Chief economist for Latin America and the Caribbean, Carlos Végh, has deemed the region's fiscal policy as precarious with an urgent need for further adjustment, as growth in China and the United States continue to trend upwards.

Végh gave the prescription Wednesday in a World Bank report titled 'Growth vs Inflation, Latin America and the Caribbean's Difficult Balance'. He said that since the international environment will be relatively stable in the near future, the region, above all Jamaica with a debt to GDP ratio of over 80 per cent, will now have to strengthen its own growth sources by means of structural reforms and increasing international trade both inside and outside the region.

Already the island is undergoing a number of reforms under existing arrangements with the International Monetary Fund, but Jamaica could be in need of further reforms to stimulate the economy while guarding against further depreciation of the local currency and increased inflation.

Végh said that while growth for Latin America and the Caribbean has rebounded to 1.2 per cent for this year; commodity prices, growth rate in the United States and China, as well as the measurement of global liquidity in the international financial market will now force the region to deepen structural reforms such as educational, labour, pensions, and infrastructure development if it truly wishes to see growth beyond 1.2 per cent.

“Let's remember that for almost seven years we have been growing at a rate of 5 to 6 per cent and now we will have to depend much more on ourselves,” he said.

“If you look at the growth of the US as well as the growth of China, then you will indeed agree that it is only reasonable to conclude that in the immediate future these external factors may be relatively stable, so they may not be helping us, but they will not be detrimental either and this has an important consequence. As opposed to what used to happen during the golden decade 2003-2013, where growth was perhaps due especially to external factors, the fact that these will now be stable means that the region will have to strengthen to find its own sources of growth,” he said.

The chief economist, who noted that fiscal adjustment across the region is inevitable, said the change has to be gradual since the region is already going through times of relatively low growth, and it is not necessary to conduct a fiscal adjustment that results in a shock.

Of the region's economies, Végh said 28 of 32 are expected to have a fiscal deficit in 2017, reflecting a weak situation and that will continue to increase public debt. He pointed out that the average public debt in Latin America and the Caribbean stands at a worrisome 58.7 per cent, with six countries that have public debt to GDP ratio above 80 per cent, Jamaica being the worst.

“That means that the fiscal situation is rather precarious. It also means that, among other things, there is a fiscal space that is quite limited. We would say zero, which means that there is no leeway for any form of fiscal policy which is anti-cyclical in nature. So the issue having to do with the monetary policy becomes paramount, which is the main approach in the report,” he said.

He further recommended that the central banks of Latin America and the Caribbean follow Chile, Brazil and Peru in lowering interest rates in order to stabilise and stimulate the economy.

“And if it is necessary to do this after stabilising the rate of exchange and the inflation, that would be very good,” he continued.


Végh, in questioning whether central banks are capable of bringing down the interest rates of monetary policy to stimulate the economy without threatening depreciation of local currencies and inflation, noted that they have two options.


“They can increase the monetary interest rate to defend their exchange rate and to combat inflation, even though this may actually worsen the recessionary conditions. This is what we would call a pro-cyclical monetary policy,” he said.


“Or the central banks could opt to lower the monetary policy rate to stimulate economic activity. But by so doing they run the risk of that drop in interest rates leading to a faster depreciation and inflationary acceleration. So economic agents may fear that this may lead to financial instability in the economy, and if that is the case, that could cause an even worse depression and also lead to capital, more depreciation and consistently the economy could easily fall into a vicious cycle,” he reasoned.

Red Stripe Jamaica is this year's winner of the Governor General's Award for Manufacturer of the Year (sponsored by EXIM Bank). The award was especially relevant as the Heineken-owned company has recently returned its US-based manufacturing to Jamaica, after temporarily moving a part of its production to Pennsylvania in 2012.

The awards banquet, currently in its 49th year, brings together Jamaica's small, medium and large manufacturers and awards them for innovation and excellence in a variety of areas. The event was held on Saturday at The Jamaica Pegasus in New Kingston.

Red Stripe beat two other competitors for the award – Wisynco and PA Benjamin.

According to the JMA, to be declared Manufacturer of the Year, the applicant goes through a rigorous quantitative and qualitative selection process which analyses and explores the company's productivity, quality standards and certification, export operations, training and development of personnel, contribution to community development and environmental preservation, as well as achievements in research and development and continued innovation.

Red Stripe also walked away with a second award, The Robert Lightbourne Award for Competitiveness.

Meanwhile Seprod took the Prime Minister's Award for Champion Exporter for large exporters.

PA Benjamin Manufacturing Co. Ltd may have missed the top award, but it did win several others, including the the Product Group Awards for Chemicals, Cosmetics & Pharmaceutical Products, the National Certification Body of Jamaica (NCBJ) Award for Quality and Standards, the Nicola Gordon-Rowe Buy Jamaican Award, and the Champion Exporter Award, JMA President's Cup – Medium Exporter.

