Daily Archives: Sep 2, 2011

There’s nothing Brazil’s finance minister, Guido Mantega, loves to talk about more than currency wars. Another opportunity presented itself on Friday when the country’s GDP data was released.

Brazil’s growth slowed to 0.8 per cent in the second quarter, down from 1.2 per cent in the previous three months. Industrial production was the main culprit, growing only 0.2 per cent.

Who is to blame though? Well, according to Mantega, it’s the USRead more

Bourses in emerging markets came under selling pressure on Friday following four consecutive days of gains this week. The reason? Disappointing US payroll data, little light at the end of eurozone debt crisis tunnel and more bearish investor sentiment

Stock markets in Asia, central and eastern Europe all ended the day in the red, while bourses in Latin American were also down during the afternoon trading session.  Read more

Czech mall is emptyThe pressure on Czech consumers is set to increase after the Czech parliament approved a series of value-added tax hikes on Friday. The move will bring nearly $1.35bn into the country’s exchequer, but is likely to hit already low consumer spending.

The bill, which now goes to the Senate for rubber-stamping, would lift the lower VAT rate on basic goods and services such as food, drugs and public transport by 4 per cent to 14 per cent next year, while the upper bracket VAT rate for things like cigarettes and alcohol would stay at 20 per cent. Read more

Soaring energy prices are driving Russia’s oil output to record highs. But how long can the world’s biggest oil producer keep it up?

Not very long, according to industry analysts, unless the government reforms the tax system to encourage investment at oilfields.

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Ten years ago a Chinese delegation visited Brazil with a simple request: Can we have some iron ore, please?

Specifically, they wanted to buy Vale SA, the world’s biggest miner of iron ore. That may seem like a bit of a long shot, but China Inc is playing the long game in Latin America, quietly and slowly building up its presence in the region. An announcement on Friday that a Chinese consortium will acquire a a 15 per cent stake in a Brazilian miner for $1.95bn is just another example. Read more

Emerging markets have been good to carmakers and South Africa is no exception. At first glance August vehicle sales figures published on Friday support the story of an ongoing boom – with overall sales up 11.1 per cent year-on-year in August, from 10.5 per cent in July. But parsing the numbers, it’s not all positive news.

Specifically, passenger vehicle sales are beginning to slow, a reflection of increasingly cautious consumer confidence. Read more

Sec_sickbricsShaven heads are all the rage in Venezuela at the moment. It is meant as a show of solidarity for Hugo Chávez, who is undergoing his third round of chemotherapy, and has lost all his hair.
But the trend has taken a new turn. After a group of state electricity workers cut off all their hair this week to draw attention to the “terminal cancer” afflicting their company, it may not be long before doctors try a similar stunt. Such is the state of Venezuela’s health sector that even Chávez preferred to jet off to Cuba to get his cancer treated. Read more

Embargo on Syrian crude could have impact on prices

Taiwan’s Tsai stresses slower track for China ties

Permira sells stake in Macao casinos

Brazil: room to manoeuvre

Tax protests cloud outlook for Chile’s miners

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Nokia VietnamIn the midst of an economic crisis, Vietnam’s government pulled off a coup back in March when it convinced Nokia, the world’s biggest mobile phone maker, to locate its latest factory in the country.

The government did its best to milk the publicity with Nokia bosses, hosted at a reception by the then Vietnamese president, Nguyen Minh Triet, who vowed to roll out the red carpet for the company. But, like many other Western companies, Nokia is finding that investing in Communist Vietnam is not easyRead more

An advertisement for renminbi bonds in Hong KongAfter weeks of heavy inflows into EM local currency bond funds, investors have taken a sudden break.

In the week to Wednesday, such inflows totalled just $50m net, down from $512m in the previous seven days and a fraction of the $400m weekly average recorded in recent months, according to data from the EPFR research company.  Could it be the end of his year’s investor infatuation with EM currencies? Read more

Turkey’s economic statistics might make the country look like anything but a safe bet among emerging markets.  The chronic savings deficit,  high unemployment, and an 8 per cent current account deficit trouble many investors. So does a stop-start economic record.

But in its latest EM report, Bank of America Merrill Lynch argues that the outlook for Turkey, when compared to other EEMEA countries, is actually pretty good. All that is needed is economic stability and a bout of serious reforms. Quite. Read more

Friday’s best picks from the beyondbrics team: why it’s hard to see the woods for the trees in China, and a warning to Exxon from the Moscow Times not to pop the champagne just yet. Also, leave it to China to build the world’s highest ferris wheel – 450 metres above ground!

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MacaoAfter another sizzling set of numbers from Macao’s gaming industry, casino owners could probably be forgiven for sitting on their laurels. The territory’s economy grew 24 per cent in Q2, thanks mainly to gambling revenues, which are growing at a rate of 57 per cent year-on-year.

But rather than breaking open the cognac, gaming bosses are looking to the future – and over the water to a sparsely populated island called Hengqin. Never heard of it? You soon will. Read more

The world’s economic leaders need to “rebalance” their thinking as well as their economies. China’s growth has been a source of strength in the crisis, but its leaders know their growth model is unsustainable, writes World Bank president Robert Zoellick.

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* Embargo on Syrian crude could have impact on prices

* Taiwan’s Tsai stresses slower track for China ties

* Brazil: room to manoeuvre

* Indian government ‘disturbed’ as food inflation soars Read more

Sec_sickbricsThe human cost of doing business in India has been known to multinational employers for centuries.

Niall Ferguson, the Harvard historian in his book titled “Empire” describes how in the days of the British East India Company fortunes and careers were made in India. Read more