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Weekly Report - 25 November 2003

Tracking trends...

JAMAICA | Growth outlook. GDP growth has been slowing down: in the third quarter, GDP was 1.2% up on the same period last year, paring down the increase over the first nine months to 2.1%. The deceleration resulted from a 0.9% decline in the goods-producing sector weighing down the 2.3% expansion in services. And that decline was largely up to the 5.9% slump in manufacturing: mining and quarrying was up 4.9%, agriculture 4%. Expansion in services was led by finance & insurance (5.9%) and electricity & water (4.9%). The planning institute, PIOJ, is expecting a slightly higher GDP growth rate of 1.8% in the last quarter.

DOMINICAN REPUBLIC | Oil at last? Conflicting reports have surfaced regarding Murfin Dominicana's search for oil in the southern Cibao region of the Dominican Republic. One, on 19 November, says that three of 14 wells drilled show commercially exploitable deposits. Another, from Murfin Drilling Company, says more testing is yet needed. Once before, the illfated President Antonio Guzmán (1978-82) announced a find that did not materialise.

GUATEMALA | Korean pullout threat. Korean maquiladoras (assembly plants) may start pulling out of Guatemala as a result of the latest salary increase decreed by the government, which takes minimum pay up to US$177 a month (versus US$60 in Nicaragua, US$40 in Haiti). The warning came from Bong Chung Park, vice-president of the Asociación de Maquilas Coreanas. Korean assembly plants give employment to about 72% of the 138,000 workers in Guatemala's maquila sector.

COSTA RICA | Investment patterns shifting. Foreign direct investment (FDI) has been shying away from tourism: this year it is expected to attract only US$54.5m, down from US$111.5m in 2001, and below the US$56m a year average that other services have been receiving over the past couple of years. The latter's share of total FDI has increased from 1% in 1998 to an estimated 12% this year. The main target for FDI in Costa Rica continues to be the industrial sector, expected to account for 62% of the total this year.

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