/raid1/www/Hosts/bankrupt/TCRLA_Public/240625.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
L A T I N A M E R I C A
Tuesday, June 25, 2024, Vol. 25, No. 127
Headlines
A R G E N T I N A
ARGENTINA: Caputo's Number Two at Economy Ministry Quits
ARGENTINA: Monthly Inflation Slows to Lowest Level Since 2022
ARGENTINA: Oil Union's 48-Hour Strike Will Affect Vaca Muerta
B R A Z I L
BANCO ABC: Fitch Affirms 'BB' LongTerm IDRs, Outlook Stable
BRAZIL: Wind Power Sector Seeks Government Lifeline
XP INC: Fitch Assigns 'BB(EXP)' Rating on Senior Unsecured Notes
XP INC: Moody's Assigns 'Ba2' Rating to New Senior Unsecured Notes
D O M I N I C A N R E P U B L I C
DOMINICAN REPUBLIC: Rice Price Increases Feared due to Tax Reform
[*] DOMINICAN REPUBLIC: State Assets Amount to RD$12.4 Billion
P U E R T O R I C O
VIGILANCIA VIRTUAL: Taps Alcides Reyes-Gilestra as Special Counsel
T R I N I D A D A N D T O B A G O
TRINIDAD & TOBAGO: IEA Warns of Oil Price Decline
- - - - -
=================
A R G E N T I N A
=================
ARGENTINA: Caputo's Number Two at Economy Ministry Quits
--------------------------------------------------------
Buenos Aires Times reports that President Javier Milei's
administration has suffered another resignation following the news
that Luis 'Toto' Caputo's number two at the Economy Ministry has
quit the government.
At the end of the month, Economic Policy secretary Joaquín Cottani
will become the 47th official of the Milei government to leave his
post since the President took office last December, according to
Buenos Aires Times.
The Economy Ministry said Cottani's departure was for family
reasons, the report relays. "His family is back in New York, and
he struggles going back and forth all the time," sources at the
portfolio disclosed, adding that he would remain in post until the
end of June, the report notes.
The likely candidate to replace the official is Argentine-born
Chilean José Luis Daza, an economist who previously worked with
Caputo at major financial institutions JP Morgan and Deutsche Bank,
the report discloses.
Daza also lives abroad, so his appointment may take some weeks to
be confirmed, said the Economy Ministry sources, the report says.
The likely replacement founded QFR Capital Management, one of the
most important hedge funds in emerging markets, together with
Argentines David Sekiguchi and Demian Reidel, figures who are both
members of President Milei's advisory council, the report
discloses.
Daza previously represented the Chilean Central Bank in Asia, based
in Tokyo, the report relays. He was also head of emerging markets
at JP Morgan, where he met Caputo, and the duo also worked together
at Deutsche Bank, the report notes.
The Chilean economist has a doctorate in economics from the
University of Georgetown and an economics degree from the
Universidad de Chile, the report says.
During Chile's last presidential campaign, he supported far-right
politician José Antonio Kast, an apologist for deceased military
dictator Augusto Pinochet, the report relays.
Daza would have been economy minister in a government led by Kast,
who eventually lost the election to Chilean left-winger Gabril
Boric, the report adds.
Cottani's Departure
The report discloses that Cottani's departure will add to an
ever-growing list of officials who have quit or been ousted from
the Milei government. He is the ninth to have left the Economy
Ministry since Caputo took over.
Minister Caputo had praised Cottani as "one of the silent creators
of the best moments of the 1990s" when the economist agreed to join
the government last November, the report relays.
In 1991, Cottani held the post of finance undersecretary during
Domingo Cavallo's time as economy minister during former president
Carlos Menem's government, the report recalls.
An economist who graduated from the Universidad Nacional de
Córdoba, Cottani studied at Yale University, where he obtained a
master's degree, a doctorate, and a postdoctoral degree, the report
relays.
He worked at Lehman Brothers, Citi Bank, the World Bank and was
head of Latin America for S&P Global Ratings, the report says. He
also taught economics at Boston University, the report notes.
Until 2023, he worked as business advisor for the financial sector
via LatinSource, a network of independent consultants based in New
York, and is a managing partner of DFC Associates, LLC, a
consultancy and investment advice company, the report adds.
About Argentina
Argentina is a country located mostly in the southern half of South
America. Its capital is Buenos Aires. Javier Milei is the current
president of Argentina after winning the November 19, 2023 general
election. He succeeded Alberto Angel Fernandez in the position.
Argentina has the third largest economy in Latin America. The
country's economy is an upper middle-income economy for fiscal year
2019, according to the World Bank. Historically, however, its
economic performance has been very uneven, with high economic
growth alternating with severe recessions, income maldistribution
and in the recent decades, increasing poverty.
The IMF's executive board completed on August 23, 2023, the fifth
and six reviews of Argentina's 30-month Extended Fund Facility
(EFF), and approved a US$7.5-billion disbursement to Argentina as
part of the larger program, which refinances payments Argentina
owes the institution from a previous bailout that failed to
stabilize the economy in 2018. Argentina would receive another IMF
disbursement in November of about US$2.75 billion pending another
staff-level agreement and board approval.
S&P Global Ratings, on March 15, 2024, raised its local currency
sovereign credit ratings on Argentina to 'CCC/C' from 'SD/SD' and
its national scale rating to 'raB+' from 'SD'. S&P also raised its
long-term foreign currency sovereign credit rating to 'CCC' from
'CCC-' and affirmed its 'C' short-term foreign currency rating. The
outlook on the long-term ratings is stable. In addition, S&P
revised its transfer and convertibility assessment to 'CCC' from
'CCC-'.
S&P said the stable outlook on the long-term ratings balances the
risks posed by pronounced economic imbalances and policy
uncertainties with the favorable change in near-term debt service
obligations. S&P also expect no further debt exchanges that it
would likely consider to be distressed.
Fitch Ratings upgraded on June 13, 2023, Argentina's Long-Term
Foreign Currency (FC) Issuer Default Rating (IDR) to 'CC' from
'C'and affirmed the Long-Term Local Currency (LC) IDR at 'CCC-'.
Fitch typically does not assign Outlooks to sovereigns with a
rating of 'CCC+' or below.
The upgrade of the FC IDR reflects that Fitch no longer deems a
default-like process to have begun, as the authorities have not
signaled a clear intention to follow through with an intra-public
debt swap announced in March. The new 'CC' rating signals a default
event of some sort appears probable in the coming years, regardless
of the outcome of upcoming elections. The affirmation of the LC IDR
at 'CCC-' follows the peso debt swap in June that Fitch did not
deem to be a "distressed debt exchange" (DDE).
