Daily Archives: Apr 19, 2012

More blue water opening up between Argentina and its regional peers: Bogota on Wednesday launched a formal WTO complaint against Buenos Aires over import restrictions. Nor does Colombia want anyone to even begin to think it would ever contemplate a move comparable to Argentina’s nationalisation of YPF.

“We don’t expropriate,” says Colombian President Juan Manuel Santos. “We are a state of law and do everything humanely possible to respect rules.” Read more

By Jimmy Greer of Brazilintel

Few things are more likely to invoke the suspicion of very serious people in advanced economies than loose talk about measuring national “happiness”.

You can imagine the eyebrows rising further when an institution in an emerging economy like Brazil – a country with plenty to do in delivering higher standards of living to much of its population – says it is about to embrace the idea. But news that the Fundação Getulio Vargas in São Paulo (FGV-SP), a higher education institution and think tank, is setting out to measure Brazil’s gross national happiness (felicidade interna bruta, or FIB) should be taken seriously. Read more

Is the Polish economic miracle running out of steam?

That is one of the worries following Thursday’s industrial production data release, which showed a sluggish 0.7 per cent annual increase in March, compared to the 4.4 per cent increase predicted by economists polled by Bloomberg. Read more

Top emerging market bond fund managers are in short supply in the general rush to increase fixed income investment in the developing world.

The UK’s Standard Life Investments has poached a three-man team from London-based Threadneedle Investments to create its own emerging markets bonds desk.

It won’t be the last such move. As beyondbrics has reported, many bond fund managers are fundamentally reassessing the traditional split between developed and developing markets in their portfolios – and shifting money into EMs. Read more

Dubai Inc is well on the way to completing $34bn in debt restructuring triggered by the 2009 financial crisis thanks largely to a policy of “bail out bondholders, burn the banks”, says Exotix, the investment broker.

Honouring bond investors’ claims has helped restore Dubai’s creditworthiness and allowed its government-related enterprises (GREs) to return to the capital markets. However, there aren’t many other governments that could follow Dubai’s example in forcing the bulk of the restructuring onto the banks, both local and international. Read more

Fuel subsidies are a divisive issue, especially in sub-Saharan Africa. The Nigerian government’s attempt to cut subsidies in January, for example, provoked a nationwide strike and violent protest and was followed by a humiliating partial climbdown.

A World Bank report published this week looks at the cost and impact of fuel subsidies in the region. It finds they benefit the rich far more than the poor and that public money could be better spent in other areas. The trouble is, poor Africans don’t trust their governments to do that. Read more

India’s biggest banks have accepted “suggestions” from the authorities and followed the central bank’s rate cut this week by reducing their own lending rates months before analysts had expected.

On Thursday, India’s largest private bank, ICICI Bank, and second-largest state-owned bank, Punjab National Bank, cut lending rates by 25bps, to 9.75 per cent and 10.50 per cent respectively – two days after the Rreserve Bank of India’s surprisingly aggressive 50bps-interest-rate cut.

State Bank of India, India’s largest, has also said that it plans to cut lending rates, while IDBI Bank, a small state-run lender, cut its base rate 25bps to 10.50 per centRead more

Pimco, the world’s largest bond fund manager,  is backing moves by international investors to rebalance bond portfolios away from the developed world in favour of emerging markets.

It’s a way of boosting returns and helping to revive the world economy, says Ramin Toloui, Pimco’s executive vice president, citing the example of Norway’s $600m sovereign wealth fund, which increased its focus on EMs in a strategy change announced last month. And where Norway goes, other big investors are sure to follow. Read more

The Gulf is bidding to win a share of the fast-moving global copper trade.

The Dubai Gold and Commodities Exchange will launch a copper futures contract this week, offering investors arbitrage opportunities with the leading copper markets  in London and New York, as well as Mumbai and Shanghai.

As Camilla Hall reports for the FT’s Middle East edition, the exchange plans to launch trading in 5-tonne, cash-settled $-denominated copper contracts on April 20. Read more

* Brazil cuts rates further as growth slows

* UN probes claim of China sanctions breach

* IMF sees banks deleveraging by $2.6tn

* Deripaska’s Russian Machines to seek $3bn in IPO Read more

Thursday’s selection from the beyondbrics team: liberty, equality and nepotism in China; past and present problems of Argentine nationalisation; the need to be mulitlingual; and is China playing a double game in North Korea? Read more

For those who moan endlessly about unsightly cables running out of the TV or DVD player, help may at last be at hand. Sweden’s Ikea and China’s TCL Multimedia have come up with an answer, furniture with built-in appliances. Read more

Behind every fallen Chinese man, there stands a great woman. The purge of Bo Xilai, once seen as a top leadership contender in China, has added to a long list of powerful officials who have been felled by the alleged misdeeds of their wives, mistresses and mothers.

For a country never short on conspiracy theories, the police decision to focus on Gu Kailai, Bo’s wife, in a murder investigation calls to mind its centuries-old tradition of blaming women when political turmoil erupts. Read more

The debut of the Phnom Penh Water Supply Authority on Wednesday was the most exciting IPO in Asia this year. It marked the start of business on the brand new Cambodian Securities Exchange, underlining the extent of change in this fast-growing country once under the grip of the murderous Khmer Rouge. Plus, it’s already up 55 per cent.

Laos launched its exchange last year and Myanmar is now planning one as well. How much difference can a stock exchange make? Read more

Brazil’s central bank president, Alexandre Tombini, slashed the country’s interest rate on Wednesday to 9 per cent, bringing it close to a 15-year low. But he’s shown no signs of stopping there.

For the majority of analysts, Wednesday’s rate decision was no surprise. However, what they hadn’t been counting on was the statement that followed. Read more

* Brazil cuts rates further as growth slows

* UN probes claim of China sanctions breach

* IMF sees banks deleveraging by $2.6tn Read more

Call it a challenge to the Indian government, or, at least, a passive aggressive push in the right direction.

In the policy statement accompanying its surprisingly aggressive 50bps interest rate cut on Tuesday, the Reserve Bank of India made one thing abundantly clear: no more rate cuts unless the government gets its fiscal house in order. Read more

Brazil’s central bank has cut its benchmark interest rate by 75 basis points to 9 per cent, as expected.

Here’s the accompanying statement: Read more