Another month, another hike: the monetary policy committee of Colombia’s central bank on Friday night voted unanimously to raise the benchmark interest rate a quarter percentage point for the second straight month, to 3.75 per cent. José Dario Uribe, the bank’s chief, told reporters that “the gradual adjustment of the expansive monetary policy reduces the need for abrupt changes in the future and ensures macroeconomic stability”.
By Dalibor Rohac, Cato Institute
Abdel Fattah el-Sisi’s landslide victory in the presidential race, with over 93 per cent of the popular vote, is a result not only of his undeniable popularity among some parts of the Egyptian public, but also of the repression of media and political competition that preceded the election. Following the coup in July 2013, more than 16,000 people have been imprisoned, for crimes that included criticizing the military regime on Twitter.
If el-Sisi’s victory raises doubts about the future of democracy in Egypt, it also leaves unanswered a host of pressing economic concerns. By any account, Egypt’s economy is in a worse shape than before the events of the Arab Spring. The official unemployment rate in the first quarter of 2014 was at 13.4 per cent, up by 0.2 per cent relative to the same period last year. Compared to 2010, the number of unemployed has grown from 2.4m to 3.7m. Some 26 per cent of the population is living under the official poverty line, set at around $1.50 a day.
It’s a good job discipline is an integral part of the Mexican ruling party ethos.
Lawmakers of all shades will need it next month when it comes to debating legislation to implement Mexico’s keynote reform – opening up the energy sector after nearly eight decades under state control: key debates will clash with the World Cup – something opposition lawmakers fought hard to avoid.
Ghana plans to brave into the sovereign bond market before the northern hemisphere’s summer this year, the finance minister, Seth Terkper, told the Financial Times on Friday. The plan comes in spite of a mounting economic crisis in the West African country.
The bond would test the appetite of investors for frontier and emerging countries battling with high fiscal deficits and rapidly rising debt levels at the same time as the US Federal Reserve “tapers” its monetary stimulus.
As the European Central Bank (ECB) teases investors with hints of monetary stimulus measures, expectations of a rate cut are already helping boost appetite for emerging market debt on the continent.
Yields on Hungarian forint bonds dropped yesterday following a heavily oversubscribed bond auction, and since the start of the month Polish and Romanian local currency bonds have also rallied.
As Russia steps up control of the internet, electronic payment processors are feeling the heat. Qiwi and PayPal cited security concerns when they halted co-operation with RosUznik, a Russian charity that supports political prisoners, this week. RosUznik suspects political motives.
Founded in late 2011 as a wave of anti-government protests erupted in Moscow, RosUznik collects charitable donations to help fund legal aid for opposition activists undergoing trial or in detention.
By Javier Blas and Andrew England
Africa attracts monikers from international policymakers – and the odd journalist.
It was the “Hopeless continent” in the late 1990s when economic growth was anaemic and poverty rife. After two decades of lacklustre development, a virtuous circle of economic growth and improved governance – supported by high commodities prices – heralded a new chapter in the mid-2000s, which many have called “Africa Rising”.
Dan Gallucci, Asean Confidential
Whatever progress toward a stable democracy Thailand has lost with the military’s ouster of the elected Puea Thai government, an economic analysis of the country’s latest coup must confront the following facts. First, the Yingluck Shinawatra administration had severely mismanaged the Thai economy even before the political crisis began. Second, the economy has been far more impacted by this turmoil than headline numbers currently reveal.
It will be difficult for any government the junta installs to do worse.
** FT News **
* IMF warns ‘rising’ Africa on debt risks | International Monetary Fund has warned African nations issuing billions of dollars in sovereign bonds they could overload their economies with debt
* Asia bourses end week of solid gains | But despite another high on Wall Street, the mood has turned after fresh data provided mixed signals for Japan’s economy and pointed to deceleration in South Korea
When in 2007, Fifa president Sepp Blatter awarded Brazil the right to host the 2014 World Cup, Brazilians celebrated like they had won the final already.
So why is that – with only 14 days to go before the kick-off at São Paulo’s Itaquerão stadium – people do not seem more animated? Brazilians seem to be moving slower than in the past with their normally effusive efforts to decorate everything in yellow and green, the colours of Brazil’s Seleção, the national team.
Viktor Orbán, the Hungarian prime minister now beginning his second successive term in office, named his cabinet on Thursday with seven out of 10 ministers maintained in a government that is expected to emphasise continuity.
“Out of the 10 ministers named today, seven are the same as in the (previous) Orbán government [so] the prime minister has kept his promise: the government will simply continue what they were before the elections,” Tamás Boros, director of Policy Solutions, a Budapest political think tank often critical of the government, told beyondbrics.
Following Nigeria's example?
The International Monetary Fund’s “Africa Rising” conference opened in Maputo with gushing descriptions about the “potential” and “opportunity” of the fast growing continent.
IMF chief Christine Lagarde, the guest of honour, told the gathering of politicians, aid workers and business types that “we are witnessing a moment of transformation in Africa.” Former US President Bill Clinton joined in via video to talk of Africa’s “remarkable economic progress.”
Yet intertwined with the unabashed bullishness were warnings about the potential potholes that line the road ahead, especially for those nations endowed with rich reserves of the natural resources that have been driving much of the continent’s heady growth.
Some apparently contradictory data from the Institute of International Finance on Thursday: it reckons total net private capital flows to emerging markets have dropped sharply in the first half of 2014, while flows from foreign investors to EM bonds and equities are ticking sharply upwards.
What is going on?
Ivory Coast prime minister Daniel Kablan Duncan expects a sovereign bond planned by his country to come to market in July. He talks to Javier Blas about his financing plans and the challenges facing Africa.
By Gavin Bowring, Asean Confidential
It might seem odd to think of Cambodia as a haven of political stability. Labour unrest in Cambodia’s garment factories turned violent in January this year, while the country’s opposition party, the Cambodia National Rescue Party (CNRP), has boycotted Parliament for six straight months in protest of last year’s “flawed” general elections.
Nevertheless, in the space of a week, Cambodia has seen thousands of Chinese residents in Vietnam fleeing across the border as a result of escalating tension between China and its southern neighbour, Vietnam. Meanwhile, the recent military coup in Thailand led to implicit suggestions by the lawyer of former prime minister Thaksin Shinawatra that Cambodia might be willing to host his “government-in-exile”, though these suggestions have been denied by Cambodian Prime Minister Hun Sen.