Moody's Investors Service, in September 2022, affirmed Argentina's
Ca foreign-currency and local-currency long-term issuer and senior
unsecured ratings. The outlook remains stable. The decision to
affirm the Ca ratings balances Argentina's limited market access,
weak governance, and history of recurrent debt restructurings with
recent efforts to marshal fiscal and monetary measures to start
addressing underlying macroeconomic imbalances in the context of
the IMF program that was approved in 2022, according to Moody's.
DBRS, Inc. confirmed Argentina's Long-Term Foreign Currency Issuer
Rating at CCC and downgraded its Long-Term Local Currency Issuer
Rating to CCC from CCC (high) on March 3, 2023.
ARGENTINA: Monthly Inflation Slows to Lowest Level Since 2022
-------------------------------------------------------------
globalinsolvency.com, citing Bloomberg News, reports that monthly
inflation in Argentina slowed to its lowest level in May since
early 2022, capping the fifth straight cooler print under President
Javier Milei as market doubts linger that the trend can be
sustained.
Consumer prices rose 4.2% last month, less than economists
estimates for 5% and the lowest level since January 2022, according
to globalinsolvency.com. From a year ago, inflation slowed to
276.4%, according to government data published, the report notes.
Communication costs and education led monthly price gains in May by
categories, the report relays.
While far from a definitive victory, a slower pace of price
increases marks another positive development for Milei after the
majority of his economic reforms passed through the Senate in a
pivotal vote, the report discloses.
His government also renewed a portion of its currency swap line
with China, while the International Monetary Fund's executive board
is expected to approve the latest review of the country's program
sometime, the report notes. Milei will participates in the Group
of Seven summit in Italy, too, the report relays.
While the Milei's administration is expected to trumpet the
positive results of its economic shock therapy program, private
economists see the current pace of monthly inflation as somewhat of
a floor in the short term, the report discloses. Although
inflation expectations have declined significantly this year,
analysts surveyed by Argentina's central bank in May don't expect
monthly price rises below 5% through September, the report says.
Even by November, monthly inflation is seen at 4.5%, the report
adds.
About Argentina
Argentina is a country located mostly in the southern half of South
America. Its capital is Buenos Aires. Javier Milei is the current
president of Argentina after winning the November 19, 2023 general
election. He succeeded Alberto Angel Fernandez in the position.
Argentina has the third largest economy in Latin America. The
country's economy is an upper middle-income economy for fiscal year
2019, according to the World Bank. Historically, however, its
economic performance has been very uneven, with high economic
growth alternating with severe recessions, income maldistribution
and in the recent decades, increasing poverty.
The IMF's executive board completed on August 23, 2023, the fifth
and six reviews of Argentina's 30-month Extended Fund Facility
(EFF), and approved a US$7.5-billion disbursement to Argentina as
part of the larger program, which refinances payments Argentina
owes the institution from a previous bailout that failed to
stabilize the economy in 2018. Argentina would receive another IMF
disbursement in November of about US$2.75 billion pending another
staff-level agreement and board approval.
S&P Global Ratings, on March 15, 2024, raised its local currency
sovereign credit ratings on Argentina to 'CCC/C' from 'SD/SD' and
its national scale rating to 'raB+' from 'SD'. S&P also raised its
long-term foreign currency sovereign credit rating to 'CCC' from
'CCC-' and affirmed its 'C' short-term foreign currency rating. The
outlook on the long-term ratings is stable. In addition, S&P
revised its transfer and convertibility assessment to 'CCC' from
'CCC-'.
S&P said the stable outlook on the long-term ratings balances the
risks posed by pronounced economic imbalances and policy
uncertainties with the favorable change in near-term debt service
obligations. S&P also expect no further debt exchanges that it
would likely consider to be distressed.
Fitch Ratings upgraded on June 13, 2023, Argentina's Long-Term
Foreign Currency (FC) Issuer Default Rating (IDR) to 'CC' from
'C'and affirmed the Long-Term Local Currency (LC) IDR at 'CCC-'.
Fitch typically does not assign Outlooks to sovereigns with a
rating of 'CCC+' or below.
The upgrade of the FC IDR reflects that Fitch no longer deems a
default-like process to have begun, as the authorities have not
signaled a clear intention to follow through with an intra-public
debt swap announced in March. The new 'CC' rating signals a default
event of some sort appears probable in the coming years, regardless
of the outcome of upcoming elections. The affirmation of the LC IDR
at 'CCC-' follows the peso debt swap in June that Fitch did not
deem to be a "distressed debt exchange" (DDE).
Moody's Investors Service, in September 2022, affirmed Argentina's
Ca foreign-currency and local-currency long-term issuer and senior
unsecured ratings. The outlook remains stable. The decision to
affirm the Ca ratings balances Argentina's limited market access,
weak governance, and history of recurrent debt restructurings with
recent efforts to marshal fiscal and monetary measures to start
addressing underlying macroeconomic imbalances in the context of
the IMF program that was approved in 2022, according to Moody's.
DBRS, Inc. confirmed Argentina's Long-Term Foreign Currency Issuer
Rating at CCC and downgraded its Long-Term Local Currency Issuer
Rating to CCC from CCC (high) on March 3, 2023.
ARGENTINA: Oil Union's 48-Hour Strike Will Affect Vaca Muerta
-------------------------------------------------------------
Buenos Aires Times, citing Reuters, reports that Argentina's
largest oil union said it will strike for 48 hours to demand higher
salaries, a move that will affect production at the giant Vaca
Muerta shale formation.
The Vaca Muerta hydrocarbon formation is the world's second-largest
shale gas reserve and the fourth largest for shale oil, and plays a
central role in Argentina's plan to reverse a significant deficit
in its energy trade balance and become a net energy exporter,
according to Buenos Aires Times.
The Union of Private Oil and Gas Workers in Rio Negro, Neuquen and
La Pampa - the provinces where Vaca Muerta is located - said it
called the strike after talks with companies failed, the report
notes.
The protest will take place soon after, according to a press
release, the report relays. "We tried to sit down, understand,
talk, reach an agreement, but they brought us the same proposals as
a year and a half ago, the same thing we talked about four months
ago," said the union's general secretary, Marcelo Rucci, the report
adds.
About Argentina
Argentina is a country located mostly in the southern half of South
America. Its capital is Buenos Aires. Javier Milei is the current
president of Argentina after winning the November 19, 2023 general
election. He succeeded Alberto Angel Fernandez in the position.
