Daily Archives: Nov 23, 2012

It was only a matter of time. Take a nation full of shopaholics and retailers desperate to shift stock in a slowing economy and what do you get? Black Friday.

Brazilians have toyed with the US tradition for a couple of years now and even neighbouring Paraguay has proved to be a fan. However, this year Black Friday in Brazil came with a bang. 

The ballyhoo over a New York court ruling ordering Argentina to pay $1.3bn to holdout creditors, has raised questions over whether Ecuador could also be dragged to court by so-called vulture funds.

Unfortunately for some bondholders, but luckily for Ecuador’s government, it seems very unlikely, at least according to some commentators consulted by beyondbrics. 

After a decade of virtually frozen tariffs that has pushed them to the brink of collapse, and a major power cut earlier this month, electricity and gas companies in Argentina have finally heard the magic words they have been longing for the government to say: higher tariffs.

Unfortunately for them, there’s a catch. They won’t get the money. A special government-administered fund will

There was an old adage during the gold rush that the guy running the grocery shop and the saloon made a killing, while prospectors lost their shirts. It seems that the same principle applies to the humbler world of road building and asphalt supplies.

As the dust settles on Poland’s ambitious road building programme it turns out that somebody did make money on building hundreds of kilometres of new highways. It just wasn’t the people building the roads, but the companies making the asphalt – Poland’s two largest refiners, PKN Orlen and the Lotos Group. 

There was a time, not long ago – until Wednesday night, to be exact – when investors would pay a premium on emerging market debt subject to New York law. Not any more.

Judge Thomas Griesa’s ruling that Argentina must pay $1.3bn to holdout creditors has all sorts of implications for sovereign borrowers and lenders. It has also, at a stroke, wiped out the New York law premium, as a chart from Vladimir Werning at JP Morgan illustrates. 

One of the strangest recent developments in Turkey has been gold sales to Iran, which have soared, so helping improve the country’s trade and balance of payments figures.

Thanks to this phenomenon, Turkey, traditionally a net importer of the metal, has racked up net gold exports of $5.5bn off the back of total gold exports of some $13bn so far this year, as Gunay Elif Girgin at Oyak Securities in Istanbul pointed out to beyondbrics. 

Investors cheered this week when Egypt announced it was ready to sign up to an International Monetary Fund programme that includes extensive fiscal and structural reforms. And they cheered again when newly-elected president Mohamed Morsi made such a significant contribution to the Gaza ceasefire.

But they may stop cheering following a controversial decision to boost his presidential powers that has prompted protests across Egypt. A salutary reminder that however pressing the economic challenges, in Egypt politics comes first. 

MMK, Russia’s third largest steel producer, on Friday joined rivals Severstal and NLMK in pinning a gloomy forecast to its third quarter results as the falling price of steel undermines business. 

British fashion retailer Topshop has opened its first African store in Johannesburg’s up-market Sandton City mall – a vote of confidence both in South African consumer spending and also the country as a way in to the rest of the continent. 

Alisher Usmanov, Russian oligarchWhatever the reason behind Goldman Sachs’ decision to exit as underwriter of Megafon’s forthcoming IPO, the move was a kick in the teeth for the Russian mobile telephone operator run by Alisher Usmanov (pictured) that is now courting potential investors on a road show.

But leaving aside the shock of Goldman’s move, how does Megafon shape up compared to its publicly-listed Russian telecom peers? 

Japanese carmakers have had a rough time of it in China for the past two months, hit by plummeting sales due to the Sino-Japanese islands dispute.

But they have not shied away from the Chinese auto industry’s biggest event of the autumn, the 10th China International (Guangzhou) Automobile Exhibition, held in the stronghold of Japanese cars on the mainland, southern China. 

By Naguib Sawiris

Most governments in North Africa acknowledge the role of foreign direct investment in relieving poverty and encouraging economic growth – and in helping countries to respond to the challenges raised by the recent political upheavals in the region.

This is why the behaviour of the Algerian government, in threatening to rip up legal commercial agreements and investment treaties and in targeting one of the country’s largest foreign investors with a campaign of harassment and interference, is so damaging. Its actions could have a devastating impact on the business climate in Algeria and cast a shadow over the investment prospects for the whole region. 

* Asian stocks outside Japan fall as talks continue on Greek aid

* Walmart suspends India employees

* Argentina angry at hedge fund court win 

Not every company would be happy to have a prominent right-wing extremist on its roster of clients. But for Topsgrup, India’s largest private security company, Bal Thackeray – leader of the Hindu nationalist Shiv Sena political party and one of the most powerful men in Mumbai before he died this month – was just an ordinary Joe. 

Friday’s picks from the BB team: China falls back to earth, without a thud; London’s appeal for Asia’s newly rich; and can 1.2bn people be a democracy? Plus: the risk of war in central Africa; Egypt’s role in the ceasefire; and Russia’s reliance on oil and gas revenues.