Daily Archives: Jan 18, 2013

Huzzah. China’s economy is no longer slowing if fourth quarter GDP figure released on Friday is to be believed.

Q4 year-0n-year growth came in at 7.9 per cent, a hair above market expectations of 7.8 per cent and setting the stage for a good start to this year. However, the numbers tell us little about the durability of the rebound. Nor do they offer much in way of how the recovery will take shape.

On this front, General Electric’s fourth quarter results throw up some interesting insights. Read more

Judging from Thursday’s successful Paraguayan bond sale, bond investors are clearly more desperate to find a good return somewhere – anywhere – then they are interested in constitutional niceties.

Paraguay agreed to sell $500m in bonds at 4.625 per cent, at the bottom of the guidelines of 4.625 per cent to 4.75 percent and far below earlier talk of 5 per cent, Reuters reported. Even more impressively, Paraguay came in under its neighbor Bolivia, which sold $500m in bonds in October at 4.875 per cent. Read more

It doesn’t matter how many cancelled or failed IPOs there have been in Brazil over the past couple of years, there will always be one more company willing to try its luck, it seems.

This time around it is Linx. The technology and software provider for retailers published a prospectus on its website on Friday detailing plans to raise as much as R$528m ($259m) in an initial public offering. Read more

The new year is supposed to bring new things and so it was with Mexico’s central bank, which surprised analysts on Friday by saying that it could cut interest rates in the coming months in a scenario of lower growth and inflation, which it is now suggesting could be the case. Read more

Hungarian Prime Minister Viktor OrbanSay what you will, when it comes to confident – and confidence boosting – speeches, Viktor Orban is up there with the best. Speaking on public radio on Friday, for example, the Hungarian prime minister assured the nation that – as the government website paraphrased him:

“Hungary will begin to ascend in 2013,” and that having done the hard work in the past 30 months, the days of massive legislation efforts “needed for the country’s survival and competitiveness” are largely over and it’s time for growth. Read more

Bill Gates and other US investors have pledged $1bn for a stake in Egypt’s largest listed company in one of the biggest currency inflows into the country since the 2011 uprising.

Orascom Construction Industries said on Friday it had launched an exchange offer on all its outstanding global depositary receipts under a share exchange backed by US investors including Cascade Investment, which is owned by the Microsoft co-founder.

 Read more

One of the more alarming numbers in Turkey is continuing its upward march. In a regular update on Friday, the country’s central bank said that foreign debt coming due over the next 12 months reached, as of the end of November, $143bn. The figure stood at $134bn 12 months before. Read more

Last year’s debate between Paul Krugman, the renowned Nobel-prize-winning American economist, and little Estonia produced plenty of drama.

Now, it’s going to be an opera. Read more

Hugo Chávez was supposed to be sworn in for his third term as Venezuela’s president on January 10 but he hasn’t been seen in public since he went to Cuba for cancer surgery five weeks ago. John Paul Rathbone, the FT’s Latin America editor, and Jonathan Wheatley, deputy emerging markets editor, discuss the implications of this uncertainty for Venezuela and its debt.

Ukraine’s government has provided the first sign that it is willing to further reduce costly – some say unsustainable — subsidies by raising natural gas prices on households.

The unpopular austerity move is a key condition set by the International Monetary Fund for unlocking billion-dollar bailout loans that Ukraine needs to stay afloat this year. Read more

Announcements of new bond issues have been coming thick and fast out of Zambia this year, and the government’s Road Development Agency is the latest to get in on the act.

According to Bloomberg it plans to issue $1.5bn of debt to international investors later this year. Ambitious, certainly – will it work? Read more

Industrial production data out for Poland this Friday surprised even the gloomiest forecasters, showing an annual 10.6 per cent drop in December, the fastest contraction since April 2009 and well below the market consensus of a 6.5 per cent decline.

That has increases the chances of early rate cuts and some analysts worried that Poland may be heading for its first recession in two decades, the longest contraction-free run of any European country. Read more

Adam Maciejewski, the new head of the Warsaw Stock Exchange (pictured), is promising to be a much lower key executive than his predecessor – probably a good thing after Ludwik Sobolewski was fired this week after being accused of trying to solicit funds from listed companies to invest in a movie starring his girlfriend.

Although he has been involved with the WSE since 1994, the quick choice of Maciejewski to replace Sobolewski was a bit of a surprise – though the fact that an insider and not a politician got the job was reassuring for market participants. Read more

By Dmitry Lisenkov of Rusnano

With a long history of scientific breakthroughs, a growing market for high technology and tangible commitment from the government to economic modernisation, Russia is well placed to diversify its economy with high-tech innovation.

International venture capital companies are starting to see the opportunities. I believe that with enough effort from the Russian public and private sectors to leverage the country’s technological and VC resources, the potential of Russia’s innovation can be turned into reality. Read more

China’s GDP may have turned upwards on a quarterly basis, but imbalances in the economy are still a worry. The FT’s Josh Noble talks to Wei Yao, China economist at Société Générale about the outlook for 2013.

While Jakarta struggles with floods this week, its stock market is hitting record highs.

Of course, there is no direct connection between the water washing through the streets and the financial flows in the equity market. Even the links to overall economic growth are fairly remote. But the floods are a painful reminder of the growing pains of emerging markets – pains which can make themselves felt if Indonesian citizens ever decide that the authorities aren’t doing enough to address the country’s many infrastructure gaps. Read more

Investors can be a fickle lot when it comes to Indian IT.

After results earlier in the week from Infosys and Tata Consultancy Services far exceeded expectations, Wipro’s strong profits growth wasn’t enough to stop the shares taking a beating. HCL though, had an easier ride. Read more

Russia lambasted Japan and other countries this week for deliberately weakening their currencies to gain competitive advantage in global trade. Alexei Ulyukayev, the central bank’s first deputy chairman said: “We’re on a threshold of very serious, confrontational actions in the sphere that is known… as currency wars.”

So how come Russia itself is buying dollars to weaken its own currency? Read more

* Chinese growth figures lift shares

* Anger rises over Algerian hostage crisis

* West African troops arrive in Mali to aid French mission Read more

Friday’s picks from the beyondbrics team: investors fret over a debt bubble in CEE; the terrorist attack om the Amenas gas facility comes at the worst possible time for Algeria; an appetite for peace in Turkey; and will clearing up Beijing’s smog come at the expense of growth? Domino’s pizza adapts to life in Delhi; plus, Argentina’s search for an economic model. Read more