Argentina has the third largest economy in Latin America. The
country's economy is an upper middle-income economy for fiscal year
2019, according to the World Bank. Historically, however, its
economic performance has been very uneven, with high economic
growth alternating with severe recessions, income maldistribution
and in the recent decades, increasing poverty.
The IMF's executive board completed on August 23, 2023, the fifth
and six reviews of Argentina's 30-month Extended Fund Facility
(EFF), and approved a US$7.5-billion disbursement to Argentina as
part of the larger program, which refinances payments Argentina
owes the institution from a previous bailout that failed to
stabilize the economy in 2018. Argentina would receive another IMF
disbursement in November of about US$2.75 billion pending another
staff-level agreement and board approval.
S&P Global Ratings, on March 15, 2024, raised its local currency
sovereign credit ratings on Argentina to 'CCC/C' from 'SD/SD' and
its national scale rating to 'raB+' from 'SD'. S&P also raised its
long-term foreign currency sovereign credit rating to 'CCC' from
'CCC-' and affirmed its 'C' short-term foreign currency rating. The
outlook on the long-term ratings is stable. In addition, S&P
revised its transfer and convertibility assessment to 'CCC' from
'CCC-'.
S&P said the stable outlook on the long-term ratings balances the
risks posed by pronounced economic imbalances and policy
uncertainties with the favorable change in near-term debt service
obligations. S&P also expect no further debt exchanges that it
would likely consider to be distressed.
Fitch Ratings upgraded on June 13, 2023, Argentina's Long-Term
Foreign Currency (FC) Issuer Default Rating (IDR) to 'CC' from
'C'and affirmed the Long-Term Local Currency (LC) IDR at 'CCC-'.
Fitch typically does not assign Outlooks to sovereigns with a
rating of 'CCC+' or below.
The upgrade of the FC IDR reflects that Fitch no longer deems a
default-like process to have begun, as the authorities have not
signaled a clear intention to follow through with an intra-public
debt swap announced in March. The new 'CC' rating signals a default
event of some sort appears probable in the coming years, regardless
of the outcome of upcoming elections. The affirmation of the LC IDR
at 'CCC-' follows the peso debt swap in June that Fitch did not
deem to be a "distressed debt exchange" (DDE).
Moody's Investors Service, in September 2022, affirmed Argentina's
Ca foreign-currency and local-currency long-term issuer and senior
unsecured ratings. The outlook remains stable. The decision to
affirm the Ca ratings balances Argentina's limited market access,
weak governance, and history of recurrent debt restructurings with
recent efforts to marshal fiscal and monetary measures to start
addressing underlying macroeconomic imbalances in the context of
the IMF program that was approved in 2022, according to Moody's.
DBRS, Inc. confirmed Argentina's Long-Term Foreign Currency Issuer
Rating at CCC and downgraded its Long-Term Local Currency Issuer
Rating to CCC from CCC (high) on March 3, 2023.
===========
B R A Z I L
===========
BANCO ABC: Fitch Affirms 'BB' LongTerm IDRs, Outlook Stable
-----------------------------------------------------------
Fitch Ratings has affirmed Banco ABC Brasil S.A.'s (ABCBr)
Long-Term (LT) Foreign Currency (FC) Issuer Default Rating (IDR) at
'BB', LT Local Currency (LC) IDR at 'BB' and LT National Rating at
'AAA(bra)'. The Rating Outlook is Stable. In addition, Fitch has
affirmed the Shareholder Support Rating (SSR) at 'bb' and upgraded
ABCBr's Viability Rating (VR) to 'bb' from 'bb-'.
The VR upgrade reflects an improvement in the bank's business
profile with resilient results in the past few quarters, while it
has been increasing the diversification of clients, geographies and
sectors covered as well as product offering. ABCBr has demonstrated
disciplined growth in its credit portfolio. It has also maintained
a conservative risk appetite toward domestic corporates and the
middle market segment, which is an important margin booster for the
bank. Capitalization is adequate for its risk profile, and the bank
has enhanced capital lately through the issuance of Tier 1 hybrid
instruments.
KEY RATING DRIVERS
IDRs, SSR and National Ratings
Stronger Intrinsic Credit Profile: The VR and the SSR are now
aligned, but the final ratings remain unchanged as the Shareholder
Support Ratings (SSR) were already at 'bb', reflecting the parent's
support.
Shareholder Support Upholds IDRs: While ABCBr's IDRs are driven by
its intrinsic strength, the ratings are sustained by potential
shareholder support, which is reflected in the Shareholder Support
Rating (SSR) of 'bb'. Fitch believes Arab Banking Corporation (ABC;
Long-Term [LT] Foreign Currency [FC] IDR BB+/Stable and Viability
Rating bb+) has moderate propensity to support ABCBr if needed due
to the subsidiary's contribution to revenue diversification for the
parent.
ABCBr provides more than half of the group's revenues; as such
Fitch views ABCBr's activities in Brazil as strategically important
for the parent. ABC owns nearly 64% of ABCBr, and they share a
similar brand. Therefore the propensity to support is enhanced by
reputational risk as, in an unlikely event of a default at the
subsidiary level, there could be high reputational risk for the
parent.
VR
Cooler but Steady Growth: Fitch expects Brazil's economic growth to
moderate to 1.5% in 2024 from 3.0% in 2023 but for banking sector
performance to remain broadly stable over the year. Impaired loan
formation will be less intense after high inflows in a challenging
2023, while business volumes could gradually recover over the
medium term amid less restrictive domestic monetary policy and a
resilient labor market. This supports its stable outlook on
Brazil's operating environment score of 'bb', which is in line with
the implied score for the 'bb' category.
Resilient and Growing Business Profile: Fitch upgraded ABCBr's
business profile score to 'bb' from 'bb-'. The bank's medium-term
expansion strategy includes continuous growth in its most
representative businesses (corporates and CI&B) while posting
conservative growth in the middle market segment. The entrance and
expansion in the middle market has not only increased
diversification in terms of clients, but also in terms of
geographies and product offerings, while also mitigating
volatilities in its other business lines.
Although ABCBr has been posting a well-executed growth strategy,
its asset market share is less than one percent on a national
basis, and it is still much lower in scale, revenue base, and
domestic capillarity comparing to larger commercial banks.
Conservative Risk Profile: Fitch upgraded ABCBr's risk profile to
'bb' from 'bb-'. The bank's increasing number of clients and
geographic expansion diversifies risks according to Fitch. ABCBr's
credit is exposed mainly to large Brazilian corporates with good
credit quality in the domestic market. The bank's credit standards,
in general, are conservative, as evidenced by collateralized credit
concessions in the middle market attached to real guarantees. The
bank has become more restrictive in its credit controls in recent
quarters. Moreover, ABCBr has relevant exposure in sovereign debt
that are highly liquid and composes its cash position.
