Treasuries dipped while the dollar .DXY was trading slightly higher.
Claims will be watched over the coming weeks for signs that deteriorating
trade relations between the United States and China, which have
dimmed the economy’s outlook and roiled financial markets, were spilling
over to the labor market.
Concerns over the impact of the bitter trade war between Washington
and Beijing on the U.S. economic expansion, the longest on record,
prompted the Federal Reserve to cut interest rates last week for the first
time since 2008.
With tensions between the two economic giants escalating in recent days
and recession risks rising, financial markets have fully priced in another
rate cut next month. Expectations for a 50-basis-point cut at the Fed’s
Sept. 17-18 policy meeting have also risen.
While hiring has slowed, the pace of job gains remains well above the
roughly 100,000 needed per month to keep up with growth in the working-
age population.
Nonfarm payrolls increased by 164,000 jobs in July, down from 193,000 in
June. Job growth over the last three months averaged 140,000 per month,
the lowest in nearly two years, compared to 223,000 in 2018. The
moderation in employment growth partly reflects a shortage of workers.
The economy grew at a 2.1% annualized rate in the second quarter,
slowing from the first quarter’s brisk 3.1% pace. Growth is seen below a
2.0% rate in the July-September quarter.
Thursday’s claims report also showed the number of people receiving
benefits after an initial week of aid dropped 15,000 to 1.68 million for the
week ended July 27. The four-week moving average of the so-called
continuing claims fell 11,000 to 1.69 million.
<< Back to news headlines >>
Kraft Heinz books more than $1 billion in charges, first-half profit slumps Thursday 8th August, 2019 – Reuters
Kraft Heinz Co’s (KHC.O) net income halved in the first six months the year
as the packaged food maker disclosed well over $1 billion in charges and
write-downs in results delayed by an investigation into its procurement
practices.
The company wrote down the value of some of its units, including its U.S.
refrigerated business, by about $744 million. It also booked an impairment
charge of $474 million in the second quarter to write down the value of six
brands, including Velveeta and Cool Whip.
Kraft Heinz’s earnings report was delayed as it restated financial reports for
a near three-year period after an internal investigation into lapses in
procurement practices by some of its employees.
The company’s shares fell 6% in premarket trading on Thursday. The stock
has lost a third of its value since Feb. 21, when the company posted a
surprise quarterly loss, disclosed an SEC investigation into its accounting
practices, and wrote down the value of its iconic Kraft and Oscar Mayer
brands by over $15 billion.
Net income attributable to the company’s shareholders fell to $854 million,
or 70 cents per share, in the six months ended June 29, from $1.76 billion,
or $1.43 per share, a year earlier.
Excluding items, the Chicago-based company earned $1.44 per share,
compared with $1.89 a year earlier. Kraft Heinz said net sales fell about 5%
to $12.37 billion.
“The level of decline we experienced in the first half of this year is nothing
we should find acceptable moving forward,” Kraft Heinz’s new chief
executive, Miguel Patricio, said.
Patricio, a 30-year marketing veteran from Anheuser-Busch InBev (ABI.BR),
was named to the role in April.
<< Back to news headlines >>
Viacom beats quarterly revenue, profit estimates as ad revenue rebounds Thursday 8th August, 2019 – Reuters
Viacom Inc (VIAB.O), the owner of MTV, Comedy Central and
Nickelodeon, beat estimates for quarterly revenue and profit on Thursday,
as it posted rare growth in domestic advertising revenue after about five
years of declines.
Viacom said domestic advertising revenue rose 6% to $976 million.
“Importantly, we returned domestic advertising revenue to growth, which
is a direct result of the strategy we have been executing for the last two
years and the significant progress we have made in scaling Advanced
Marketing Solutions,” Viacom Chief Executive Officer Bob Bakish said.
Talks with CBS Corp (CBS.N) to recombine are ongoing with a deal
expected to land shortly, people familiar with the matter have said.
Last week, the two companies, both controlled by Sumner and Shari
Redstone’s National Amusements Inc, agreed to a management structure
that will see Bakish become the CEO of the new company.
Viacom on Thursday did not provide any details on the merger talks.
Revenue from the filmed entertainment division, which includes
Paramount Pictures, rose 14% to $877 million, above estimates of $855.7
million.
Net income attributable to Viacom rose to $544 million, or $1.35 per share,
in the third quarter ended June 30, from $522 million, or $1.29 per share, a
year earlier.
Total revenue rose to $3.36 billion from $3.24 billion, beating the average
estimate of $3.33 billion, according to IBES data from Refinitiv.
Excluding items, the company earned $1.20 per share, above the
average estimate of $1.07 per share.
<< Back to news headlines >>
Japan greenlights first South Korea export since July curbs, but with a
warning Wednesday 7th August, 2019 – Reuters
Japan has approved shipment of a high-tech material to South Korea for
the first time since imposing export curbs last month, but doubled down
on political pressure and warned it could broaden restrictions on deliveries
to its Asian neighbor.
The approval and subsequent warning illustrate how Tokyo is ready to up
the ante in the diplomatic row and yet unwilling to fully cut off exports to
South Korea.
The dispute, rooted in their wartime past and exacerbated by the recent
tightening of curbs on shipments of three high-tech components, has
stoked nationalism and raised trade concerns.
Relations between the two U.S. allies worsened late last year as part of a
decades-old dispute over compensation for forced laborers during
Japan’s occupation. South Korea has invoked its difficult history with
Japan, which colonized the Korean peninsula during World War Two.
“Usually, we don’t announce each time we give export permission.
However, the South Korean government has referred to our moves as an
embargo on exports, which is unfair criticism,” Japanese Industry Minister
Hiroshige Seko told a briefing.
It is the first time since the export curbs were introduced last month that
Japan has allowed shipment of one of the three high-tech materials, he
said.
He was quick to add Tokyo would expand the curbs beyond the three
specialized chemicals - fluorinated polyimides, photoresists and hydrogen
fluouride - if there were any cases of “improper” use. Some of the
chemicals, which are used to make smartphone displays and chips, can
also be used in weapons.
