Vale: big ship springs big leak
We’ve all been there. You buy something on the cheap made in China or South Korea, but as soon as you get home it breaks. Unfortunately for Vale, Brazil’s mining giant, the same thing seems to have happened with their 400,000 ton iron ore carrier.
The ship is part of the company’s brand-new fleet of 35 mega vessels being built at Asian yards – a wildly ambitious multi-billion dollar plan by the (ousted) former chief executive to cut freight costs. Continue reading »
Tensions rise before Saturday protests
Tensions are rising in Moscow where tens of thousands of people are expected to join opposition protests on Saturday against the results of a parliamentary election held last weekend – causing big falls in equity prices as investors flee Russia’s worsening political risks.
In a sign of rapid momentum behind the challenge to Vladimir Putin, more than 35,000 people have signed up on Facebook to join the rally that is set to be the biggest street protest seen in the Russian capital since the turbulent 1990s. Continue reading »
Chart of the week: the scale of shale
This week PetroChina discovered shale gas in China’s Sichuan province. How significant is this find for China’s energy supply and how does it compare to shale and natural gas reserves in other countries?
Chart of the week takes a look behind the figures to get a better idea. Continue reading »
Czechs and CEE: all in it together
The Czech economy contracted in the third quarter, falling by 0.1 per cent compared to the second as all elements of demand slowed, according to the central bank. This was the Republic’s first contraction since 2009. A recession, technically two consecutive quarters of GDP contraction, could be just around the corner.
Beyondbrics has taken a look at how its neighbours are faring – and how much they all depend on exports to the EU. The prognosis is not great. Continue reading »
Another Indian reform massacre
It was another massacre.
As if it weren’t already clear that India’s ruling Congress party’s ability to enact meaningful reforms had died an early death, Thursday night offered up fresh kills in the form of three key reforms. Continue reading »
Putin leans on aluminium oligarchs
Vladimir Putin may be facing a wave of protests in the streets of Moscow, but he does not appear to have lost his grip on Russia’s powerful oligarchs.
Not for the first time the Russian prime minister has intervened in the aluminium industry, ordering a company to keep an aged smelter going even though economics might dictate otherwise. This is pure Putin – no market liberal but a man with his finger on the popular pulse. Continue reading »
Poland: Goodbye London, hello Berlin
Not long after Poland joined the EU in 2004, there was a popular theory making the rounds in Warsaw that the country’s future lay in carving out a role similar to that of the UK – in the EU but a little standoffish, dedicated to free trade, pro-American, and a bit suspicious of Germany.
The last few days have shown just how far Poland has drifted from that position to one where Poland’s pre-eminent relationship is with Germany, and the overriding foreign policy priority is to be tightly lashed to the core of the EU and the eurozone. Continue reading »
City of Lima coming to muni market
The city of Lima is coming to the muni market. Not Peru’s very own, mind you, but that of dollar-denominated municipal bonds.
Susana Villaran, the mayor of Peru’s capital city, spent most of Thursday in New York in meetings with potential investors, book runners and rating agencies to discuss her plans to issue $500m in 10-year bonds. Details of the offer – Lima’s first in international markets – will be finalized in the next six months. Continue reading »
Chinese corruption: no more cash
In China, cash is king – but maybe not for much longer.
In a bid to fight corruption, the finance ministry this week forbade public employees from using cash to pay for certain offices expenses. Instead, they must use office-issued credit cards to pay for things like entertainment, transport, training and consulting fees. Continue reading »
India in crisis? Not just yet
The rapid depreciation of the rupee since August is bleeding into all aspects of the Indian economy, leading some analysts to predict a crisis the likes of which India has not seen in 20 years.
But economists told beyondbrics that, while India’s financial situation was indeed dire – given the weak rupee, widening trade deficit, high fiscal deficit and slowing growth – the country is not yet on the brink of crisis. Sounds bad, though – so what are the prospects? Continue reading »
Erste’s bill for Hungary: 450 jobs
With delicious irony, Erste Bank (EBS:VIE) on Friday chose a big Vienna financial conference to announce details of plans to cut back in Hungary with the loss of a quarter of its branches and up to 450 staff.
Chief executive Andreas Treichl turned Capital Markets Day, an event that generally celebrates banking, into an occasion for delivering some bad financial news to Budapest.
New York headlines
* EU leaders fail to agree treaty changes
* Chinese inflation cools to 4.2% in November
* European banks have €115bn shortfall
* Alibaba seeks $4bn in financing for Yahoo Continue reading »
India: cementing the slowdown
Gloom threatens to engulf the Indian economy on a number of fronts – stagnating industrial production, slumping auto sales, slowing growth. But, more than any other sector, infrastructure would be the first to show signs if the country were truly slowing down — and if cement is anything to go by, that is exactly what is happening. Continue reading »
Further reading: yearning for safety
Friday’s top picks from the beyondbrics team: Lex on China’s drive for resource security and why European bank interests in Asia are looking particularly expendable; why a slowing China may be more of a problem for the rest of the world than for China itself; the rise of high frequency trading in Brazil; and the eroding state of Israel’s democracy. Continue reading »
Fund flows: calm before the next storm
A day is a long time in the financial markets, so the latest euro-inspired sell-off came too late for this week’s EPFR figures on fund flows.
These show that last week’s co-ordinated central bank intervention calmed investors and stabilised flows for emerging markets funds after the recent heavy outflows. Continue reading »
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