Adequate Asset Quality: ABCBr has maintained adequate asset quality
metrics over many years, but its Non-Performing Loans (NPLs) was
pressured since last year due to its expansion in the middle market
and an isolated default in the corporates segment. As of March 31,
2024, the bank's loans past-due over 90 days/gross loans ratio
increased to 2.9% from 2.6% in December 2023 and 0.64% in March
2023.
The core impaired loan metric (loans classified D—H) was 6.4% on
March 2024 and 6% at YE 2023, with a four-year average of 4.9%.
Given the conservative growth Fitch expects for ABCBr's credit
portfolio for YE 2024, a deterioration in asset quality ratios for
the next years is not expected, even with greater participation in
the middle market segment.
Positive Profitability Trend: Fitch upgraded earnings and
profitability to 'bb-' from 'b+'. The bank's profitability measured
by operating profit/risk-weighted assets (RWAs) have consistently
improved in the last few quarters, signaling margin gains from
growth in the middle market segment but also increases in fee
income.
ABCBr's profitability suffered slightly during 2023 because of some
decline in Brazil's base interest rate (Selic) and increasing
provisioning expenses. As of March 2024, however, metrics are
likely to continue to improve, as already observed during the first
quarter of 2024, with operating profit/risk-weight assets (RWAs)
improving 20 basis points comparing to YE 2023. The bank's
profitability still benefits from improved margins, increases in
fee income, and much lower credit costs in the last few years,
bringing the four-year average operating profit/RWAs to 1.9% by
YE23.
Adequate Capitalization: Fitch upgraded capitalization and leverage
to 'bb' from 'bb-'. The bank's capital ratios have remained fairly
stable over the past few years due in part to modest profit
generation and conservative credit portfolio growth, a trend Fitch
expects to continue over the medium term.
As of March 31, 2024, the bank's CET1 ratio declined slightly to
11.7% from 11.9% at YE 2022, due mostly to loan growth. However,
the bank's total regulatory capital ratio increased to 16.6% given
the bank's capital enhancement through the issuance of Tier 1
hybrid instruments. The bank's ratios well exceed the Central Bank
regulatory minimum total capital requirement and is in line with
Basel III rules.
Stable Funding and Ample Liquidity: The bank continues to rely on
long-term funding sources such as issuances of notes in the local
market such as Letras Financeiras (LFs), which are likewise
deposits. As of March 31, 2024, local funding accounted 85% of the
bank's funding and within that percentage, institutional accounted
for nearly 36.5%, individual deposits accounted for 16.4% and
corporate deposits accounted for nearly 16.3%. International
funding accounted for nearly 15% with the majority of that related
to trade finance and the remainder from multi-lateral agencies.
The bank's liquidity buffers are adequate given limited forthcoming
maturities. Fitch does not expect any change to the bank's funding
and liquidity strategy over the medium term.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
SSR
- Negative change in Fitch's assessment of ABC's willingness or
ability (due to the material size of the subsidiary) to support
ABCBr; or/and
- Negative rating action on the parent bank, ABC, though a
downgrade of the IDRs would be limited by the level of the bank's
VR.
VR
- Fitch observes a significant deterioration of ABCBr's asset
quality that results in credit costs that severely limit its
profitability (operating profit to risk-weighted assets [RWA] ratio
consistently below 1.0%) and the ability to grow its capital; and
- A sustained decline in ABCBr's common equity Tier 1 (CET1) ratio
below 11%.
National Ratings
- Unfavorable changes in ABCBr's credit profile relative to its
Brazilian peers could result in a reduction in its National
Ratings.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
IDRs and SSR
IDRs could be positively affected in the event of a positive rating
action on its parent, that would result in a similar action on the
bank's FC LT IDR and SSR. However, in the event of an upgrade of
the parent by more than one notch, the bank's ratings would be
constrained by the country ceiling.
VR
- A positive rating action on ABCBr's VR is limited at this point,
considering its operating environment and scale and
representativeness in the Brazilian banking sector.
National Ratings
- The National Ratings are at the top of the National Rating Scale
and thus further upgrades are not possible.
VR ADJUSTMENTS
The VR has been assigned in line with the implied VR.
The Earnings & Profitability score of 'bb-' has been assigned above
the implied 'b' Earnings & Profitability Score due to the following
adjustment reason: Historical and future metrics (positive).
The Funding & Liquidity score of 'bb-' has been assigned above the
implied 'b' Funding & Liquidity Score due to the following
adjustment reason: Non-deposit funding (positive).
PUBLIC RATINGS WITH CREDIT LINKAGE TO OTHER RATINGS
ABCBr's SSR are driven by support from the Arab Banking Corporation
(ABC; LT FC IDR BB+/Stable and VR bb+).
ESG CONSIDERATIONS
The highest level of ESG credit relevance is a score of '3', unless
otherwise disclosed in this section. A score of '3' means ESG
issues are credit-neutral or have only a minimal credit impact on
the entity, either due to their nature or the way in which they are
being managed by the entity. Fitch's ESG Relevance Scores are not
inputs in the rating process; they are an observation on the
relevance and materiality of ESG factors in the rating decision.
Entity/Debt Rating Prior
----------- ------ -----
Banco ABC
Brasil S.A. LT IDR BB Affirmed BB
ST IDR B Affirmed B
LC LT IDR BB Affirmed BB
LC ST IDR B Affirmed B
Natl LT AAA(bra)Affirmed AAA(bra)
Natl ST F1+(bra)Affirmed F1+(bra)
Viability bb Upgrade bb-
Shareholder Support bb Affirmed bb
BRAZIL: Wind Power Sector Seeks Government Lifeline
---------------------------------------------------
Lachlan Williams at Rio Times Online reports that Brazil's wind
energy sector is currently in turmoil, prompting the government to
consider urgent, necessary interventions.
This industry, crucial for sustainable energy, has seen a drastic
reduction in new projects over the last two years, according to Rio
Times Online.
Consequently, orders for critical components like turbines and
blades have plummeted, the report notes.
Currently, the sector grapples with two main issues, the report
relays. An excess of energy in the regulated market has negated
the need for new capacity auctions, the report discloses.
Moreover, this surplus depresses energy prices in the free market,
complicating profitability for new ventures, the report says.
Additionally, a global drop in solar panel prices has undercut wind
energy's competitiveness, the report relays.