Japanese officials have cited unspecified security reasons for their export
curbs.
But they have pointed to an erosion of trust after South Korean court
rulings last year ordered Japanese firms to compensate wartime forced
laborers. Tokyo says the matter was settled by a 1965 treaty normalizing
bilateral ties.
South Korea’s president, Moon Jae-in, said on Thursday that tighter curbs
would undermine Japan’s international credibility and accused Tokyo of
using its industrial advantage as a weapon against another country.
“Even if there are any gains, it will be short-lived. In the end it is a game
without winners, where everyone, including Japan itself, becomes a
victim,” Moon said.
WHITE LIST
The high-tech material that has been just cleared by Japan for export is
EUV photoresists, South Korean Prime Minister Lee Nak-yon said. The
chemical is crucial for Samsung’s advanced contract chipmaking
production.
Samsung declined to comment.
But it remains unclear if this approval from Tokyo signals a breakthrough in
trade relations.
“They approved only one out of a number of items,” a South Korean
senior trade ministry official pointed out.
A presidential official said: “It doesn’t mean that uncertainties have been
completely removed for the other items.”
Japan has removed South Korea from the “white list” of countries with
fast-track trade status, meaning some exporters may have to go through
a lengthy permit application process to ship restricted items to South
Korea.
That covers a broad range of items, including those applicable to
weapons production and machine tools.
South Korea, which was scheduled to take a call on a plan to drop Japan
from its “white list” on Thursday, has, however, put off the decision until
further discussions.
But the country has said it plans to tighten regulations on imported coal
ashes, mostly from Japan, used to produce cement, and has proposed
tax benefits for local firms in case they need to buy foreign chemical
makers as Seoul tries to cut reliance on Japan.
South Korea’s national security council meeting took place on Thursday
where members agreed to review measures to deal with Japan’s
“retaliatory” actions, but continue to try to resolve the issue via dialogue,
according to the presidential office.
The curbs have also prompted concern among corporate Japan.
“This situation benefits neither Japan nor South Korea,” Masashi Oka,
senior executive vice president at Nikon, told a recent briefing. “We
strongly hope that both countries can return to normal economic activity
as soon as possible.”
Given the curbs in place, Japan’s approval to export the three materials
could take up to 90 days, slowing shipments.
VITAL LINK
The export curbs highlight how Japan controls a vital link in the global
supply chain. It remains a major player in specialized chip components,
even though it was overtaken as a chipmaker years ago by South Korea.
At a New York event for a new flagship phone launch, the head of
Samsung’s mobile division told reporters he could not rule out a potential
impact on the supply chain for smartphone production if the curbs
dragged on for more than four months.
Shares of Tokyo Ohka Kogyo rose 3.9% and Stella Chemifa surged 10.1%
after the latest export approval. Tokyo Ohka Kogyo makes photoresists
and Stella Chemifa produces hydrogen fluoride, both materials affected
by the export curbs.
South Korean chipmakers are hitting a dead end in their quest to find
alternatives for key Japanese materials that have been slapped with
restrictions, raising the prospect of major disruption to their operations in
coming months.
<< Back to news headlines >>
Oil rises due to firm yuan, expectations of more OPEC cuts Wednesday 7th August, 2019 – Reuters
Oil jumped more than $1 a barrel on Thursday due to expectations that
falling prices may lead to production cuts, coupled with a steadying of
the yuan currency after a week of turmoil spurred by an escalation in U.S.-
China trade tensions.
Brent crude LCOc1 was up 67 cents at $56.90 a barrel by 1130 GMT, after
hitting a session high of $58.01.
U.S. West Texas Intermediate (WTI) crude futures CLc1 rose 96 cents to
$52.05 a barrel after hitting a peak of $52.84.
China’s yuan strengthened against the dollar and its exports
unexpectedly returned to growth in July on improved global demand
despite U.S. trade pressure.
“Brent and WTI were rebounding on the combination of a stronger-than-
expected official fix in the yuan, alleviating currency war fears,” said Harry
Tchilinguirian, global oil strategist at BNP Paribas in London.
Reports that Saudi Arabia, the world’s biggest oil exporter, had called
other producers to discuss the slide in crude prices might also have
supported the market, he said.
Both crude contracts fell to their lowest since January on Wednesday
after the U.S. Energy Information Administration said U.S. crude stockpiles
rose last week after nearly two months of decline as imports hit their
highest since January. [EIA/S]
Emily Ashford, executive director of energy research at Standard
Chartered, said she would not read too much into a “short-term rise” on
Thursday as it could be a correction to a sell-off that was “a little too
extreme”.
“We believe the oil market is starting to price in the fear of a severe and
multi-year breakdown in U.S.-China economic relations,” she said.
Crude oil shipments into China, the world’s largest importer, in July rose
14% from a year earlier as new refineries ramped up purchases. Fuel
exports continued to climb as supply outstripped demand in the world’s
second-largest oil consumer.
Saudi Arabia plans to keep its crude oil exports below 7 million barrels per
day (bpd) in August and September to drain global inventories and return
the market to balance, a Saudi oil official said.
Geopolitical tensions over the safety of oil tankers passing through the
Persian Gulf remained unresolved as Iran refused to release a British-
flagged tanker it seized last month.
The U.S. Maritime Administration said U.S.-flagged commercial vessels
should send their transit plans for the Strait of Hormuz and Gulf waters to
U.S. and British naval authorities, and that crews should not forcibly resist
any Iranian boarding party.
<< Back to news headlines >>
Chile's ambassador in T&T: Target South American markets Thursday 8th August, 2019 – Trinidad Express Newspaper
Chilean Ambassador Juan Aníbal Barría García wants to see more
Trinidadian products on supermarket shelves in Chile, including Angostura
rums.