Other notable winners included Rainforest SeaFoods, who received the Vision 2030 Award for Corporate Social Responsibility and the Product Group Awards for Food & Agro Products; National Baking Company which won the award for Productivity; and Newport Fersan (Ja) which won the Breakthrough Product of the Year award with their Manni-Plex Liquid Fertiliser.

The Eddie Hall Award for New Manufacturer of the Year went to skin care company Ansel Development Ltd – Ettenio, while the Ray Hadeed Award for Best Small and Medium-Sized Enterprise went to Spur Tree Spices.

Boss Furniture Company Ltd took two prizes – The Product Group Awards for Furniture, Bedding & Wooden Products, and the Champion Exporter Award – Jamaica Promotions Corporation's Award for Small Exporter. Those awards were collected by Omar Azan, CEO for Boss Furniture and the immediate past president of the JMA.

Other winners included Tritronic Electronics Ltd for the Product Group Award for Electrical, Electronic & Automotive Products, while Agri & Industrial Packaging Ltd won the Product Group Award for Printing, Packaging & Paper Products. AMECO won the Best Support Service Award.

Walmart is all about online, anticipating digital sales next fiscal year will rise about 40 per cent and that it will double the number of United States kerbside locations for online grocery shoppers at its stores.

But the world's largest retailer continues to scale back new store growth in the US, with plans to open only 25 in its fiscal year 2019, which ends January 2019. That compares with opening 230 new US stores during fiscal 2016.

The retail behemoth is predicting net sales growth at or above 3 per cent, driven by online sales and growth from existing stores for the next fiscal year.

The company reiterated its per-share earnings guidance for next year and launched a two-year, US$20 billion share repurchase program.

Shares rose more than 4 per cent in to US$83.57 on the news in morning trading.

"No doubt we are in a transformational period of history," said Doug McMillon, CEO of Walmart Stores Inc, in an address Tuesday to investors at an annual meeting in Bentonville, Arkansas. "Our future is looking more digital."

The retailer is armouring up online to take on and more traditional rivals, like Target. The company paid more than US$3 billion for the online retailer Jet last year to speed its evolution. It's been acquiring smaller players like ModCloth, Moosejaw and Bonobos. It's also deploying digital kiosks called Pickup Towers at a hundred of its stores which spit out products bought on

The company has fast expanded the number of US stores that allow online grocery shoppers to pick up orders at the curb. Currently 1,000 US locations are participating.

The company went live with voice-activated shopping with Google in answer to Amazon's Alexa-powered Echo devices. Walmart said customers can now start shopping for more than 2 million Walmart items via Google Assistant as well as Google Express and its app. Walmart announced its partnership with Google in August.

And starting next month, returns may be getting easier. Customers can scan goods they no longer want with a smartphone and drop them off at a customer service desk. Walmart says that will take 35 seconds or less. Returns right now take about four times that, not including any wait in line.

Earlier this year, Walmart revamped its shipping program and now offers free, two-day shipping for online orders of its most popular items with a minimum purchase order of US$35.

But as Walmart moves into the digital space dominated by Amazon, Amazon is encroaching on the physical realm to win over more customers.

In August, Amazon closed on its US$13.7 billion purchase of Whole Foods Market and quickly lowered prices on key products. It also cut a deal with Kohl's that allows for the return of Amazon goods at stores in Los Angeles and Chicago, which are packaged and shipped out by workers there.

Moody's lead retail analyst Charlie O'Shea said Walmart is giving shoppers a "compelling online alternative to Amazon" and views its online sales forecast as an "impressive goal, especially on the heels of the 30 per cent (growth) outlined at the 2016 investor meeting, which at the time seemed aspirational".


Walmart has increasingly linked its massive fleet of stores with online services, but the emphasis on expanding the number of stores it runs, at least in the near future, has ebbed. Walmart expects to open less than 15 supercenters and fewer than 10 Neighbourhood Markets in the US next year. It opened 40 new supercenters this year and last fiscal year, it opened 60 supercenters.


"The redeployment of significant capital expenditure dollars from new stores in the US to online improvements and store remodels, especially the 1,000 store increase in in-store grocery pickup locations, will help Walmart maintain its market-leading position in the US grocery segment," O'Shea said.

HAMILTON, Bermuda — Bermuda’s global insurers and reinsurers have already begun to pay claims on last month’s record-setting hurricanes Harvey, Irma and Maria. Ultimately, Bermuda market companies may fund a quarter or more of approximately $100 billion in aggregate insured losses from the events, according to preliminary estimates from the Association of Bermuda Insurers & Reinsurers (ABIR).

Bermuda-based commercial carriers represent the second-largest insurance hub outside London and are the leading providers of catastrophe reinsurance in the world.

“Bermuda’s global insurers and reinsurers first and foremost express their sympathy to those suffering from the loss of life, property, food and water from the recent storms,” said Kevin O’Donnell, ABIR chair and president and chief executive officer of RenaissanceRe Holdings Ltd. “At this time, we are helping in the best way we can – by forwarding billions of dollars to help begin and sustain recovery in Texas, Florida, Puerto Rico, the US Virgin Islands and the rest of the affected Caribbean and Southeast US.”