This price fall favors photovoltaic installations over wind
projects and promotes the adoption of new distributed generation
systems, slicing into the distributors' market share, the report
notes.
The competitive edge of wind energy is further eroded by the influx
of cheap solar panels from China, the report relays.
In response, the government is contemplating export incentives for
domestic equipment manufacturers, the report discloses.
Such measures would aid Brazilian companies in tapping into markets
focused on the energy transition, like the U.S. and Europe, the
report notes.
Rio Times Online relays that this strategy could ease immediate
industrial pressures, averting job losses and production halts.
Despite these efforts, major industry players like GE and Siemens
Gamesa have already ceased their Brazilian operations, the report
says.
Similarly, WEG plans to pause its turbine production in Santa
Catarina by mid-year to pivot towards the U.S. market, the report
notes.
Meanwhile, Aeris, a blade manufacturer, has laid off 1,500 workers
due to a lack of domestic orders, the report relays.
Vestas, another key player, although not currently in crisis,
predicts potential production stops in the next two years, the
report notes.
These developments led to discussions with Finance Minister
Fernando Haddad, focusing on restoring sectoral competitiveness,
the report discloses.
Other governmental strategies include tweaking financing lines and
modifying import tariffs, the report notes.
A notable proposal is mandating local content in solar projects
financed by state banks to level the playing field with imported
solar technologies, the report relays.
This suite of measures aims to safeguard a sector that not only
employs thousands but also contributes significantly to Brazil's
renewable energy output, the report notes.
The Brazilian Association of Wind Energy supports these
initiatives, noting an 80% domestic component in wind turbines,
contrasted with an 80% import rate for solar parts, the report
says.
Global trends towards protectionism, like the U.S.'s recent tariff
hikes on Chinese tech goods, mirror Brazil's potential path, the
report notes.
This protective stance is crucial as Brazil strives to maintain its
renewable energy advancements and industrial capacity in the face
of global economic shifts and competitive pressures, the report
adds.
About Brazil
Brazil is the fifth largest country in the world and third largest
in the Americas. Luiz Inacio Lula da Silva won the 2022 Brazilian
general election. He was sworn in on January 1, 2023, as the 39th
president of Brazil, succeeding Jair Bolsonaro.
S&P Global Ratings raised on Dec. 19, 2023, its long-term global
scale ratings on Brazil to 'BB' from 'BB-'. The outlook on the
long-term ratings is stable. S&P affirmed Brazil's global scale
short-term ratings at 'B' and its national scale long-term rating
at 'brAAA'. S&P also raised the transfer and convertibility
assessment on the country to 'BBB-' from 'BB+'. S&P said, "The
stable outlook reflects our expectation that Brazil will maintain
A strong external position, thanks to strong commodity output and
limited external financing needs. We also believe Brazil's
institutional framework can sustain stable and pragmatic
policymaking based on extensive checks and balances across the
executive, legislative, and judicial branches of government. We
expect a very gradual fiscal correction but anticipate fiscal
deficits will remain large."
Fitch Ratings affirmed on Dec. 15, 2023, Brazil's Long-Term
Foreign-Currency Issuer Default Rating (IDR) at 'BB' with a Stable
Outlook. Fitch said Brazil's ratings are supported by its large and
diverse economy, high per-capita income, and deep domestic markets
and a large cash cushion that support the sovereign's financing
flexibility and its high local-currency debt share. Strong external
finances support resilience to shocks, underpinned by a flexible
exchange rate, robust international reserves and a sovereign net
external creditor position. The ratings are constrained by weak
economic growth potential, relatively low governance scores, high
and rising government debt/GDP, and budgetary rigidities. A new
fiscal framework introduced this year aims to anchor a gradual
consolidation process and address these fiscal weaknesses, but its
effectiveness is increasingly unclear.
Moody's credit rating for Brazil was last set at Ba2 in 2018 with
stable outlook. Moody's affirmed the Ba2 issuer ratings and
senior unsecured bond ratings in April 2022.
DBRS Inc., on August 15, 2023, upgraded Brazil's Long-Term
Foreign and Local Currency - Issuer Ratings to BB from BB (low).
At the same time, DBRS Morningstar confirmed Brazil's
Short-term Foreign and Local Currency - Issuer Ratings at R-4.
The trend on all ratings is Stable (March 2018).
XP INC: Fitch Assigns 'BB(EXP)' Rating on Senior Unsecured Notes
----------------------------------------------------------------
Fitch Ratings has assigned a 'BB(EXP)' rating to XP Inc.'s proposed
senior unsecured notes. The issuance amount is expected to be
similar with the previous bond issued in 2021, with a five-year
tenor, semiannual coupon payments and an annual interest rate not
yet defined. The net proceeds will be used to finance and/or
refinance, in whole or in part, existing issuances and also to
support the entity general corporate purposes.
The final rating is contingent upon the receipt of final documents
confirming to the information already reviewed.
KEY RATING DRIVERS
The expected rating corresponds to XP Inc.'s Long-Term Foreign
Currency Issuer Default Rating (IDR; BB/Stable) and ranks equal to
its other senior unsecured debt. XP Inc.'s IDRs are at the same
level as its assigned Sector Risk Operating Environment score of
'bb' and as the Brazilian sovereign rating (BB/Stable).
XP Inc.'s ratings are based on its standalone credit profile, which
reflects its strong and solid business model and leading retail
brokerage franchise in Brazil. It has evolved into a full financial
solution supported by a robust technological platform and strong
brand that are key competitive advantages over domestic peers.
XP Inc.'s ratings also consider its strong management, corporate
governance and risk management framework, a strong asset quality,
resilient profitability, robust funding structure and increasing
but still adequate leverage ratios.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- Debt rating downgrades would be dependent on downgrades of XP
Inc.'s IDRs.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- Debt rating upgrades would be dependent on upgrades of XP Inc.'s
IDRs.
Entity/Debt Rating
----------- ------
XP Inc.
senior unsecured LT BB(EXP) Expected Rating
XP INC: Moody's Assigns 'Ba2' Rating to New Senior Unsecured Notes
------------------------------------------------------------------
Moody's Ratings has assigned a Ba2 long-term foreign-currency
backed senior unsecured debt rating to the proposed backed senior
unsecured notes to be issued by XP Inc (XP). The proposed notes,
which are fully and unconditionally guaranteed by its subsidiary XP
Investimentos S.A., will be denominated and settled in USD, and due
in July 2029.
RATINGS RATIONALE
The Ba2 rating on the notes to be issued by XP derives from the
firm's existing long-term Corporate Family Rating (CFR) of Ba2.