'You have a rum with a very long tradition, and I don't see it in our
supermarkets. And when I talk with some colleagues from other embassies
of South American they also say no..,' he said.
García also questioned why Trinidad Carnival is not promoted in Chile.
'I think that you have an exceptional location that is close to South
Amercia. Our regions, with all the political and economic situations,
changed, but this is a very big market,' he stressed.
'South American is more than Venezuela. South America, and of course
Chile, represents a great opportunity for your exporters, for your
producers, for your manufacturers, for your service, for your tourists,' he
added.
García, who arrived in Trinidad in August last year, said his main purpose is
to ensure increased trade between the two countries.
He was at the time addressing the launch of ExporTT's trade mission to
Chile, held yesterday at Export House, Port of Spain.
García was of the opinion that T& T citizens sometimes did not believe in
their enormous potential.
He said for instance, he was highly surprised to discover that T& T provides
the Trintario cocoa, which is used by many countries to produce brand-
name chocolates.
'What happened with this, especially when you have today a necessity, in
some way an urgency... to diversify your economy,' he said.
Noting T& T's diversification goals, García said focus should be placed on
'good' products that can 'identify your country'.
'That is the case with our (Chile) wine. Italy, Spain, Portugal and Germany
produce wine but we said our wine is different, is better even than the
other wines. That is the same thing with you because you provide the
cocoa for a lot of countries,' he pointed out.
ExporTT's trade mission to Chile officially runs from September 2 to 4.
According to ExporTT chief executive officer Betty Ann Noreiga-Mollineau,
T& T's participation will include a number of leading manufacturers from
various sectors.
She said Ambassador of T& T to Chile, Dr Amery Browne, will receive the
T& T delegation on their arrival next month.
'The Chilean market presents an exciting opportunity for Trinidad and
Tobago. ExporTT is progressively encouraging and making a strong case
for continued development of negotiations for an official trade
agreement with Chile,' Noreiga-Mollineau stated.
'It is our desire that this trade mission creates an opportunity for our
manufacturers and will continue to push developing negotiations in the
right direction,' she said.
<< Back to news headlines >>
Committee to evaluate bids for Pointe refinery Thursday 8th August, 2019 – Trinidad Express Newspaper
The Government has appointed a ten-member committee to evaluate at
least 25 bids for the sale or lease of the Guaracara refinery at Pointe-a-
Pierre.
Trinidad Petroleum Holdings Ltd (TPHL) says the evaluation committee will
be led by permanent secretary in the Ministry of Finance Vishnu
Dhanpaul.
The committee will evaluate all bidders participating in the Guaracara
request for proposal (RFP) and make a recommendation to the Cabinet
on the preferred bidder. TPHL stated that the appointment of the
committee will remove any requirement for the board of directors to
conduct the evaluation and selection as the committee will assume full
responsibility for the selection of the preferred bidder.
'Consequently, the Government has indemnified the board of directors of
Trinidad Petroleum Holdings Ltd (TPHL) from any liability that may stem
from the decisions and/or actions of the evaluation committee,' it stated.
The refinery at Pointe-a-Pierre was mothballed starting on November 30,
2018 as part of the transformation of Petrotrin to TPHL. That transformation
involved the termination of 5,500 employees, both permanent and
contract, and the creation of a new holding company for the State-
owned assets (TPHL) and the establishment of functional subsidiaries,
including Guaracara, Heritage (exploration and production) and Paria
(trading).
Speaking at a PNM public meeting last month, Prime Minister Dr Keith
Rowley said the refinery was advertised to the world and 77 proposals
were submitted.
But 25 proposals qualified and were selected to view the refinery's data
room, he said. Rowley said the Government had outlined guidelines to the
potential buyers in the search process. He said the successful entity would
be required to restart the refinery.
'Because that is what we want. We shut it down, but we want the refinery
to operate because we know if the refinery operates and we escape the
burden of finding the oil to put in it, it will be good business for Trinidad
and Tobago. They have to hire people, hire contractors to service all the
needs. It matters not who owns the refinery. Certain things have to go into
it,' he said.
The company putting forward a proposal must have experience in
refining.
'A refinery is not a chemistry set. You have to know what you talking about
and you have to work it safely in Pointe-a-Pierre,' Rowley said.
The proposal must also include an attractive price, either lease or
purchase, as 'if you come with Mickey Mouse numbers we are not
interested,' he said.
And the buyer should demonstrate its ability to meet the financial
obligations required to operate the refinery.
Rowley said the process began in January and five months later the non-
binding proposals were submitted.
He said site visits began in June and by the end of August the search
process is expected to be completed.
<< Back to news headlines >>
GML drops $0.26 Thursday 8th August, 2019 – Trinidad Express Newspaper
Overall market activity resulted from trading in 12 securities of which two
advanced, six declined and four traded firm.
The Composite Index declined by 1.79 points (0.13 per cent) to close at
1,396.03. The All T& T Index declined by 1.87 points (0.11 per cent) to close
at 1,776.81.
The Cross Listed Index declined by 0.23 points (0.17 per cent) to close at
137.43. The SME Index remained at 90.00.
Trading activity on the first tier market registered a volume of 167,251
shares crossing the floor of the Exchange valued at $1,221,099.56.
FirstCaribbean International Bank was the volume leader with 51,700
shares changing hands for a value of $431,659.29, followed by Trinidad
Cement Ltd with a volume of 49,450 shares being traded for $121,152.50.
JMMB Group contributed 28,285 shares with a value of $63,641.25, while
Guardian Holdings Ltd added 21,430 shares valued at $390,475.48.
CLICO Investment Fund registered the day's largest gain, increasing $0.09
to end the day at $24.14. Conversely, Guardian Media Ltd registered the
day's largest decline, falling $0.26 to close at $10.50.
CLICO Investment Fund was the only active security on the mutual fund
market, posting a volume of 4,696 shares valued at $113,383.40. CLICO
Investment Fund advanced by $0.09 to end at $24.14. Calypso Macro
Index Fund remained at $14.17.
