Only the Argentines know why they still have not asked formally for a renegotiation of a trade agreement on cars that it has with Mexico.
This week, the country’s minister of industry said that the country would seek to do exactly that – presumably in an attempt to piggy-back on the example of Brazil, which last week renegotiated its own car agreement with Mexico to cap Mexican exports for the next three years.
But while Buenos Aires’ silence on the issue so far is unclear, one thing is crystal: the answer they will receive if and when they finally do get around to asking is going to be a big fat No. Continue reading »
Choosing leaders for the World Bank used to be a mundane task. The candidate should be, let’s see, a US citizen, politically well-connected and have nothing to do with development. Citizens of other countries please do not incommode the board with your applications.
Suddenly that has changed. A contest has erupted that provides a colourful mirror of the times we live in. Continue reading »
Argentina used to be South America’s powerhouse in terms of industrialised beef exports – things like corned beef, beefburgers and steak and gravy.
But at least one company seems to think it’s bovine-related glory days are behind it. This week, Brazil’s JBS SA, the world’s biggest beef producer, slashed its Argentine production – the country now represents less than 1 per cent of total sales – and has put its foot down: No more losses in Argentina. Continue reading »
Russia’s ministry of natural resources fired a shot across the bows of Lukoil on Friday, warning that the Russian oil major could lose the right to develop two huge Arctic oil fields in a partnership with Bashneft.
In the past hints like this have led to disputes in which the state damaged the interests of private oil investors – even to the extent of grabbing a share of strategic upstream assets. So although Lukoil and Bashneft’s shares have hardly reacted to the news, it’s worth watching closely to see how events play out. Continue reading »
By Kevin P Gallagher of Boston University
Emerging countries have gone on the offensive to put an end to the “wink-wink” succession rule whereby Europeans get to choose who heads the International Monetary Fund and the US picks the president of the World Bank.
On Friday, developing countries are expected to nominate at least two candidates – Ngozi Okonjo-Iweala, the Nigerian finance minister, and José Antonio Ocampo, former finance minister of Colombia. If the decision is finally based on merit, as it should be, Ocampo will win: he is far and away better than any on the list of credible names, including President Barack Obama’s nominee, Jim Yong Kim. Continue reading »
Time for a change of plan. With the Mediterranean region in economic trouble, Enel, the Italian electricity utility, is looking not just at new energy, but also new markets.
Enel Green Power, the listed renewables unit of Italian utility Enel, plans to invest €6.1bn over the next four years as it shifts its focus from mature Europe to new emerging markets, including Turkey, Morocco and South Africa. Continue reading »
Are EM currencies giving up their gains? There was a hint that investors may think so on Friday: flows into EM local currency bond funds, which have been on a roll for much of the past year, fell sharply in the week to Wednesday, according to EPFR, the fund flow watcher.
One week’s numbers don’t constitute a trend and it may simply have been time for a correction. But the change makes sense when you consider that EM currencies have weakened this month – led by Brazil, former champion of currency war underdogs and now looking increasingly like an aggressor. Continue reading »
Indonesia may have banned the export of raw rattan to insulate furniture makers from China’s demand for the material – but on other fronts trade has racing ahead between the two Asian nations.
At a visit by Indonesian president Susilo Bambang Yudhoyono to Beijing this week, the two nations signed up for new deals worth up to $17bn, according to Chinese state media. While rattan chairmakers might not be too fond of China, Indonesia needs more investment, particularly in infrastructure, and Chinese firms are well-positioned to supply it. Continue reading »
Barack Obama will nominate Jim Yong Kim, head of Dartmouth College, to be president of the World Bank, the FT reports.
Kim, a physician who has played a leading role in global health, covers the US vs EM angle by having been born in Seoul but since acquiring US citizenship. Nevertheless, his choice was a surprise to many analysts. He wasn’t even in the running according to Paddy Power, which had Larry Summers and Jeffrey Sachs as favourites.
Poland’s centrist government has until now largely avoided undertaking politically-tricky economic reforms – and the current fuss over a proposal to increase the retirement age shows that it was right to be worried about stirring up trouble.
The plan has brought thousands of protesters onto the streets, prompted labour unions to threaten strikes during the upcoming European football championships, and led to the deepest crisis in the governing coalition since it first won power five years ago.
The markets so far seemy unruffled by the turmoil – largely because investors expect the reform will ultimately be adopted. But if they are wrong, the zloty might be riding for a fall. Continue reading »
Finally some good news for Reliance Industries and BP at their natural gas field in the Bay of Bengal, the Krishna Godavari’s D-6 field.
On Thursday, the minister of state for petroleum and natural gas told parliament that the government had in January approved a $1.53bn investment plan to produce 10m cubic meters of gas per day from satellite fields in the basin, which has been plagued by disappointing underproduction since it was first tapped in 2007. Continue reading »
* Indian coal: damage limited – for now
* Mexico calls for open World Bank choice
* Chinese banks: doubts linger Continue reading »
Shares in AgBank – China’s No.3 lender by market value – fell 3 per cent in Hong Kong on Friday after it released full year earnings that came up short. The broader market was also down, but only by 1 per cent.
Though some analysts say investors can dismiss the miss, the market looks nervy. Continue reading »
For lessons in how not to build investor confidence, look no further than Abuja. A public hearing into the inability of the capital markets to recover strongly from the 2008-09 stock market crash began in the capital last week – a good thing, one might think.
Instead, the sessions quickly degenerated into a damaging confrontation between chairman of the House of Representatives Committee on Capital Markets, Herman Hembe, and the director general of the Securities and Exchange Commission, Arunma Oteh (pictured), who traded accusations of bribery on live television. Continue reading »
The recent drop in the Malaysian ringgit hasn’t had the same impact as declines in other key EM currencies headed by Brazil’s real.
But the ringgit is down 2.6 per cent this month against the US dollar: that makes it the fifth-worst performing emerging market currency in March – behind the real, the Indian rupee, the South African rand and the Turkish lira but ahead of the widely-watched Hungarian forint.
It’s not necessarily a sign of economic weakness in Malaysia: more a reflection of the ringgit’s inherent volatility as a liberalised and widely-traded currency. In risk-on times, investors buy the ringgit; risk-off, and they sell. Continue reading »