XP's CFR of Ba2 reflects the firm's leading position as a
full-service securities company offering a broad array of
market-making and brokerage services to retail, corporate and
institutional clients in Brazil's capital markets. In addition, the
Ba2 CFR also incorporates XP's consistent track record of recurring
earnings generation, which reflects a business structure consisting
of diversified sources of revenue and well-established footprint in
the financial investment service segment, credit strengths that
have helped XP to transition through economic cycles.
Under the proposed terms and conditions of XP's debt offering, the
principal and payment of interest on the proposed notes will be
irrevocably and unconditionally guaranteed by XP Investimentos
S.A., the intermediate holding company that houses the vast
majority of XP's operations. Moody's considers that XP's creditors
are structurally subordinated to its main market-making,
broker-dealer operating company's (XP CCTVM S.A.) sizeable
debt-like obligations, predominantly short-term repos of the
Government of Brazil's sovereign bonds. However, the cash flows
generated by XP's diverse other activities are of sufficient size
to offset this structural subordination in its capital structure,
and accordingly the ratings assigned to XP's proposed debt
instruments are aligned with its CFR.
The outlook on XP's backed senior unsecured debt rating is positive
and consistent with the positive outlook at the Brazilian sovereign
rating of Ba2, reflecting the company's strong link to sovereign
risk.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING
A positive move in Brazil's sovereign rating could result in an
upward movement in XP's ratings, reflecting the company's strong
link to sovereign risk through its market-making activities in
Brazilian sovereign debt, holdings of government securities and
geographical concentration of operations in Brazil.
A downgrade in Brazil's credit ratings could lead to a downgrade in
XP's ratings. In addition, XP's CFR could be downgraded if the
company shows material increase in risk appetite that could weaken
its liquidity profile or rise its balance sheet leverage. A
substantial failure in risk management and controls, or a sustained
fall in profitability from increased competition or changes in the
regulatory environment could also result in downward rating
pressure.
The principal methodology used in this rating was Securities
Industry Market Makers Methodology published in November 2019.
===================================
D O M I N I C A N R E P U B L I C
===================================
DOMINICAN REPUBLIC: Rice Price Increases Feared due to Tax Reform
-----------------------------------------------------------------
Dominican Today reports that traders of the Cristo Rey and Duarte
markets, in view of the increase every two weeks of the price of a
sack of rice, were in favor of the importation of this cereal to
reduce prices and fear further increases of the products they sell
in view of the imminent fiscal reform to be carried out by the
government.
The food vendors in these markets said that the authorities should
meet with the country's rice producers to agree on a plan that
would allow the importation of rice, freeing competition, so that
vendors and customers have more options in this market, according
to Dominican Today.
"The government must get its act together, import American rice so
that the rice here will go down," said Fabio Mota, owner of Casa
Katering, the report notes.
Mota insisted on the need for President Luis Abinader to reach an
agreement with the national rice producers because the "basic
family basket is expensive," the report relays. At the same time,
he complained that every week a sack of rice rises 100 pesos, thus
increasing the selling price which causes a decrease in the
purchasing power of sellers and consumers, the report discloses.
"The essentials, oil and rice are expensive and that has not come a
tax reform and if the tax reform arrives there is that the gas is
going to run a lot ", complains consumer Carlos Mercedes in the
Duarte Market, the report says.
Mercedes declared that he used to buy a 100-pound sack of rice for
RD$3,000, while recently he bought it for RD$3,600, so it is going
for 36 pesos per pound of cereal and the trend is upwards, the
report notes.
Other products continue to increase, such as potatoes and onions at
70 pesos per pound, while salaries remain "the same", that is,
there is no adjustment for inflation periodically, according to
Mercedes, a regular visitor to the Duarte Market, the report
relays.
Price of Chicken Rose Four Pesos One Day After Elections
According to Benny Jimenez, a chicken vendor at the Cristo Rey
Market one day after the elections in which President Abinader won,
the price of chicken increased four pesos, the report relays.
"The price is not stable, when he (President Abinader) won the
elections the next day it went up four pesos and then to three,"
said Jimenez, the report discloses.
Another merchant, identified as Santa of the Cristo Rey Market,
said that products such as beef, pork, sausage, liver have
experienced an increase of between 20, 30, 10 and 5 pesos, the
report relays.
While the prices of vegetables and fruits have registered a
decrease in prices, said the merchant of the Duarte Market, Rene
Rodriguez, the report notes.
Rodriguez commented that products such as tomatoes and peppers have
dropped "a lot" because before they were sold between 60-65 pesos
per pound, now they are marketed between 30 and 35 pesos per pound,
the report adds.
About Dominican Republic
The Dominican Republic is a Caribbean nation that shares the island
of Hispaniola with Haiti to the west. Capital city Santo Domingo
has Spanish landmarks like the Gothic Catedral Primada de America
dating back 5 centuries in its Zona Colonial district. Luis Rodolfo
Abinader Corona is the current president of the nation.
TCR-LA reported in April 2019 that Juan Del Rosario of the UASD
Economic Faculty cited a current economic slowdown for the
Dominican Republic and cautioned that if the trend continues,
growth would reach only 4% by 2023. Mr. Del Rosario said that if
that happens, "we'll face difficulties in meeting international
commitments."
An ongoing concern in the Dominican Republic is the inability of
participants in the electricity sector to establish financial
viability for the system.
On December 4, 2023, the TCR-LA reported that Fitch Ratings has
affirmed Dominican Republic's Long-Term Foreign-Currency Issuer
Default Rating (IDR) at 'BB-' and revised the Outlook to Positive
from Stable. Fitch says the Positive Outlook reflects a trend
improvement in governance, and robust growth prospects that should
lead to continued gains in per capita income. According to Fitch,
growth has decelerated in 2023, but it expects Dominican Republic
to recover to high levels during 2024-2025. External liquidity
metrics have improved in recent years, and foreign currency share
of government debt is on a downward path.
In August 2023, Moody's Investors Service changed the outlook on
the Government of Dominican Republic's ratings to positive from
stable and affirmed the local and foreign-currency long-term issuer
and senior unsecured ratings at Ba3. Moody's said the key drivers
for the outlook change to positive are: (i) sustained high growth
rates have enhanced the scale and wealth levels of the economy; and
(ii) a material decline in the government debt burden coupled with
improved fiscal policy effectiveness will support medium-term debt
sustainability.
