South Africa: more strikes in 2012
photo: Bloomberg
If corporate South Africa was hoping for some festive cheer from its country’s powerful unions after enduring a wave of painful strikes this year, it should think again.
In a defiant speech to mark the end of 2011, Zwelinzima Vavi (pictured), general secretary of the Congress of South African Trade Unions (Cosatu), threatened two separate campaigns of industrial action for early next year. Continue reading »
Mercosur enlargement? Not likely
Heads of state of the Mercosur trade block are meeting in the Uruguayan capital, Montevideo, where high on the agenda is enlarging the four-nation body, currently made up of Argentina, Brazil, Paraguay and Uruguay.
But with the global crisis forcing an ever wider wedge between the first two, who want more protectionism, and the last two, who want more trade, the chances of progress look remote. Continue reading »
Kim Jong-il and you
When is a dictator’s death good for your pension? When that dictator is Kim Jong-il. Here’s how.
According to Andrew Chappell of Exotix, the frontier markets specialists, a number of blue chip institutional investors are holders of North Korea’s (admittedly tiny stock of) foreign debt. That means that if – as Exotix hopes and believes – those investments pay off, you, dear reader, could be quids in. Continue reading »
Lithuania’s central bank: ready to act
These are desperate times and central banks all over the world are turning to extraordinary measures to pump liquidity into ailing banking systems. Lithuania’s central bank is no exception. On Tuesday it sent a clear signal to its banks that it is ready to act if needed. Continue reading »
Brazil’s inflation: down to the wire
No need to write them a letter
It’s like watching Corinthians fighting it out for this year’s Brazilian football championship but without the swearing and sweaty punch-ups.
The central bank has been promising for months it will be able to meet the government’s 2011 inflation target of 4.5 per cent, plus or minus 2 percentage points. But after many twists and turns, disappointments and lucky breaks, it looks like we’ll have to hang on to the very last minute to see whether they can actually pull it off. Continue reading »
Taiwan’s banks: a little liberalisation
Taiwan on Tuesday opened the doors a little wider to Chinese money by announcing that Chinese banks and investors will be allowed to take small stakes in Taiwanese banks.
Taiwan’s main financial regulator announced in a statement that, from January 2 onwards, eligible Chinese banks will be able to take up to a 5 per cent stake in a Taiwanese bank, while other non-bank investors will be allowed up to a 10 per cent stake. Continue reading »
Hungary: central bank rate rise bolsters forint and annoys government
Hungary’s central bank on Tuesday boosted the forint with a 50 basis point increase in its benchmark interest rate to 7 per cent, the highest in the European Union.
But even that may not be enough in the light of Budapest’s need for external financial support and the government’s dispute with the International Monetary Fund/European Union. Investors are pricing in another 25 basis point rise over the next month. Continue reading »
Tanzania’s Precision Air: no easy ride
Red carpet ready but investors fail to show
A turbulent initial public offering by Precision Air, Tanzania’s largest national carrier, has left some Africa watchers scratching their heads.
Precision, which on Wednesday will become the 17th company listed on the Dar es Salaam Stock Exchange, raised just 42 per cent of a planned 28bn shillings ($17.6m) from equity investors in its IPO. Continue reading »
Snap: Hungary raises rates
Hungary raised interest rates for the second time in as many months on Tuesday, lifting its benchmark by 50 basis points to 7 per cent. The central bank wants to protect the forint in the foreign exchange markets while the government talks to the European Union and International Monetary Fund about financial support.
Another explosion rocks Apple’s Chinese supply chain
Serious safety concerns have emerged at another Chinese factory supplying Apple after a weekend explosion in which local media said dozens of workers were injured. The blast on Saturday happened at a metal casing factory owned by a subsidiary of Pegatron of Taiwan, a major main metal casing supplier and a contract manufacturer for Apple products. Continue reading »
New York headlines
* ‘Great Successor’ takes power in N Korea
* Japan in talks with China about purchasing government debt
* ECB warns of global contagion risks
* Saudi prince buys $300m stake in Twitter Continue reading »
Poland and Moody’s: enviable praise
With most of Europe staring down the barrel of ratings downgrades, Poland had the right to some self-satisfaction on Tuesday morning. Moody’s reaffirmed the country’s A2 credit rating with a stable outlook, citing its “strong and proven track record” of economic stability – the kind of comment some big western European countries can only dream of. Continue reading »
Further reading: goodbyes
Tuesday’s top picks from the beyondbrics team: Gideon Rachman says farewell to a dumb war in Iraq; the death of Kim Jong-il and the dangerous void he has left behind; why hedge funds are worried that the next act in the debt crisis may be played out in the east; and why India’s new Food Security Bill is likely to hurt the poor more than it helps them. Continue reading »
Serbia and Russia: cosying up
Serbia is set to sign a 10-year deal with Gazprom on Thursday that will cement its growing dependence on Russian gas, but also position the country favourably as an energy-supply hub for south-eastern Europe.
The new contract covers prices for natural gas and the contruction of gas-fired power plants and additional gas storage sites, said Dusan Bajatovic, head of Srbijagas, the state-run gas distributor.
Just as economic gloom is gathering and prospects of further European Union enlargment look shaky, state-run Russian companies are making their presence felt in Serbia more than ever. Continue reading »
RMB reform: helping equities
China is getting nervous; its equity markets are having a really bad year, its currency is suffering, a property crash may be coming and capital is leaving its shores.
In an attempt to help, the Chinese securities regulator announced late on Friday that renminbi held offshore could be used to buy equities within China – it is also reportedly planning to ease restrictions on foreign institutions’ direct involvement in China’s markets.
These are long-awaited reforms but – while important as a signal of China’s commitment to liberalising capital flows and internationalising its currency – in the short-term the move may not be as significant as it seems. Continue reading »
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