GDP growth. Third-quarter growth could be the slowest since the depths of the global financial crisis, when China reported 6.6 per cent growth in the first quarter of 2009.
Latin America has been one of the great beneficiaries of the commodities supercycle of recent years. With the peak in that boom behind us, what is Latin America to do?
Structural reform, says Alejandro Werner, Western Hemisphere director at the IMF. As he told beyondbrics:
High growth in the last 10 years had a side effect – maybe [Latin America] didn’t push as fast as expected in structural reforms.
Second-guessing Brazil’s central bank has been a little tricky recently. Market volatility and behind-the-scenes political pressure have made interest rate decisions somewhat of a mystery. But economists and traders are relatively confident of a 50 basis point interest rate hike later on Wednesday, it seems. Read more
Rarely has a forecast been cut so fast. The European Bank for Reconstruction and Development on Friday slashed its 2013 growth forecast for the emerging economies of central and eastern Europe and North Africa from 3.1 per cent in January to just 2.2 per cent.
While the effects of the eurozone crisis have abated, economic activity is slowing faster than expected in the region’s biggest two markets – Russia and Poland. Structural reforms are needed, and needed now, says the bank. But it always says that. Read more
Recent editions of the IMF’s World Economic Outlook have made pretty gloomy reading for developed economies, with growth forecasts trimmed and few recovery prospects.
But despite the global headwinds, emerging markets are still getting a positive writeup from the Fund’s economists. Here are the charts that tell the story. Read more
Colombia sure likes to keep the markets on their toes.
On Friday, the country cut its benchmark interest rate for the fifth consecutive month. While previous cuts came in at 25bps increments, the central bank took out the axe this time around and chop rates by 50bps to 3.25 per cent – the lowest in Latin America. Read more
Colombia is recovering… by baby steps.
The Andean nation’s gross domestic product grew 4 per cent last year, beating the country’s central bank forecast of 3.3 to 3.9 per cent – but still much lower than the 6.6 per cent of 2011. Read more
Critics of lotteries the world over often describe them as taxes on the poor, and for good reason. From the US to Spain, lower-income citizens are the biggest buyers of lottery tickets, and, as a group, they will lose at least 35 per cent of what they spend.
In China, though, it is more accurate to describe the lottery as a tax on hope. Those buying tickets tend to earn more than average, but they have run into the chasm that is China’s wealth gap and see the lottery as their best bridge across it. Read more
Sentiment is everything in the Gulf. Without reliable or regular economic data, it is a struggle to know which direction the wind is blowing.
The underdevelopment and lack of disclosure of public statistics explains in part why so few saw Dubai’s 2009 debt crisis coming. And now, as some Gulf economies appear to be pulling out of the economic crisis, there are still few concrete numbers to prove it. Many are relying on improved sentiment…on anecdotes here and there. Read more
South Korea’s central bank on Friday held the base interest rate at 2.75 per cent for the third successive month, after signs that the national economy is picking up after a subdued performance last year. But it voiced unease about the European fiscal crisis, as it trimmed its growth forecast for 2013. Read more
After last month’s slap in the face when Brazil released shocking GDP data at only 0.6 per cent, Colombia followed suit on Thursday announcing surprisingly weak third-quarter growth. The Andean country’s economy grew just 2.1 per cent in the third quarter compared with the same period last year.
The drag was caused by an acute slowdown in the construction sector as well as sluggish manufacturing. The growth pace was not only much slower than the 7.5 per cent expansion in the same quarter last year, but it was also the weakest in three years. Read more
It seems in every family there are secrets and lies.
On Wednesday afternoon, Pedro Delgado, the cousin of Ecuador’s President Rafael Correa, and the Andean country’s central bank president, stepped down after confessing that he did not hold a university degree in economics.
“I submit my irrevocable resignation as head of the central bank… and I do it because I made a grave mistake 22 years ago,” Delgado said. Read more
Western Europe tends not to look to eastern Europe for lessons in economic management, but in these straitened times it makes sense to consider the big differences in the impact of the global crisis on four countries that are often lumped together – Poland, the Czech Republic, Slovakia and Hungary. Read more
The world economy is doing worse than expected only three months ago says the International Monetary Fund in its latest review – a judgement that will surprise nobody following global economic events.
The euro crisis has not receded in line with the IMF’s projections, upsetting growth forecasts and leaving significant risks hanging over the world economy. Meanwhile, even the emerging economies, the engine of global growth, aren’t doing as well as had been predicted – partly because of domestic constraints and mounting financial imbalances. All in all, not a pretty picture, even when viewed from São Paulo or Beijing, let alone Brussels or Madrid. Read more
Less than twenty years since the end of the war that destroyed its reputation as a safe and easy-going destination, Croatia is celebrating its best-ever tourist season.
Officials are now confident that 2012 will be a record year, with some 9.82m visitors arriving in the first eight months of the year – including the July-August peak season. That’s 4.22 per cent up on the same period last year, according to tourism minister Veljko Ostojic. Overnight stays by tourists rose 5 per cent to 59m. Read more