The affirmation of the Ba3 ratings balances the Dominican
Republic's strong economic growth dynamics and relatively contained
susceptibility to event risks, with a comparatively weaker fiscal
position, reflecting long-standing credit challenges which include:
(i) a shallow revenue base compared to peers, (ii) weak debt
affordability metrics, and (iii) high exposure to foreign currency
borrowing.
S&P Global Ratings, in December 2022, raised its long-term foreign
and local currency sovereign credit ratings on the Dominican
Republic to 'BB' from 'BB-'. The outlook on the long-term ratings
is stable. S&P affirmed its 'B' short-term sovereign credit
ratings. S&P also revised its transfer and convertibility (T&C)
assessment to 'BBB-' from 'BB+'. The stable outlook reflects S&P's
expectation of continued favorable GDP growth and policy continuity
over the next 12-18 months that will likely stabilize the
government's debt burden.
In February 2023, S&P said its BB ratings reflect the country's
fast-growing and resilient economy. It also incorporates the
country's historical political and social challenges in passing
structural reforms to contain fiscal deficits, despite recent
improvements in the electricity sector. The ratings are constrained
by relatively high debt, a hefty interest burden, and limited
monetary policy flexibility.
[*] DOMINICAN REPUBLIC: State Assets Amount to RD$12.4 Billion
--------------------------------------------------------------
Dominican Today reports that Minister of the Presidency Joel Santos
Echavarria announced the results of the first phase of the National
Census of State Real Estate, which registered a total of 46,737
properties valued at RD$12,415,672,527,850.20.
During a joint press conference with Rafael A. Burgos Gomez,
Director of National Assets and honorary member of the State Sugar
Council, Santos Echavarria recalled that President Luis Abinader
authorized the census through decree 414-22 on August 3, 2022,
according to Dominican Today. The census was completed in record
time.
Santos Echavarria emphasized that the results strengthen the
government's transparency plan by providing an inventory of state
property assets, the report notes. This initiative aims to protect
state properties and improve institutional services, the report
relays. The public now has access to reliable data on the real
value of properties owned by the Dominican State, the report
notes.
Santos highlighted that the census facilitates the optimal use of
state assets in services and production, aligning with strategies
that benefit the population, the report discloses.
Burgos Gómez reported that 46,737 state properties were registered
nationwide, with a total value exceeding RD$12.4 billion, the
report says. He underscored the census's importance in
understanding the state's assets and their value, the report notes.
He also expressed gratitude to the decentralized and autonomous
institutions that participated in the survey, the report relays.
The census consists of four phases, with the second phase focusing
on counting dams and land roads in the country, the report adds.
Additional details revealed:
-- The Legislative Branch's land and buildings cover
3,236,617.93 m², valued at RD$100,597,428,564.00.
-- The Judicial Branch has 7,492,709.56 m² of land and
buildings, valued at RD$35,508,242,165.39.
-- Constitutional bodies with extra power or reinforced
autonomy have 526,867.36 m², valued at
RD$15,456,954,145.67.
-- The Executive Branch covers 407,807.14 m², valued at
RD$9,383,960,932.00.
Furthermore:
-- Ministries possess 51,011,020.39 m2 of buildings and land,
with an economic value of RD$466,506,922,061.58.
-- Councils, commissions, and committees cover 62,613,982.20
m2, totaling RD$845,529,170,320.87.
-- Functionally decentralized organizations, which have legal
personality, cover 371,753,517.23 m2, valued at
RD$2,841,420,864,772.03.
-- Territorially decentralized organizations, part of local
government, cover 41,544,220.68 m2, valued at
RD$246,405,381,159.55.
About Dominican Republic
The Dominican Republic is a Caribbean nation that shares the island
of Hispaniola with Haiti to the west. Capital city Santo Domingo
has Spanish landmarks like the Gothic Catedral Primada de America
dating back 5 centuries in its Zona Colonial district. Luis Rodolfo
Abinader Corona is the current president of the nation.
TCR-LA reported in April 2019 that Juan Del Rosario of the UASD
Economic Faculty cited a current economic slowdown for the
Dominican Republic and cautioned that if the trend continues,
growth would reach only 4% by 2023. Mr. Del Rosario said that if
that happens, "we'll face difficulties in meeting international
commitments."
An ongoing concern in the Dominican Republic is the inability of
participants in the electricity sector to establish financial
viability for the system.
On December 4, 2023, the TCR-LA reported that Fitch Ratings has
affirmed Dominican Republic's Long-Term Foreign-Currency Issuer
Default Rating (IDR) at 'BB-' and revised the Outlook to Positive
from Stable. Fitch says the Positive Outlook reflects a trend
improvement in governance, and robust growth prospects that should
lead to continued gains in per capita income. According to Fitch,
growth has decelerated in 2023, but it expects Dominican Republic
to recover to high levels during 2024-2025. External liquidity
metrics have improved in recent years, and foreign currency share
of government debt is on a downward path.
In August 2023, Moody's Investors Service changed the outlook on
the Government of Dominican Republic's ratings to positive from
stable and affirmed the local and foreign-currency long-term issuer
and senior unsecured ratings at Ba3. Moody's said the key drivers
for the outlook change to positive are: (i) sustained high growth
rates have enhanced the scale and wealth levels of the economy; and
(ii) a material decline in the government debt burden coupled with
improved fiscal policy effectiveness will support medium-term debt
sustainability.
The affirmation of the Ba3 ratings balances the Dominican
Republic's strong economic growth dynamics and relatively contained
susceptibility to event risks, with a comparatively weaker fiscal
position, reflecting long-standing credit challenges which include:
(i) a shallow revenue base compared to peers, (ii) weak debt
affordability metrics, and (iii) high exposure to foreign currency
borrowing.
S&P Global Ratings, in December 2022, raised its long-term foreign
and local currency sovereign credit ratings on the Dominican
Republic to 'BB' from 'BB-'. The outlook on the long-term ratings
is stable. S&P affirmed its 'B' short-term sovereign credit
ratings. S&P also revised its transfer and convertibility (T&C)
assessment to 'BBB-' from 'BB+'. The stable outlook reflects S&P's
expectation of continued favorable GDP growth and policy continuity
over the next 12-18 months that will likely stabilize the
government's debt burden.
In February 2023, S&P said its BB ratings reflect the country's
fast-growing and resilient economy. It also incorporates the
country's historical political and social challenges in passing
structural reforms to contain fiscal deficits, despite recent
improvements in the electricity sector. The ratings are constrained
by relatively high debt, a hefty interest burden, and limited
monetary policy flexibility.