The second tier market did not witness any activity.
The SME market did not witness any activity. CinemaOne remained at
$9.00.
The USD equity market did not witness any activity. MPC Caribbean Clean
Energy remained at US$1.00.
<< Back to news headlines >>
...Company loses $8.9m Thursday 8th August, 2019 – Trinidad Express Newspaper
GUARDIAN Media Ltd yesterday reported an after-tax loss of $8.94 million
for the six months ending June 30, 2019, which represents a 92 per cent
increase in the media house's losses compared with the previous year,
when it was $4.66 million.
GML's third-party revenues declined by 14.7 per cent, falling to $52 million
for the half year, compared with $60.9 million in 2018.
GML's newspaper reported a loss before taxation of $6.86 million for the
six-month period, whereas in 2018, the newspaper declared a pre-tax
profit of $1 million. Both GML's newspaper and its multi-media segment
experienced declining revenues for the first six months of 2019.
GML chairman Peter Clarke said in a statement accompanying the
unaudited financials that he had noted in his 2018 year-end statement to
shareholders that dividend payments will resume once the company
returns to profitability.
'Given the loss position, a 2019 interim payment will not be recommended
by the board in respect of the six months ended June 30, 2019.'
<< Back to news headlines >>
ECLAC predicts 2.1% growth for Caribbean Thursday 8th August, 2019 – Trinidad and Tobago Newsday
Debt burden in the Caribbean is beginning to fall and there are good
prospects for some countries for 2019, especially Guyana. The region
overall is expected to grow 2.1 per cent in 2019. Speaking at the United
Nations Economic Commission for Latin America and the Caribbean's
(ECLAC) annual economic outlook last week at the agency's Chancery
Lane office in Port of Spain, deputy director Dr Dillon Alleyne said
Guyana's recent oil discovery, expected to go into commercial
production next year, suggests that the expectation is that the economic
performance will grow.
The Caribbean in general is expected to continue to have steady growth,
although it has been sluggish in 2019.
“While the de-risking phenomenon had eased, it could resurface to target
the offshore financial sector. Other external risk factors include volatility of
commodity prices, hurricanes, trade wars and a global economic
slowdown. Guyana is attracting foreign direct investment (FDI) ahead of
oil production.”
Alleyne said for the first time since 2017 all Caribbean countries are
expected to post positive growth in 2019.
Jungle Bay in Dominica.
Among the outstanding contributors were Antigua and Barbuda,
Grenada, Dominica and Guyana.
“Guyana in particular has been posting consistent growth but Antigua
and Barbuda and Grenada, much of that growth have been driven by
investment through their citizens’ investment programme." The
programmes vary, but essentially, people who are coming into the
country to invest, for example, would put a sum of money aside and then
they get citizenship. "I think this is a programme that could be used also to
source talent. Entrepreneurial talent, scientific talent and other types of
talents. TT may have other options. I don’t think the programme suite
everyone.”
Alleyne said the programme is a form of foreign direct investment (FDI)
and in the case of Guyana, it is anticipated for growth, especially in light
of an election that is due shortly and expectations of expansions in the oil
sector.
Cabrits Resort and Spa Kempinski pool area under construction in
Dominica.
Dominica and Anguilla are expected to post strong growth following
reconstructing efforts post hurricanes Maria and Irma in 2017.
“This growth obviously affects unemployment and the rates have been
coming down for both producers and service providers. The average rate
has been on a decline. But one worrying aspect is youth unemployment
and the employment among women."
In Belize, for example, the male unemployment rate is five per cent while
for females it is 11 per cent.
In Grenada, the male unemployment rate is 20.6 per cent and for females
is 26.8 per cent, while in Jamaica, which historically had a difference in
unemployment rates between men and women, the male rate is 5.5 per
cent and the female rate about twice that.
“Jamaica has made significant progress on the heels of the International
Monetary Fund (IMF) agreement which I think has expanded. Inflation has
been subdued in the region and this has been the case for some time.
There are many reasons for this. Obviously suppressed demand, the
general decline in oil prices but this issue of inflation in the Caribbean
being subdued is important because it helps pensioners and fixed income
owners.”
Subdued inflation is a good thing and the expectation is that this trend will
continue for some time consequent on lower oil prices.
A fisherman cleans a 25 pound dolphin fish at the Roseau Fisheries
complex.
Strengthening investment is a key condition for inclusive and sustainable
economic growth, he said. The average fiscal balance across the
Caribbean improved from -2.4 per cent of GDP to -2.0 per cent. Four
economies posted surpluses, but four others, Anguilla, Dominica,
Montserrat and Suriname, regressed.
For TT, Alleyne said it is expected this country would have a 1.6 per cent
GDP growth for 2019.
“There is a need for the government to place diversification higher on the
agenda, however the process of diversification will take time and it is not
an immediate outcome. I think it has to go across administrations, not just
the government of the day. They have to commit themselves to a few
sectors in activities and consistently encourage entrepreneurial activities
in those areas.”
Going forward, Alleyne suggested the region strengthen capital
investment, including building technical capacity for prioritising and
managing the capital investment programmes. Countries also need to
upgrade key sectors like tourism through improving training and
infrastructure while focusing on expanding the domestic private sector for
exports in non-traditional areas, for example in education and healthcare,
through trade facilitation.
He also suggested that countries, especially TT and Jamaica, could lock in
the gains of fiscal consolidation through institutional reforms, which could
strengthen social security programmes as well as reduce crime and citizen
insecurity.
<< Back to news headlines >>
$104 million for housing development in Dominica Thursday 8th August, 2019 – Dominica News Online
Prime Minister and Minister for Finance Roosevelt Skerrit has announced a
$104 million loan from the World Bank for the expansion of the
government’s housing programme.
“In our furtherance of our efforts to house the nation we successfully
negotiated a financial package with the World Bank to the tune of $104
million,” Skerrit said.
He said there is no doubt that this substantial sum of $104 million will cater
for a significant number of families.
