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Here are some of the top and most relevant business news highlights for the week Oct 9 – 15, 2016
- Jamaica could have a new three year IMF agreement before year end. The IMF release said
“The IMF team and the Jamaican authorities have reached a staff-level agreement on a new economic program for Jamaica that would be supported by a 36-month Stand-By Arrangement (SBA) with the IMF with access of SDR 1.2 billion (equivalent to 312 percent of quota or about US$1.7 billion). If approved by the IMF’s Executive Board, SDR300 million (about US$430 million) would be immediately available. Given the Bank of Jamaica’s comfortable foreign reserves position, the Jamaican authorities have indicated their intention to treat the SBA as precautionary, that is, effectively an insurance policy against unforeseen economic shocks that are beyond the control of Jamaica.
- Mortgage growth – Secondary and reverse mortgages are being considered for Jamaica. The Prime Minister who made the announcement, also mentioned at a Realtor Association of Jamaica Conference that Mortgage Backed Securities are being considered for Jamaica
- Business and consumer confidence remain the highest it has been in any quarter over the last 15 years, despite declining slightly over the last two quarters since the February 25, 2016 election
- A motion has been moved by Government Senator Matthew Samuda to ban the importation and manufacture of Styrofoam and plastic bags in Jamaica. However, at least one big manufacturer has not been in full support. Wysinco, which is the only manufacturer of Styrofoam says we should look at the impact this will have on small businesses. The full motion is to
…’ban the importation of plastic bags below 50-gallon capacity and all finished goods made from styrofoam; and curtail the production of those items in Jamaica, unless they include an enzyme capable of making them biodegradable’
- The government also announced plans to spend J$82m to celebrate its athletes from Rio 2016, however some entertainers are not in support – suggesting that the hospitals, disadvantaged youth and even recently damaged haiti would benefit more from the funds
- The government announced it will be rolling out a new national ID system by 2018 which should make doing business in the island much easier
- Suggestions are being put forward to use the money that would fund the increase in the income tax threshold to fight crime. The suggestion came from Co-Chairman of the Economic Programme Oversight Committee, Richard Byles. However Deputy Chair of the Economic Growth Council, Dr Nigel Clarke does not agree. Nigel believes that while crime fighting is good, that is a separate issue from increasing the threshold and moving from direct to indirect taxation.
On the markets…
- Change of leadership at Carib Cement as Chairman Chris Dehring steps down and Deputy Parris Lyew-Ayee takes the reigns. He also resigned as chairman of Trinidad Cement Ltd
- JMMBGL was one of the more popular stocks this week following announcements that it was finally granted a commercial banking license. After the announcement the stock had consecutive days of price increases (to as high as 15.50) before ending the week at J$13.61. It is trading at ~$14.53 on the TTSE (when converted to J$).
