Mexico’s Congress should this month pass legislation designed to give the country’s fixed and mobile phone users access to greater competition in a market dominated by Carlos Slim’s Telmex fixed-line company and Telcel mobile network.
Slim’s companies have 80 per cent of Mexico’s fixed-line market and 70 per cent of mobile, so the reform aims to boost consumer choice by giving rivals cheap access to his network in order to catch up – something that naturally has not gone down too well with Slim.
But is this so-called asymmetric regulation a bad thing? Will it boost competition? And will it boost investment? Continue reading »
Manufacturing in central Europe’s leading economies continued to grow in May, with PMIs in Poland, Hungary and the Czech Republic indicating continued expansion, although Poland appeared to show some impact from declining exports to Russia and Ukraine due to the fraught political situation in those two countries. Continue reading »
Andrew Collier, Orient Capital Research
A decade ago, when China was struggling to clean up its banking system, regulators pulled a rabbit out of a hat. They set up a series of “bad banks” – called Asset Management Companies (AMC) – and took Rmb 1.4tn ($125bn) of debt off the hands of the four State Banks in Beijing. It was a big success, leading to the listing of the “Big Four” banks in Hong Kong and a healthier financial system.
Now, they’re trying to pull the same trick again – this time across the country.
Regulators have quietly given approval for local governments to set up their own AMCs. As in Beijing ten years ago, these local AMCs would take non-performing loans (NPLs) from local banks, governments and other financial institutions and sell or restructure them. So far, four Provinces have signed on, but once the experiment gets rolling, it’s likely there will be one for each Province across China. Continue reading »
Tough times ahead for Russian smokers and for the international tobacco groups that feed their obnoxious habit: a ban on smoking in government buildings introduced last year was expanded to include all public places at the weekend, as the Kremlin stepped up the war on Russia’s estimated 40m cigarette addicts. Continue reading »
Source: central bank (click to enlarge)
Market economists have sharply downgraded their outlook for Brazilian growth this year to just 1.5 per cent from an already-anaemic 1.63 per cent, according to a weekly survey of about 100 economists conducted by the central bank. The consensus for 2015 has also fallen, to 1.85 per cent from 1.96 per cent a week earlier. (Our chart is from the central bank report: PIB is GDP; the black line traces the evolution of the outlook for 2014, the red line for 2015.) Continue reading »
By João Carlos Ferraz of the BNDES
The debate about Brazilian development has reached a consensus: investment is the key to a rebound. This is an interesting and very welcome phenomenon as economic analysts very seldom come to similar conclusions. However, when discussing development financing and the contribution of the country’s development bank, the BNDES, this debate has been largely characterised by shallow analysis, with extensive use of expressions with minimum substance, yet very conclusive in defining a negative role for the BNDES in pulling investment upwards. This has resulted in unproductive and even unfair attacks on one of the country’s institutions that has most effectively contributed to Brazil’s development. Continue reading »
** FT News **
* China overtakes Japan as top robot buyer | Rising wage costs and growing competition is forcing the former manual labour ‘workshop of the world’ to turn increasingly to technology
* Fifa faces call to run World Cup vote again | Mohamed Bin Hammam, a former Fifa vice-president, has been accused by Britain’s Sunday Times of making payments totalling $5m to bolster Qatar’s bid Continue reading »
Narendra Modi won a clear majority in India’s recent general elections, relieving him of the trouble of having to head a motley coalition. But the new prime minister does face some other tough balancing acts.
As the beyondbrics team travelled around India during the campaign – from the slums of Mumbai to Modi’s native Gujarat – we found people everywhere complaining at rising prices, with food at the heart of the problem. India’s central bank will make its first interest rate decision under the new government on Tuesday, as the new government seeks to strike the right balance between reining in prices and urging on growth. Continue reading »
** FT News **
* Beijing hits out at US and Japan alliance | Top Chinese general accused US and Japan of staging ‘provocative actions’ against China, as maritime tensions spilled into an Asian regional defence forum
* Nigeria bomb blast kills at least 14 | Militants are still holding more than 200 abducted school girls as Islamist bombings have caused carnage during the past two months Continue reading »