According to Skerrit, thus far his government has established the Project
Implementation Unit and commenced public consultation both of which
are pre-requisites to the implementation of the project.
He thanked the World Bank for partnering with the government.
The prime minister said the government has also given the Dominica
Social Security (DSS) the green light to proceed with the use of their lands
located at Warner for the development of a gated community to cater
for young professionals, the middle class and Dominicans in the Diaspora.
“This housing development is open to the private sector and any other
investor to partner with the DSS to make this a reality,” he stated.
Skerrit said this is a huge opportunity for persons on island and others in the
diaspora.
<< Back to news headlines >>
European shares bounce on China respite Thursday 8th August, 2019 – Reuters
European shares rose for a second day on Thursday, as investors took
heart from a stronger-than-expected rebound in Chinese exports and
steadying of the yuan after a week of turmoil sparked by an escalation in
U.S.-China trade tensions.
The pan-European STOXX 600 index was up nearly 1% with more than 91%
of the companies on the index in positive territory, recovering from a
three-day rout that began late last week.
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Trade-sensitive tech .SX8P and basic resources .SXPP indexes led the gains,
with no sector in the red.
Data showed July exports in China rose 3.3% from a year earlier, the
fastest since March, overturning analyst forecasts for a 2.0% drop. Imports
fell almost 6% although that was not as bad as a consensus forecast for an
8.3% drop.
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The yuan recovered some ground against the dollar, although China’s
central bank set its official midpoint below the seven to the dollar
threshold for the first time since the global financial crisis.
“The yuan fixing was an important signal from China that investors are
taking comfort from and it was also a move to prohibit capital outflows
from China,” said Teeuwe Mevissen, Senior Market Economist at
Rabobank.
Fears the U.S.-China trade war may tip the world into recession have
pushed investors to pile into bonds and gold and prompted central
bankers around the world to get ahead of the storm clouds by easing
monetary policy.
Earnings from German companies were in focus with disappointing
second-quarter sales from sportswear firm Adidas (ADSGn.DE), sending its
shares down 1.5%, while Thyssenkrupp (TKAG.DE) gained 2% in the face of
a fourth profit-warning that traders said was already largely priced in.
Lighting group Osram (OSRn.DE) was the biggest decliner on STOXX after
its top shareholder rejected a 3.4 billion euro ($3.81 billion) takeover offer
from private equity firms Bain and Carlyle.
London's FTSE 100 .100 lagged as a rising pound GBP= pressured the index,
which is packed with exporters. Hargreaves Lansdown (HRGV.L), however,
jumped 6% after the British fund supermarket posted a forecast-beating
increase in full-year assets.
<< Back to news headlines >>
UK pay growth for new staff hits more than two-year low in July - REC Wednesday 7th August, 2019 – Reuters
Pay for permanent staff hired in Britain through recruitment agencies rose
in July at the slowest rate since April 2017, according to a survey that
suggested Brexit uncertainty continues to weigh on the labour market.
The monthly report from the Recruitment and Employment Confederation
and accountants KPMG also showed companies reduced the volume of
new permanent staff for a fifth month running, albeit at a slower pace
than in June.
Overall, the survey added to signs that the labour market, the strongest
feature of Britain’s economy over the last few years, may now be on the
wane. Last week, the Bank of England said it saw signs of softening, with
employment growth.
“Businesses continue to take a cautious approach to hiring as Brexit and
economic uncertainty linger,” James Stewart, vice chair at KPMG, said.
“Uncertainty is also impacting the supply of labour, as people are
choosing to sit tight until the outlook is clearer.”
Official labour market figures covering the three months to June are due
on Tuesday.
<< Back to news headlines >>
UK housing market slows after June bounce - RICS Wednesday 7th August, 2019 – Reuters
Britain’s housing market softened in July after a small bounce the month
before, a survey showed on Thursday, adding to signs that Brexit worries
are again making households cautious about shopping for a new home.
The Royal Institution of Chartered Surveyors said its headline price
indicator fell back to -9 from a 10-month high of -1 in June, a steeper
decline than any economist had predicted in a Reuters poll.
The news follows figures from mortgage lender Halifax on Wednesday
which showed house prices fell in July for a second consecutive month.
“The latest RICS results will provide little comfort for the market with all the
key indicators pretty much flatlining”, RICS chief economist, Simon
Rubinsohn, said.
“The forward-looking metrics on prices and sales also seem to be losing
momentum as concerns about Brexit and political uncertainty heighten,”
he added.
Surveyors’ average forecast for house prices over the next 12 months
dropped to -0.1% from +0.6% in June, its first time below zero this year,
while the average annual price increase expected over the next five
years dropped to 2.1%.
Britain’s new prime minister, Boris Johnson, has said he is determined to exit
the European Union on Oct. 31, even if it means leaving without a deal -
something many businesses think would lead to major economic
disruption.
The housing market has already slowed since June 2016’s Brexit vote,
though the effect has been concentrated in London and neighbouring
areas, where prices were already high.
July’s RICS data did show an improvement in the number of inquiries from
potential buyers for a second consecutive month, but the number of sales
fell.
RICS said more than two thirds of homes priced at over 1 million pounds
failed to sell for their asking price, in contrast to homes priced under
500,000 pounds, most of which sold for at least what they were advertised
for.
Demand from tenants to rent homes also strengthened to its highest since
late 2016, and surveyors predicted rents would rise at their fastest in three
years as fewer small landlords wanted to enter the market due to less
favourable tax treatment.
<< Back to news headlines >>
Disposal of Petrojam's contaminated ethanol ends September Thursday 8th August, 2019 – Jamaica Observer
MINISTER of Science, Energy and Technology Fayval Williams says that
individuals or companies in possession of contaminated ethanol should be
required to disposed of them in accordance with the environmental laws.
The minister made the statement as she announced plans to remove
181,000 US gallons of contaminated ethanol, valued at $45 million, from
the premises of the Petrojam oil refinery on Marcus Garvey Drive in
Kingston to the Caribbean Cement Company Limited's (CCCL) plant in
Rockfort for incineration by the end of September.