“Going forward, we are committed to helping our clients and their communities rebuild more resiliently, and supporting continued innovation to help close the insurance protection gap,” O’Donnell added. “By diversifying the financial risks of these disasters to a willing global private market, we can best reduce financial burdens on exposed communities, taxpayers and policyholders.”

Shortly after the storms ravaged regions across the Caribbean and United States, Bermuda reinsurers began wiring hundreds of millions of dollars to primary insurance company accounts impacted by the disasters, the association said.

The Bermuda share of hurricane losses will be aggregated from business segments including commercial insurers and reinsurers; captive, or self-insurance companies; catastrophe-focused managing general agents (MGAs); and alternative capital risk funds and pools. Based on historical experience, regulatory stress tests, and publicly announced preliminary estimates by listed companies, ABIR estimates the island’s insurance market may absorb 25 percent or more of insured-loss claims. Preliminary aggregated loss estimates put the total at approximately $100 billion for the three storms.

Bermuda reinsurers, including ABIR members, began reporting estimates of net insured losses last week.

“The value reinsurers provide is three-fold,” explained Brad Kading, ABIR’s president and executive director. “First, advancing cash for liquidity so insurance clients can pay consumer claims; second, transferring risk around the world and diversifying it, so the cost of hurricanes is not solely paid by policyholders and taxpayers in the affected area; and, third, by providing balance-sheet protection so while insurers are liquidating assets to pay claims, additional funds provided by reinsurers allow them to continue selling new insurance contracts daily and still meet regulatory capital targets. That helps consumers get repairs made faster and helps local economies to recover, rebuild and return to productivity.”

Bermuda’s global insurance groups hold market-leading positions and expertise in business segments ranging from property insurance and catastrophe reinsurance, to energy and excess liability. Since 2000, the market has contributed more than $50 billion towards US catastrophe losses, including 10 percent of the World Trade Center attack claims and a third of liabilities incurred during 2005’s Hurricane Katrina, the deadliest and costliest hurricane recorded to date, according to the National Hurricane Center, and hurricanes Rita and Wilma.

Bermuda’s reinsurance market fulfills a critical role internationally in the wake of the most devastating and costly natural disasters, said Kading.

“To successfully underwrite insurance for property exposed to natural and man-made disasters, global reinsurers pool risk to achieve a diversified portfolio,” he said. “Risk is accumulated from potential events around the world, and since such loss events are uncorrelated, global insurance groups can achieve and share with customers the benefits of diversification.”

Economists estimate an additional $70 billion in capital (40 percent more) would be needed to underwrite catastrophe exposures that global reinsurers currently manage if they were unable to diversify the risk by pooling onto a “flagship” balance sheet, according to ABIR.

With operating subsidiaries in the United States and Europe, and business in more than 150 countries, ABIR’s member companies wrote combined global gross written premium of $92 billion on a capital base of $124 billion at year-end 2016. They also provide more than a third of the capacity for Lloyd’s of London, and employ tens of thousands of people around the world, including more than 26,000 employees in the US, over 1,600 in Bermuda, more than 10,000 in Europe, and nearly 8,100 in Asia and Oceania. Ten large Bermuda reinsurers have $12 billion invested in US subsidiaries, the association said.

Bermuda’s reinsurance market was launched in the mid-1980s when the world’s first excess liability carriers were established by Fortune 500 companies to fill an acute capacity crunch. Successive waves of insurers and reinsurers were incorporated in the British Overseas Territory over the next two decades, raising billions of dollars in capital to meet market needs following major disasters. Today, 13 of the top 40 global reinsurers are based in Bermuda.

The Montego Bay Chamber of Commerce and Industry (MBCCI) will be staging its annual Expo 2017, western Jamaica's largest and most notable trade expo, from Friday to Sunday.

The biennial event will have as title sponsors, digital and print advertising firm, Yello Media.

This year it is being held under the theme 'Connecting Industries — Building Together' at the Montego Bay Convention Centre, and will serve as a platform for local businesses to showcase the best of Jamaica's goods and services with a specific focus this year on Jamaica's service industry.

According to Yello Media Jamaica's Marketing Manager Ayanna Kirton, partnering as title sponsors of this year's expo has offered Yello Media a great opportunity to forge meaningful partnerships with MoBay's business community.

“There has been a lot of growth in the city and we strongly believe that there is much more development to come. We have therefore partnered with the Chamber of Commerce and Industry to help push the progress along in any way possible,” she said.

The Montego Bay Chamber of Commerce and industry Expo is the largest event of its kind in western Jamaica, and one of Jamaica's leading trade expositions.

The highly acclaimed three-day trade exposition is now firmly established on Jamaica's business calendar, with this year being its 17th staging.

The MBCCI says that Expo 2017 will provide exhibitors with myriad networking and marketing opportunities; allowing sponsors greater visibility and leveraging possibilities. About 15,000 visitors are expected to view over 100 exhibitions paid out in 57,525 square feet of exhibition space.

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