Further erosion of foreign reserves puts Barbados dollar in danger – Moody’s

BRIDGETOWN, Barbados, July 23, 2014, CMC - With Barbados’ foreign reserves standing below the 2013 level, International credit rating agency, Moody’s has warned that strain could be put on the dollar.

“Any further erosion in reserves would likely put further pressure on Barbados’ currency, which is pegged to the US dollar,” Moody’s stated in a July 21 report.

The agency issued its analysis based on the Central Bank of Barbados’ fiscal first quarter report issued on July 15.

The analysis is titled, ‘Barbados’ Mounting Fiscal Challenges and Persistent Economic Weakness Are Credit Negative’.

Click here to receive free news bulletins via email from Caribbean360. (View sample)

“After recovering slightly during the previous three quarters, foreign exchange reserves have resumed their decline, and as of 30 June remained around 25 per cent below early-2013 levels,” Moody’s noted. “This decline occurred despite a slight recovery in long-term private financial inflows that traditionally help support the central bank’s international reserves.”

In its July report the Central Bank set Government’s financing needs for the remaining three quarters of the current fiscal year at BDS$300 million, to be financed by commercial banks, NIS, and other non-bank organisations.

But stating that the fiscal first quarter, ended in June, was an important test for the government’s ability to deliver its deficit reduction program introduced in August 2013, Moody’s raised the level of Government’s estimated financial needs.

Any further erosion in reserves would likely put further pressure on Barbados’ currency, which is pegged to the US dollar

“Given the larger budget gap in the last fiscal year, we now estimate that the authorities need a total adjustment of at least BD$450 million (5.2 per cent of projected 2014 GDP) to reach their deficit objective in the current fiscal year,” Moody’s stated.

Moody’s stated that although it expects Barbados’ fiscal consolidation to accelerate over the next three quarters, “it will remain constrained by revenue underperformance, difficulty reining in transfers and subsidies and rising interest costs.

“Consequently, we are adjusting our 2014 budget deficit projection to 8.5 per cent of GDP from 8.0 per cent, about two percentage points above the government’s target, with risks firmly tilted to the downside.”

View the original article here

Further erosion of foreign reserves puts Barbados dollar in danger – Moody’s

Supreme Court reserves judgement in Mandela bus-lane challenge

The Supreme Court has reserved judgement in the application by transport operators challenging the creation of  a lane on the Mandela Highway for Jamaica Urban Transit Company, JUTC, buses.

Lawyers for the operators, the JUTC, the police and the Office of  Utilities Regulation, OUR, completed arguments yesterday.

Justice Lennox Campbell is to rule next week whether leave should be granted to the operators to seek a judicial review. The operators want the Ministry of  Transport to change the use of  the dedicated bus lane.

They say it should not be exclusive to the JUTC and other public passenger vehicles should be allowed to use it.

View the original article here

Supreme Court reserves judgement in Mandela bus-lane challenge

Tale of two sponsors: LIME reserves comment on Powell...

TELECOMMUNICATION giant LIME yesterday refused to comment on its embattled brand ambassador, Asafa Powell.

Powell failed a drug test at the JAAA National Senior Championships after his sample returned traces of the banned substance oxilofrine (methylsynephrine), following his 100m finals on June 21 at the National Stadium.LIME has sponsored the athlete since 2005.“LIME reserves comment and awaits the outcome of investigations,” the company said in statement issued to the Business Observer.Powell, 30, had never before failed a drug test. It is hoped that his “B” sample will be tested by next week.LIME’s reaction is far different from the way Adidas handled news on Sunday of its star sprinter Tyson Gay returning a positive doping test. The following day, the sportswear giant suspended its sponsorship of Gay.“We are shocked by these recent allegations, and even if we presume his innocence until proved otherwise, our contract with Tyson is currently suspended,” Adidas said in a statement.The 30-year-old Gay, the American record-holder in the 100m, has been backed by Adidas since 2005.“During this time he has been a great ambassador for the sport of track and field and our brand,” Adidas, which is based in Herzogenaurach, Germany, said.The shoe and sports clothing maker is invoking the clause in Gay’s contract relating to doping.“Adidas has a clear policy on doping and drug use,” the company said. “Each of the agreements with our athletes include a clear clause which states that the agreement shall be terminated by Adidas if the athlete is found guilty of the possession or use of drugs or any other prohibited substance by the relevant governing sports body having jurisdiction over the athlete.”Gay, who won the 100 and 200m at US national championships last month, has said he will have his “B” sample tested soon, possibly as early as this week.Gay has pulled out of next month’s world championships in Moscow. He reportedly fought back tears as he spoke about his positive result on Sunday.“I don’t have a sabotage story. I don’t have any lies. I don’t have anything to say to make this seem like it was a mistake or it was on USADA’s hands, someone playing games,” said Gay. “I don’t have any of those stories. I basically put my trust in someone and I was let down.”Powell did not qualify individually for the championships, but it was hoped that he would be a part of Jamaica’s sprint relay team. The man who has run nearly 90 sub-10-second races, more than any other human being, said his “attitude towards doping regulations and testing is well known, and I willingly give samples whenever requested”. The results has left him “completely devastated”, he said.Powell was among five Jamaicans who, it was announced, had failed doping tests after the National Trials.Additional reporting by The Associated Press(L-R) Powell… brand ambassador for LIME since 2005. Gay… brand ambassador for Adidas since 2005

View the original article here

Tale of two sponsors: LIME reserves comment on Powell...