The contaminated ethanol was located on the Petrojam premises during
the investigations into the “bad gas” issue in 2015/16 and, according to
the minister, became contaminated at the point of importation which
coincides with maintenance and flushing operations geared towards
replacement of pertinent piping/hoses for loading and off-loading
ethanol.
“The ministry thinks that all suspected contaminated fuel should be
quarantined by the person in possession of it immediately on discovery,
and the Petroleum Inspectorate should be informed within 24 hours of the
disposal,” Williams told the House of Representatives, recently.
She noted that the recommendations were among 12 such proposals
from the Petroleum Trade Reform Committee (PTRC) which was created in
January 2016, a month after the controversial “bad gas” issue set off
alarms among petrol users, and whose recommendations are currently
being addressed to beef up regulations to protect Jamaicans from the
effects of contaminated fuels.
Williams said that, based on the changes being made to the petrol trade
legislation, following the “bad gas” experience, all instances of
contaminated petroleum must be reported to the Petroleum Inspectorate
within 12 hours of discovery, and petroleum products re-treated after
contamination will have to be certified for quality by the Petroleum
Inspectorate prior to its release into the trade.
Petrojam Ethanol Limited (PEL) was established in 2005 as a partnership
between the Jamaican Government and a Brazilian company to secure
feedstock from Brazil for processing in a 40-million US gallon plant which
had a value of $823 million. The company became totally Jamaican in
2008, but shifted from production to importation in 2013 and stop using the
dehydration plant.
In a case study report on the plant, the Auditor General's Department said
it was not assured that value for money was being obtained from the
investment and called the objective of locally produced ethanol
“misaligned” in 2017.
Williams noted that her ministry was aware that the roughly 4,300 barrels of
contaminated ethanol had been isolated in three storage tanks at the
Petrojam Refinery at Marcus Garvey Drive in Kingston since 2015.
She said that where the contaminated petroleum could be treated by
the bulk distributor in possession of it, a new quality certificate after
appropriate testing by the Bureau of Standard Jamaica is to be given to
the retailer prior to sale of the treated product to the public.
She said, however, that various disposal alternatives were explored and
incineration emerged as the method of choice for the Petrojam ethanol.
Based on discussions between PEL and CCCL it was discovered that
waste disposal by incineration formed part of the cement plant's social
responsibility drive so, at the end of February 2019 the CCCL formally
indicated to the ministry that it could use that facility to dispose of the
contaminated fuel.
However, leading up to CCCL formally indicating that they would be able
to dispose of the contaminated ethanol, it still required an application be
made by PEL to the National Environment and Planning Agency (NEPA)
for the grant of an environmental permit. PEL made the necessary
application on June 28 this year, and the permit to undertake the
transportation and disposal was issued on July 18.
The transportation of the contaminated ethanol to the cement company
commenced on Friday, July 25, using certified tanker wagons and will
continue over an eight-week period at a frequency of three trips per
week.
Williams said that her ministry sought the assistance of the commissioner of
police to provide security escort during the transportation process.
Additionally, the opening of the tank and loading of the truck was
monitored by Customs, Tax Administration of Jamaica (TAJ), Bureau of
Standards, National Regulation and Compliance Authority, Ministry of
Finance and the Public Service, and the National Solid Waste
Management Authority.
She said that all the necessary approvals were sought from the various
entities, including Customs and TAJ who verified that, given the non-cash
nature of the transaction, there was no tax nor customs duties applicable.
<< Back to news headlines >>
Cuba reveals health, hotel, other service earnings Friday 2nd August, 2019 – Reuters
Cash-strapped Cuba on Friday for the first time published details of its
foreign exchange earnings from services such as telecommunications,
hotels, health and education assistance, in an apparent concession to
creditors.
Service exports make up most of the Communist-run country’s foreign
exchange earnings. But for decades the Caribbean island nation has
refused to publish details despite requests by foreign governments and
businesses.
A number of western diplomats involved in debt and trade talks with
Cuba in recent months have expressed frustration that officials have not
provided details on the country’s financial situation.
A common complaint of potential foreign business partners is that their
Cuban counterparts refuse to provide information needed for proper due
diligence, for example, when discussing potential collateral through
telecommunications or transportation earnings.
According to the report on the National Statistics Office web page
(here.pdf) the biggest export earner in 2018 was health services at $6.4
billion, followed by "support services" at $1.3 billion.
The report on page 47 said hotel and related services garnered $970
million, followed by telecommunications at $722 million and transportation
and support services, which includes everything from airlines to docking
fees, at around $600 million.
The report did not provide data for previous years.
The country’s foreign exchange earnings have declined in recent years in
tandem with the implosion of its ally and main economic partner,
Venezuela, forcing the government to adopt austerity measures aimed at
limiting imports.
Total exports were $18.6 billion in 2013 and $14.5 billion last year. Imports
fell from $15.6 billion to $12.6 billion.
The economy has stagnated and tough new U.S. sanctions on some 175
Cuban companies, tourism and investment are expected to worsen the
situation in 2019.
Cuba last reported its foreign debt at $18.2 billion for 2016 and considers
its current account and reserves state secrets.
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Amid rising hunger, Venezuela plantain crops threatened by fungus –
agronomists Wednesday 7th August, 2019 – Reuters
Venezuela’s banana and plantain crops face potential infestation of a
fungus already effecting neighbouring Colombia, an agronomists’
association said on Wednesday, potentially devastating one of
Venezuela’s main foods amid rising hunger.
A hyperinflationary economic collapse has left millions of the OPEC
member’s citizens unable to obtain enough calories and has pushed diets
toward starchy staples that grow readily in its tropical climate.
Venezuela’s banana and plantain crops are concentrated in the state of
Zulia on the border with Colombia, where 150 hectares (371 acres) of
bananas were quarantined in July on suspicion they were infested by the
Fusarium R4T fungus.
