Daily Archives: Dec 27, 2012

Vale is wasting no time getting on with its cost reduction plan. As most people were still emerging from a post-Christmas stupor, the Brazilian mining company this week announced another two assets up for the chop. 

Already considered the safest bet for investors in Latin American sovereign debt, the government of Chile received a nod of approval from the ratings agency Standard and Poor’s on Wednesday, as its long-term foreign currency credit rating was notched up to AA-.

This puts the fast-growing Andean nation in some esteemed company – and ahead of all of its regional peers. 

It was bound to happen, it seems. BBVA said earlier this week that it is to sell its Colombian pension fund management business, AFP Horizonte, for about $530m.

The buyer will be no other than the local AFP Porvenir, the retirement business leg of Colombia’s powerful banking group, Grupo Aval. This continues with the trend started last year by one of Grupo Aval’s main competitors, Colombia’s Grupo Sura, which paid $3.6n for the regional assets of Dutch bancassurer ING Groep. 

Alongside the various FT correspondents around the world, beyondbrics plays host to a wide range of guest writers, among whom you’ll find business leaders, academics, market insiders and politicians – and this year, particularly of from Russia.

Which contributions did our readers like the most? Here are the top 10 most read guest posts of 2012. 

 A trader shouts for attention in the crude oil futures pit, 20 August, 2004, on the floor of the New York Mercantile Exchange.

A little less active than this

When it comes to passive or active investing – ie selective stock picks vs index tracking – there’s a big difference between companies based in emerging markets, and their counterparts in developed markets.

You might think that investors in emerging market companies would be in the “pick-and-choose” camp – index tracking is more common in developed markets, surely, and the companies are better known? Actually, it’s the other way round. 

By Ben Aris of bne

Viatchslav Zarenkov must have building in his bones. Once a construction worker himself, Zarenkov founded Etalon Group, Russia’s leading residential developer, 25 years ago in St Petersburg during Perestroika, making him a pioneer of Russia’s private sector. Now it is something of a favourite of investors looking for exposure to Russia’s emerging middle class.

Etalon, which in April 2011 listed on the main board of the London Stock Exchange raising $575m, is the biggest residential developer in the north west of Russia. It concentrated first on Zarenkov’s hometown of St Petersburg, but more recently has moved down to work in the Russian capital. 

Increasing stress in the Egyptian economy was underlined on Thursday as the central bank cancelled a major sale of treasury bills.

The offer was supposed to raise 6bn Egyptian pounds ($969m) through 2bn pounds worth of six month bills and 4bn pounds worth of one year bills, and its cancellation sent the Egyptian pound tumbling to its lowest value since 2004. Add in the a recent ratings downgrade, and it’s a tough December for Egypt. 

An Italian automatic loom produces tapestries with portraits of Russia's Prime Minister Vladimir Putin at the Uzor (Pattern) weaving mill in the town of Vyritsa near the Russia's second city of Saint Petersburg, on February 2, 2012.Russia’s manufacturers are ending the year on a rather downbeat note, according to the latest Purchasing Managers’ Index from HSBC/Markit.

After a year and a bit of plus-50 readings, the number for December was 50.0 – slap bang on the line that separates contraction from expansion. 

* Asian markets extend gains

* S Korea: a dose of economic reality

* China investment products draw complaints

* Philippines Joins Korea in Restraining Currency Gains 

A brighter note to finish 2012 on, in Chinese economic data at least. Industrial profits are up – just – after recovering from a dip earlier in the year.

According to the National Bureau of Statistics, profits from enterprises above the threshold of $3m annual revenues were up 3 per cent in the first 11 months of 2012 from a year earlier, at a total of Rmb4.6tn. For the January-October period, profits had been up only 0.5 per cent. 

Chinese shares extended their strong finish to the year amid hopes that emerging markets would benefit next year from the extension of liquidity and growth boosting measures by the world’s top central banks, writes Neil Dennis.

Thursday’s tinsel from the beyondbrics team: how Ratan Tata set the bar high; pricelings in the ascendancy; fear of China is pushing some Asian countries into closer ties; should Asia pursue its own model of growth? And why Turkey and the EU should step up talks. Plus: a year India would rather forget; and how to democratise Russia without revolution. 

A South Korean banker holds Korean won bank notes at the Korea Exchange bank on December 11, 2012South Korea’s government has finally become realistic about the country’s economic outlook.

The finance ministry on Thursday revised down its growth forecast for this year to 2.1 per cent from its earlier projection of 3.3 per cent and cut that for next year to 3.0 per cent from its September estimate of 4.0 per cent. 

* Asian markets extend gains

* S Korea cuts growth forecasts

* China industrial profit growth quickens

* Argentina bank workers to strike

* China studies cap for local debt

* Chávez hands economy to vice-president

* Markets: up