=====================
P U E R T O R I C O
=====================
VIGILANCIA VIRTUAL: Taps Alcides Reyes-Gilestra as Special Counsel
------------------------------------------------------------------
Vigilancia Virtual y Policia Privada LLC seeks approval from the
U.S. Bankruptcy Court for the District of Puerto Rico to employ
Alcides A. Reyes-Gilestra, an attorney serving San Juan, PR, as its
special counsel.
Counsel Reyes-Gilestra's legal representation will be limited to
representing the Debtor in matters related to the claims made by
the U.S. Department of Labor in the district court case. The
attorney will also provide consulting services to Debtor and its
counsel regarding any claim or appearance made by the U.S.
Department of Labor in the captioned bankruptcy case.
Mr. Reyes-Gilestra received a $2,5000 retainer and will charge $175
per hour for its services.
Mr. Reyes-Gilestra assured the court that he is a disinterested
person within the definition provided by 11 USC Sec. 101(14) .
The counsel can be reached through:
Alcides A. Reyes-Gilestra, Esq.
867 Muñoz Rivera Ave.
Vick Center, Suite C-401
San Juan, PR 00925
Tel: (787) 309-7295
Wmail: areyes@arglaw.net
About Vigilancia Virtual y Policia Privada
Vigilancia Virtual y Policia Privada LLC filed its voluntary
petition for relief under Chapter 11 of the Bankruptcy Code (Bankr.
D.P.R. Case No. 24-01678) on Apr. 24, 2024. In the petition signed
by Israel Martinez Gutierrez, president, the Debtor disclosed under
$1 million in both assets and liabilities.
Judge Mildred Caban Flores oversees the case.
Landrau Rivera & Assoc., led by Noemi Landrau Rivera, Esq., serves
as the Debtor's legal counsel.
=====================================
T R I N I D A D A N D T O B A G O
=====================================
TRINIDAD & TOBAGO: IEA Warns of Oil Price Decline
-------------------------------------------------
Trinidad Express reports that Prime Minister Dr Keith Rowley urged
Tobagonians to embrace the proposed construction of the island's
first all-inclusive resort as a way for Tobago to improve its
economic performance and be less reliant on money coming from
Trinidad.
Rowley told the post-Cabinet news conference that tourism is one
way of starting the diversification of the economy away from its
reliance on oil and gas and its generation of revenue from other
sources, according to Trinidad Express.
"Tobago needs more hotel rooms, Tobago needs quality jobs, Tobago
needs to improve its economy, not only for Tobago but for Trinidad
and Tobago," the Prime Minister told the news conference. He said
this is why he will not allow for another debacle as happened when
Sandals withdrew its decision to invest in Sandals and Beaches
properties on the sister isle, the report notes.
Trinidad Express relays that the Prime Minister said, "You all
chase the Sandals people out of Tobago, as Prime Minister of
Trinidad and Tobago I will move heaven and earth to make sure the
hotel is built at Rocky Point because there are Tobagonians who
don't have any trust fund and who are waiting for a meal."
Rowley's comments came at around the same time the International
Energy Agency (IEA) was predicting oil prices will fall in the
coming years as demand peak and production led by the United States
and other countries in the Americas, including Guyana and Brazil
result in output surpassing demand, the report says.
In its outlook published, the IEA said global oil markets will need
to traverse a myriad of challenges in the medium term as structural
shifts reshape oil demand and trade flows while rising oil supplies
could potentially weigh on prices through the end of the decade,
the report discloses.
The IEA said divergent regional economic trajectories and the
accelerating deployment of clean and energy-saving technologies are
combining to slow the pace of oil demand growth, with a plateau
emerging closer to 2030, the report notes.
"A ramping up of world oil production capacity, led by the United
States and other producers in the Americas, is expected to outstrip
demand growth over the 2023-2030 forecast period and inflate the
world's spare capacity cushion to levels that are unprecedented,
barring the Covid-19 period. Total supply capacity rises by 6
million barrels of oil per day (mb/d) to nearly 113.8 mb/d by 2030,
a staggering 8 mb/d above projected global demand of 105.4 mb/d,"
the report read, the report relays.
The IEA noted that emerging economies in Asia, particularly China
and India, account for all of global demand growth, the report
says. By contrast, oil demand in advanced economies falls sharply
under its models, the report notes.
Rising world oil supplies, led by non-OPEC+ producers, are expected
to surpass forecast demand from 2025 onwards, the report
discloses.
The IEA said even Saudi Arabia has put on hold its planned crude
oil capacity increase and will now focus on expanding natural gas
liquids and condensates, which aligns with its efforts to boost
domestic gas supply, and the move may also reflect an
acknowledgment of the rapidly building surplus in global crude oil
production capacity, the report relays.
"The rise of petrochemicals as the main pillar of global demand
growth largely tracks the substantial increase in the global supply
of (Natural Gas Liquids) NGLs, which are instrumental in their
production. At the same time, these changes will also create new
challenges for refiners as demand for refined products is displaced
by non-refined products such as NGLs and biofuels. Non-refined
fuels are set to capture a staggering three-quarters of projected
global demand growth over the 2023-2030 period," the IEA said, the
report notes.
It said refiners must reconfigure their product slates to meet
divergent trends for distillates amid reduced consumption as the
energy transition accelerates, the report relays. This is
especially the case in road transport fuels as EVs (electric
vehicles) rapidly increase their market share, the report
discloses.
"Amid all these structural changes to supply and demand patterns,
the global oil market outlook faces further uncertainties from
weaker macroeconomic expectations, new government policies and
regulations to fast-track the energy transition, and an
unprecedented level of investment to scale up more efficient
technologies," the IEA noted, the report notes.
Prime Minister Rowley and Finance Minister Colm Imbert have
recently talked about the urgent need to reduce the over-reliance
of the T&T economy on the production and sale of oil and gas, the
report adds.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter-Latin America is a daily newsletter
co-published by Bankruptcy Creditors' Service, Inc., Fairless
Hills, Pennsylvania, USA, and Beard Group, Inc., Washington, D.C.,
USA, Marites O. Claro, Joy A. Agravante, Rousel Elaine T.
Fernandez, Julie Anne L. Toledo, Ivy B. Magdadaro, and Peter A.
Chapman, Editors.
Copyright 2024. All rights reserved. ISSN 1529-2746.
This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers.
Information contained herein is obtained from sources believed to
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The TCR Latin America subscription rate is US$775 per half-year,
delivered via e-mail. Additional e-mail subscriptions for members
of the same firm for the term of the initial subscription or
balance thereof are US$25 each. For subscription information,
contact Peter A. Chapman at 215-945-7000.
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* * * End of Transmission * * *