The second cut in China’s interest rates in three months reveals key elements in Beijing’s thinking as it tries to reconcile an economic policy agenda beset with conflicting priorities, analysts said on Monday.
The task before China requires some delicate manoeuvres. It aims to wean the country off an extraordinary debt binge (see Martin Wolf ) while keeping GDP growth fairly robust. It hopes to combat disinflationary pressures while preventing the renminbi from sliding too sharply against the US dollar. It wants to curb a dangerous slump in industrial profits without resorting to another round of investment pump-priming. It needs to keep domestic liquidity levels buoyant in spite of a surge in capital flight. Read more
Mexico’s oil liberalisation is now well under way, with the tender of a second lot of oil assets – nine fields grouped into five blocks – now set to join the 14 that have already been announced. But do the country’s projections for future oil recovery add up?
The government is hoping that private investment in a sector closed for nearly 80 years under the monopoly of state oil company Pemex will succeed in turning around a decade of inexorable decline in Mexico’s oil output. Indeed, it has talked of adding 500,000 barrels per day (bpd) by 2018, when the government’s term is up. Read more
Last week Diezani Alison-Madueke, Nigeria’s oil minister and the president of Opec, called for an extraordinary meeting of the oil exporters’ cartel in the face of falling prices. Rafael Correa, president of Ecuador, Opec’s smallest member, rallied behind her saying prices were “unnecessarily low”.
They may not achieve much – Saudi Arabia and other Gulf exporters are against production cuts – but the calls will nevertheless be welcome in Venezuela, where the sudden collapse of oil prices has been especially bad news. Read more
Another week goes by and the outlook for Brazil’s economy gets gloomier still. The consensus on GDP is now for a 0.58 per cent contraction this year, according to the central bank’s latest weekly survey of market economists, while industrial production is expected to contract by 0.72 per cent. Inflation is expected to rise to 7.47 per cent; the central bank’s policy interest rate is seen ending the year at 13 per cent.
The survey was published on Monday after a weekend that saw yet another apparent rift open up at the top of government, along with some surprising behaviour by President Dilma Rousseff. Read more
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Gulzar Ahmed is one small link in the human bridge between Dharavi, one of India’s largest shanty towns, and the fashion boutiques of Milan.
The master tailor in a small workshop run by Italian designer Viola Parrocchetti, Ahmed is one of thousands of skilled craftsmen that live and work in Dharavi, providing tailoring and embroidering services to India’s thriving fashion industry, much of it destined for export. Read more
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