Daily Archives: Dec 13, 2012

Photo: Bloomberg

He’s been named Latin America’s central banker of the year (okay, by a trade publication) and re-appointed to be his institution’s general manager for a final four-year term in October. Analysts praise him for promoting growth while keeping inflation in check. Meet Colombia’s central bank chief, José Dario Uribe. 

It’s business as usual in Argentina, according to the government: creditors are being paid on time – the government is shelling out $3.5bn in GDP warrants due December 15 in the biggest payment to private sector creditors since its 2001 default, and Argentina has no need of outside financing thank you very much. 

If there were any fears that the EM assets boom seen over the past year – particularly in fixed income – could peter out as valuations get stretched, they have been more or less put to rest by Ben Bernanke’s latest actions. The chairman of the US Federal Reserve on Wednesday announced another round of monetary easing, a move that will add to the flood of hot money that has been making its way to EM assets. 

US-Africa trade received a welcome boost with the signing of the African Growth and Opportunity Act (AGOA) back in May 2000, which enabled African countries to export over 4,000 products, including apparel, quota-free and duty-free to the US. Geared to support the integration of African countries into global markets, AGOA has enjoyed cross-party support in US legislature that is often divided, especially on trade. It has been renewed several times by different presidents. Helping Africa, it seems, is something everyone can agree on.

But they might, unwittingly, have been helping China, too. 

So, after two days of brawling in parliament, Mykola Azarov has been re-instated as prime minister of Ukraine among vociferous and physical protests from a newly-emboldened opposition.

There were shouts of “Shame, shame” on the parliament floor as the brawling engulfed the podium. Shame it was indeed, but the shame will be bigger still if Ukraine fails to get a grip on pressing problems that include negotiating a loan package with what must be an increasingly wary International Monetary Fund. 

IGSS Rosneft oil field SiberiaEnergy-related stocks aren’t just about selling oil and gas – you have to find the stuff in the first place. For investors looking for exposure to the Russian market, IG Seismic Services this week listed global depostitary receipts on the London Stock Exchange. However, it’s also a matter of finding the right price – and someone to trade with.

On launch, things were a little quiet, to say the least – there was no trading on Wednesday. The first trade was on Thursday afternoon for 100 GDRs at $20 – giving the company a guideline market cap of $208m. This is a company with over half the Russian surveying market. So why the lack of investor action? 

A 20 zloty banknote bearing the image of celebrated Polish pianist and composer Frederic ChopinCentral Europe’s slowing economies are driving down their inflation rates – the latest to post figures is Poland, where inflation dropped to an annual 2.8 per cent in November, down from 3.4 per cent in October.

That puts inflation within spitting distance of the central bank’s target rate of 2.5 per cent – the first time that has happened in two years. Inflation in June, when opinions about the economy were a lot more optimistic, was 4.3 per cent. 

If Vijay Mallya pulls this off it will be a moment of magic and/or poor judgement.

Etihad Airways, the Gulf carrier, is on the cusp of buying a stake in the debt-encumbered Kingfisher Airlines – the airline that has been grounded since October. 

2012 has been a year of power struggles in Egypt. Markets have been volatile in sympathy with the political turmoil and, with arguments raging over a new constitution, a $4.8bn IMF loan is on hold. Raza Agha, chief economist for Middle East and Africa at VTB Capital, explains to Rob Minto the risks of extended political uncertainty in Egypt.

Xi JinpingMuch has been made this week of Xi Jinping’s “southern tour”. In retracing the footsteps of Deng Xiaoping, the leader who turned China to markets after Maoism, Xi’s trip to the southern province of Guangdong has been interpreted as the possible beginning of a new push for economic reform.

But Xi’s tour was about more than just the economy. He also spent three days inspecting a military base in Guangzhou, the provincial capital, and made a series of speeches calling for stronger, combat-ready fighting forces. 

* BP back in running for Abu Dhabi contract

* SocGen to sell Egypt unit to Qatar’s QNB for $1.97 billion

* Bumi prefers Bakries’ plan to Rothschild’s

* Shanghai sells most expensive land this year as market recover 

With recession fears spreading across the globe, finding safe investments is becoming trickier by the day. There is one thing, however, that the world’s growing population is certain to spend on, even in times of recession: food.

Ukraine’s budding agribusiness and food companies are well positioned to help feed a hungry world. Among them is London-listed MHP, the country’s largest poultry producer.

“Ukraine today is still known as the breadbasket of Europe, but we hold vast potential to also become the meat basket of Europe by exporting meat and other value-added food products,” says Yuriy Kosyuk, CEO and majority owner of MHP. 

Thursday’s picks from the beyondbrics team: typhoon Bopha is five times worse than hurricane Sandy; the US and China can do more to rein in North Korea; and the islands dispute is taking its toll. Plus: Gujaratis begin speaking out against Modi; US-Russia relations “reset”; and Anglo-American failure to intervene in the Rwandan genocide echos in Congo. 

Despite North Korea’s growing military threat, South Korean investors appear to be full of euphoria as the country’s stock market hit the highest level in two years and a half on strong foreign buying.

The benchmark Kospi stock index closed above the psychologically-important 2,000 level on Thursday, as foreign investors were net buyers for 11 consecutive days, purchasing a net Won2.3tn ($2.1bn) of Korean shares. The index has gained nearly 10 per cent so far this year, driven by Samsung Electronics, which has jumped 45 per cent to a record high of Won1.5m on booming smartphone sales. 

Economic growth of 3 per cent in the eurozone? It sounds like a statistical error at a time when the common currency area is braced for a 0.4 per cent drop. But Estonia is set to record a 3 per cent expansion in 2012, nearly double the government’s forecast at the start of the year. And officials expect another 3 per cent in 2013.

Much of this is a rebound from the extra-severe shock that passed through Estonia and the other two Baltic states of Latvia and Lithuania in 2009 when Estonian GDP dropped by a cumulative 18 per cent.