The fungus causes a malady popularly known as Panama disease and
can remain in the soil for up to 30 years by attacking the roots of plants.
“The devastation of the crops would be very fast” if the fungus reached
Venezuela, Saul Lopez, president of Venezuela’s Association of
Agricultural Engineers, said at a news conference.
Venezuela has a combined total of around 70,000 hectares (173,000
acres) of bananas and plantains under plantation, Lopez said, adding
that the economic crisis has left the country without personnel to address
the problem.
The information ministry did not immediately reply to a request for
comment.
The flow of people and food between Venezuela and Colombia creates
a significant possibility that the fungus could reach Venezuela, said Edison
Arciniega of food-security focused non-profit Citizenship in Action.
A contagion “would imply the disappearance of the main elements of
the Venezuelan diet,” Arciniega said, noting that Venezuelans consume
around one kilogram (2.2 pounds) per month of plantains and bananas.
Nutrition experts for years have said Venezuelan diets have become more
dependent on starches because of shortages or prohibitive costs of more
complete meals including beans, dairy or meat.
Venezuelan President Nicolas Maduro says the country is a victim of an
“economic war” led by political adversaries and exacerbated by United
States sanctions.
His critics say failed policies and chronic corruption are to blame for the
crisis.
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Venezuela government to skip Barbados talks to protest U.S. sanctions Wednesday 7th August, 2019 – Reuters
Venezuela’s government will skip a round of Norway-brokered talks on
Thursday and Friday to protest a new set of U.S. sanctions meant to force
President Nicolas Maduro from power, the Venezuelan information ministry
said on Wednesday.
U.S. President Donald Trump on Monday imposed a freeze on Venezuelan
government assets in the United States and blocked U.S. citizens from
conducting business with Maduro’s government, increasing pressure on
him to quit.
Maduro’s government said its delegation was withdrawing from the round
of talks in Barbados aimed at resolving Venezuela’s political crisis with
allies of opposition leader Juan Guaido.
The two sides began meeting there in July to seek a resolution to the
political stalemate.
“Venezuelans have noted how the leader of the opposition delegation,
Juan Guaido, has celebrated and promoted these actions that are
harmful to national sovereignty,” the information ministry said in a
statement.
“Venezuela is willing to review the mechanisms of this process such that its
continuation is effective and in tune with the interests of the people.”
Legislator Stalin Gonzalez, a member of the opposition delegation,
accused the government of backtracking on its commitment to the
dialogue, which began in Oslo in May.
“They’ve spent days saying they believe in peace and in the Oslo
mechanism, (but) they fear the possibility of true political change in the
country,” Gonzalez wrote on Twitter.
Guaido, who has been recognized by more than 50 countries including
the United States as Venezuela’s legitimate leader, at a rally on
Wednesday said the sanctions are “penalties for those who steal and
profit from misery.”
In January, Guaido invoked the constitution to assume a rival interim
presidency on the grounds that Maduro’s 2018 re-election was fraudulent.
He said on Wednesday that Maduro could help the country by
abandoning the presidential palace, Miraflores, “that way the sanctions
will be lifted tomorrow.”
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China's CITIC Capital raises $2.8 billion in its biggest private equity fund Wednesday 7th August, 2019 - Reuters
CITIC Capital, the flagship alternative investment arm of Chinese financial
conglomerate CITIC Group [CITIC.UL], said it raised $2.8 billion in its fourth
China buyout fund, bolstering its ability to cut deals in the world’s second-
largest economy.
The CITIC Capital China Partners IV, the firm’s biggest private equity fund
to date, received “strong” interest from a mix of existing and new investors
including pension and sovereign wealth funds, insurers and family offices,
CITIC Capital said in a statement on Thursday.
Like the previous funds, the latest fund, which is dollar-denominated, will
seek control-investment opportunities with a China angle across sectors,
including consumer, healthcare and technology, it said.
CITIC Capital joins several China-focused private equity and venture
capital managers who raised $17.3 billion in dollar-denominated funds in
the first half of 2019, versus $13 billion over the same period last year,
according to data provider Preqin.
Founded in 2002, the firm has over 200 portfolio companies and is known
for its investment in leading Chinese delivery business SF Express and the
Chinese unit of McDonald’s (MCD.N).
In 2016, it also joined a consortium here formed by gaming and social
media heavyweight Tencent Holdings Ltd (0700.HK) to acquire Finnish
game developer Supercell.
With the new fund, Hong Kong-based CITIC Capital manages over $26
billion in assets, with investment focus on traditional private equity deals,
real estate and asset management. It raised $1.58 billion for its third China
buyout fund in 2017.
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China surprises with best export growth since March, but imports remain
weak Wednesday 7th August, 2019 - Reuters
China’s exports unexpectedly returned to growth in July on improved
global demand despite escalating U.S. trade pressure, but the rebound
may be short-lived as Washington prepares to slap even more tariffs on
Chinese goods.
Analysts say a sharp drop in the yuan currency this week may offer only
limited help for Chinese exporters, who are facing additional U.S. levies
next month, shrinking profit margins, and sputtering demand worldwide.
July exports rose 3.3% from a year earlier, the fastest since March and
more than the most optimistic estimate in a Reuters poll, customs data
showed on Thursday. Analysts had expected a 2.0% drop after June’s 1.3%
fall.
But imports remained weak, declining 5.6% and highlighting sluggish
domestic demand as China’s economy struggles to get back on firmer
footing. Still, the drop was less than an expected 8.3% and June’s 7.3%.
The better-than-expected trade readings helped buoy Asian stock
markets, which suffered a heavy selloff earlier in the week as the Sino-U.S.
trade war intensified and the yuan skidded to 11-year lows.
While China’s exports to the U.S. continued to shrink in July in the face of
stiffer tariffs, shipments picked up to Europe, South Korea, Taiwan and,
most noticeably, Southeast Asia (ASEAN).
