GlobalSource Partners | Country Insights

Many an analyst is puzzled that the Central Bank has been holding interest rates constant, while its regional counterparts have started cutting. And the fact that the Bank’s next move next year might be a hike is considered by some to add insult to injury. But we don’t see a puzzle: Colombia is i...

Disengagement proceedings in Ukraine Conflict

RUSSIA / FSU POLITICS · In Brief · 01 Nov 2019

On October 29 the Organization for Security and Co-operation in Europe (OSCE) stated that the Ukrainian soldiers and pro-Moscow rebels had both withdrawn from the front line near Zolote. This one of the steps set out by the peace agreement signed in October. This should lead to a Normandy Format ...

A new fiscal ceiling is approved, the economy stalls and a dangerous Constitutional reform is underway

PANAMA · Report · 01 Nov 2019

The Legislative Assembly approved the revision of the Fiscal Responsibility Law (FRL) on October 28. The proposal approved by the Cabinet was enacted without modifications. Minister Alexander made a technical presentation in which he described the situation of the public finances and the need for...

UAE: Economy likely to overcome weak real estate sector

GULF COUNTRIES · Report · 01 Nov 2019

Weakness in the UAE’s real estate sector is unlikely to spread to the wider economy as government measures and the 2020 World Expo should provide relief and banks are well insulated. A new committee has been formed in Dubai, new property ownership rules have been introduced in Abu Dhabi and th...

Business cycle conditions in Jul-Aug-Sep 2019

INDIA · Report · 01 Nov 2019

The best measure of business cycle conditions in India is the coincident indicator, which is a linear combination of well measured underlying indicators. The coincident indicator deteriorated in Jul-Aug-Sep 2019, to 3.78 per cent below trend. The leading indicator gives us a sense of how the c...

South Africa awaits in trepidation for Moody’s assessment of its credit tonight

SOUTH AFRICA · Report · 01 Nov 2019

Later today Moody’s rating agency is expected to make a pronouncement on South Africa’s sovereign credit rating, and this is after the agency decided to skip publishing the country’s review twice already. The stakes are high given that Moody’s Baa3 rating with a stable outlook is the country’s on...

Naftogaz unbundling, Nord Stream 2 and new gas transit contract

UKRAINE · In Brief · 01 Nov 2019

Yesterday, on October 31, Verkhona Rada completed a critical move for efficient gas transit negotiations with Moscow. Current, 10-years gas transit contract with Gazprom expires in two months. Kremlin has been getting prepared for this day already for many years. Russians have built Nord Stream, ...

Costa Rica: Central Bank cuts its monetary policy rate.

CENTRAL AMERICA · In Brief · 31 Oct 2019

In its October 30th meeting, the Central Bank board cut its monetary policy rate from 3.75% to 3.25%. It is the sixth cut of the rate during this year, taking it from 5.25% as of March 21, 2019 to 3.25%. The decision was justified partially by the slowdown observed in the world economy and the po...

Sberbank trying to buy a stake in a Mail.ru

RUSSIA / FSU POLITICS · In Brief · 31 Oct 2019

On October 29 Sberbank announced that it is trying to buy 20% of Mail.ru Group. If this goes through then Sberbank would be the second largest voting shareholder in the tech company. The largest in Megadon which is owned by the Uzbek-Russian billionaire Alisher Usmanov. Gazprombank owns a 35% sta...

How Chinese banks use their offshore dollars

CHINA ADVISORY · Report · 31 Oct 2019

Chinese banks have a significant amount of USD assets. The top four state banks have close to $1 trillion in USD assets and almost $400 billion in USD investments. These dollar assets are held on the balance sheet of the corporate headquarters in China, in addition to the branch offices in the Un...

Finland's EU budget proposal aims at even less funds on cohesion and agriculture

HUNGARY · In Brief · 31 Oct 2019 · 1 response

The political agreement on the EU's 2021-2027 budget framework still seems far away, but at least the positions taken by the various member governments have become clear by now. On the one hand, some of the big donor countries, led by Germany, would want to keep the budget at no more than 0.97% o...

New deregulation measures expected to boost cross-border trade and investment

CHINA · Report · 31 Oct 2019

The economy is showing various signs of weakening. In Q3, GDP grew at a rate of 6% y/y, down 0.2 pps from Q2, and down 0.5 pps from Q3 2018. Industrial output expanded 5% y/y, down 1 pp from Q3 2018. Investment grew 4.7% y/y, down 0.8 pps from Q2. Retail sales of social consumption goods grew ...

Q4 Inflation Report: Paving the way for further cuts

TURKEY · In Brief · 31 Oct 2019

The CBRT released this year's final Inflation Report today. As expected, the 2019 yearend inflation forecast was revised down to 12% (midpoint of 11.2%-12.8% band) from 13.9%, which is also in line with the New Economy Program forecast released earlier. The 2020 yearend forecast remained unchange...

Excellent moves

INDONESIA · Report · 31 Oct 2019 · 1 response

President Joko Widodo announced the line-up of the Indonesian cabinet for 2019-2024 just a few days after his inauguration as president. His selection of ministers truly reflects his courage and independence. From various angles, this new cabinet can be considered a "dream team" because the chall...

LEBANON: Resignation gambit means new Hariri government is needed to avert a crisis

GULF COUNTRIES · In Brief · 31 Oct 2019

The resignation of the Lebanese PM, Saad al-Hariri, is the political wildcard that we were concerned about in our 22 Oct analysis. However, the most likely scenario is that Hariri will actually remain on as prime minister with the authority to rejig the cabinet slightly, including bringing in som...