Home' Trinidad and Tobago Guardian : March 3rd 2016 Contents BG10 REGIONAL
BUSINESS GUARDIAN www.guardian.co.tt MARCH 3 • 2016
The Bahamas has successfully introduced a modern, tax-free
shopping scheme for visitors, with over 60 per cent of eligible
Bahamian merchants signing up since its launch six months ago.
The system was launched by tax-free shopping provider, Global
Blue, in partnership with the value added tax (VAT) and customs
departments in the Caribbean nation.
Global Blue's system introduces a standardised electronic platform
to the tax refund process, which means that retailers can sell a
wide range of products to tourists, minus VAT. The purchases are
recorded in standard format by retailers and then monitored elec-
tronically by the Customs Department.
"Following the introduction of VAT, we needed to ensure that
The Bahamas continued to be seen as a competitive shopping
destination," said Minister of State for Finance Michael Halkitis.
"I'm pleased to say that the new system has made tax-free
shopping easy and simple for retailers and the customs department
and, therefore, more available and accessible for tourists."
Senior vice president, New Markets and Public Affairs at Global
Blue, Jorge Casal, said the electronic system had performed
extremely well since its launch and the company would be doubling
its current investment in marketing and promotion over the
coming year to further support the development of the scheme.
In addition to operating the tax-free shopping system, Global
Blue supports local Bahamian merchants with additional services,
including training and the promotion of The Bahamas as a tax-
free shopping destination across its media platform, SHOP.
The International Monetary Fund and Argentina
took a step Monday toward repairing a rift that saw
the country become the first member censured by
The IMF released several of its recent assessments
of the Argentine economy that were held back due
to the rift, and said Buenos Aires had informed it of
plans to allow a formal IMF review, known as an
Article IV consultation, later in 2016.
That could restore the country's standing at the
global crisis lender a decade after the last Article IV
review, usually an annual event for IMF country
It also comes three years after the fund officially
censured Argentina for not living up to its obligations
to the Fund, particularly in providing accurate data
on economic growth and inflation.
The shift came on the same day a tentative deal
was announced to settle the fight over billions of
dollars in bond payments between hedge fund creditors
The government of President Mauricio Macri,
which has moved quickly on economic reforms since
taking office in December, agreed to pay US$4.65
billion to the creditors who had sued the country in
New York after it defaulted on its debt in 2001.
The documents released by the IMF were informal
updates on the country's economy made in 2013-
2015 for the IMF board. Normally the IMF does not
release such reports but said it did so at the request
of Macri's government.
The IMF said it believes the government "is working
to resolve the consultation delay" and has confirmed
its plans for an Article IV review later this year.
Emerging markets, including
those in the Caribbean,
must find new models of
economic growth, and the
first step is to move away
from models based on high
government spending or driven by debt,
says Natalie Mansoor, head of asset man-
agement at RBC Investment Management
Speaking at the recent Annual Forecast
Dinner hosted by the Chartered Financial
Analyst (CFA) Society Barbados, Mansoor
noted that many Caribbean economies
have traditionally linked their growth cycles
to the external environment, together with
reliance on one or two products or serv-
"It is a simple model," she said. "In good
times spend. In bad times borrow and
continue to spend and wait for good times
to come back."
But Mansoor said the problem with this
approach was that without stronger growth
cycles the debt simply continued to grow.
As a result, she said she expected to see
downgrades, debt restructuring and
defaults. She added: "I expect devaluations.
They are inevitable, whether we choose
them or have them forced on us."
She told CFA members and guests that
slow growth in wages had become a drag
on consumption in developed markets,
and growth in the global economy would
have to come from emerging markets with
growing populations and rising incomes.
In the United States, for example, she said,
growth in wages was not keeping abreast
of job creation.
"In the US we have unemployment of
five per cent, but we still see low wage
growth. Normally, we should be getting
more wage growth," Mansoor said.
The investment banker said two major
factors were now keeping the lid on wage
growth in developed markets. First, most
of the jobs being created are low-skilled
and low-paying. Secondly, the declining
cost of automation is displacing middle
In their presentations, both David Noel,
Scotiabank's managing director, Caribbean
East, and Donna Wellington, CIBC First-
Caribbean's managing director, Barbados
Operating Company, also warned that high
indebtedness and large fiscal deficits con-
tinued to undermine hope of meaningful
Made up of approximately 50 local
investment professionals, the CFA Society
Barbados is a member of the Chartered
Financial Analyst Institute, a global not
for profit organisation comprising over
135,000 investment professionals world-
Tax-free shopping for tourists in The Bahamas
Region urged to move away
from high govt spending
IMF, Argentina move
toward repairing rift
Macri urges opposition
to approve debt deal
Argentina's new pro-business President Mauricio
Macri urged Congress on Tuesday to approve a deal
ending a 15-year default nightmare and lambasted
what he called the shambles left by his leftist pred-
In a battling speech to a legislature dominated by
opponents, Macri said it was now up to them to
repair the damage he said was done by the refusal
to negotiate with international creditors before.
"I trust responsibility will prevail," he said.
A deal was announced Monday to settle the con-
flict, which dates back to 2001, when Argentina
defaulted on almost US$100 billion in debt. Nearly
all the country's creditors at the time accepted to
write off 70 per cent of their bonds, but a handful
of holdouts demanded full payment in a row that
crippled Argentina's access to financial markets.
Finance Minister Alfonso Prat-Gay said that
Buenos Aires would pay an estimated US$6.5 billion
in total to holdout creditors, including four hedge
funds named in the US$4.65-billion settlement
"Not resolving this conflict cost Argentinians
dearly," Macri told Congress, urging lawmakers to
"achieve the necessary consensus."
For Macri, the deal is part of a bid to reverse his
predecessor Cristina Kirchner's legacy in Latin Amer-
ica's third biggest economy.
"The first thing to recognise is that we are not
doing well, even if that hurts," he told Congress.
He said he had inherited "a state plagued by crony-
ism, waste, and corruption."
Describing a bloated public sector, which he said
was used to mask true unemployment, and inflation
forecast to hit around 20 per cent this year, Macri
said Kirchner left Argentina "in a mess and badly
A US-educated businessman, Macri, 57, took the
helm of Latin America's third-biggest economy in
December, following an election in which he won
51 per cent of the vote. AP
Argentina's President Mauricio Macri arrives to open the 2016 session of Congress and give an annual State of the Nation address in
Buenos Aires, Argentina, Tuesday, March 1, 2016. A day after Argentina and a group of US creditors announced a deal in a longstanding
debt standoff, has given President Macri a boost. Macri who assumed power in December after campaigning on promises to modernise
South America's second-largest economy by solving the dispute and attracting foreign investment. (AP)
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