“It could suggest that some exporters are trying to diversify their export
regions, it could also be due to manufacturers’ relocations to ASEAN (from
China),” said Betty Wang, a senior China economist at ANZ.
“This hopefully can offset some of the downside risks from the U.S. China
bilateral trade.”
Washington is clearly watching shifts in China’s trade patterns as the trade
dispute wears on. The United States recently warned Hanoi that some
export goods labelled “Made in Vietnam” were of Chinese origin.
An official Chinese think tank attributed the rise in exports partly to
Beijing’s Belt and Road initiative, a program that aims to boost business
and trade ties with dozens of countries across the world.
“This year, China did not only increase its market share in major
economies like the European Union, what’s more outstanding is the
growth rate in emerging markets is very clear, especially the countries
who we work with on Belt and Road,” said Yan Min, the director of the
forecasting department at the State Information Centre, according to
state media.
NO QUICK TURNAROUND IN SIGHT
China’s exporters and their U.S. customers have been whipsawed in
recent months by trade uncertainties, with the fallout rippling through
global suppliers from Germany to Singapore.
The United States raised tariffs on a large number of Chinese goods in
May, after trade negotiations broke down, and Beijing retaliated.
A brief ceasefire agreed in late June has proved short-lived, after Trump
vowed last week to impose a 10% tariff on $300 billion of Chinese imports
from Sept. 1, which would extend levies to effectively all of the goods
China sells to the United States.
In response, China said it would stop purchasing U.S. agricultural products.
China’s trade surplus with the United States stood at $27.97 billion in July,
narrowing from June’s $29.92 billion.
But it reached $168.5 billion in the first seven months of 2019, highlighting
continued imbalances which have been a core complaint of Trump’s in
his administration’s negotiations with Beijing.
China’s July exports to the United States fell 6.5% year-on-year, while
imports from America slumped 19.1%.
DISPUTE WIDENING TO OTHER AREAS, CURRENCIES
The dispute between the world’s largest economies is spreading beyond
tariffs on goods to other areas such technology and in recent days
currency policy.
On Monday, China allowed the yuan to depreciate past the 7 yuan-per-
dollar level for the first time in more than a decade, triggering worries of a
global currency war. Hours later, Washington branded Beijing a “currency
manipulator”.
While China has stepped in to stabilize the yuan in recent sessions, markets
remain on edge in case of further weakness.
“Looking ahead, exports still look set to remain subdued in the coming
quarters as any prop from a weaker renminbi should be overshadowed by
further US tariffs and broader external weakness,” said Julian Evans-
Pritchard, senior China Economist at Capital Economics, in a note on
Thursday.
Pressured by weak demand at home and abroad, China’s economic
growth cooled to a near 30-year low of 6.2% in the second quarter. Other
major data over the coming week is expected to show a loss of
momentum in July, reinforcing views that Beijing will need to roll out more
support measures.
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RBI moves unlikely to ease pain for India's struggling shadow banks Wednesday 7th August, 2019 – Reuters
India’s central bank outlined two measures on Wednesday aimed at
easing liquidity pressures on crisis-hit shadow banks, but industry insiders
say the moves, while positive, are unlikely to lead to any substantive
improvements in the troubled sector.
The Reserve Bank of India, which also cut its benchmark policy rate by 35
basis points on Wednesday, said it would allow banks to increase their
exposure to a single non-banking finance company (NBFC). The move
was aimed at boosting credit to cash-strapped NBFCs, or shadow banks.
The RBI also allowed banks to classify loans to NBFCs for key areas such as
agriculture, housing and small and medium businesses - up to certain limits
- as priority sector lending, in a bid to keep credit flowing to the parts of
the economy where most Indians work.
NBFC’s have been battling a credit crunch since IL&FS, or Infrastructure
Leasing & Financial Services, collapsed in late 2018 amid fraud
allegations. The fall of IL&FS, a behemoth in the space, pushed up
borrowing costs for rivals and has sharply impacted consumer spending
and stung sectors such as real estate and autos that are big drivers of
consumer demand.
Senior executives from at least three NBFCs, however, said the moves
announced by the RBI on Wednesday, coupled with other recent
changes, were unlikely to ease the pressure substantially.
“Banks and financial institutions have become so risk-averse that they just
aren’t keen on increasing their exposure to NBFCs right now, so even
though the measures are positive the scenario is unlikely to change until
the economic environment improves,” said the finance head of one
NBFC, who asked not to be named as he was not authorized to discuss
the matter with the media.
INCREMENTAL STEPS
Wednesday’s moves were the latest in a series of measures rolled out by
the government and the RBI over the last few months to ease liquidity for
NBFCs, but so far the initiatives have not yielded significant benefits.
“Today’s steps are marginally better from the ones taken earlier, but even
these seem to be merely incremental in nature considering the current
market,” said the head of another small NBFC, who also asked not to be
named.
Even though the RBI has been focused primarily on improving liquidity, RBI
Governor Shaktikanta Das said on Wednesday that the regulator was also
keen to ensure that there were no collapses of any large, systemically
important NBFCs.
Dewan Housing Finance Corp Ltd DWHN.NS, one of the largest housing
finance companies in India, which owes nearly 1 trillion rupees ($14 billion)
to its creditors, is currently scrambling to get its lenders to sign-off on a
restructuring plan that will place a moratorium on repayments, even as it
seeks funds from banks to start retail lending.
At a press briefing after the RBI policy meeting, Das acknowledged that
any benefit from the new directives was contingent on banks’ willingness
to increase their lending to the shadow sector.
“It’s for banks to make their own risk assessment and take the call,” he
said.
Analysts said the tweak in the priority sector lending rules may work in
favour of smaller, retail-focused NBFCs that have lately struggled to raise
funding, but may not help bigger shadow banks that have been the
hardest hit.
“Larger corporate-focused shadow banks that are struggling more will see
only incremental benefits,” said A.M. Karthik, financial sector head at
rating agency ICRA.
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