Nigeria’s FX reserve fetish is bad for growth 30 Apr 2018 President Muhammadu Buhari is vaunting a rapid rise in foreign exchange reserves. A decent war chest is worth having in case the naira needs defending. But accumulating a vast pile of dollars will deprive the economy of the hard currency it needs to keep growing and create jobs.
Xiaomi puts collective spin on tech IPO vows 25 Apr 2018 The Chinese firm says if net margins on its phones and gadgets ever top 5 pct, users will keep the spoils. Ahead of an IPO at a mooted value of up to $100 bln, this is a stunt worthy of Silicon Valley. It tells investors to focus on apps, and consumers that Xiaomi has their back.
China’s surprise reserve cut exposes growth angst 17 Apr 2018 The central bank cut reserve requirements for banks, freeing $200 bln for lending. That backs up other moves to help over-stretched banks amidst a purge on loose credit. The timing, however, suggests Beijing is looking for a cushion if the economy slows, or a trade war escalates.
Zambia debt dispute undermines African credit 17 Apr 2018 The copper producer has denied it has dollar debt beyond its $8.7 bln of foreign borrowing. Its vague clarification comes two years after a $3 bln bond scandal in neighbouring Mozambique. Bilateral lending, particularly from China, is blurring the credit picture across Africa.
Index inclusion promises Saudi a pre-Aramco bump 29 Mar 2018 FTSE Russell will add the kingdom to global and emerging-markets indexes. MSCI is likely to follow suit, which could steer billions in index funds to the Riyadh exchange. That will make the Saudi market more international even if Aramco’s privatization stays local – or on hold.
Boeing tries market route to competing with Airbus 6 Feb 2018 The $200 bln U.S. giant may buy up to 90 pct of Embraer’s commercial-aircraft business. That would give Boeing effective control while leaving sensitive military hardware in Brazilian hands. It’s a better answer to the Airbus-Bombardier threat than pushing for trade tariffs.
Bill Gates and buyout baron create negative impact 5 Feb 2018 The billionaire’s Gates Foundation is at odds with Abraaj, a buyout group, over a $1 bln fund to provide healthcare in emerging markets. The dispute underscores the tension in combining charitable and financial goals. The fallout will only fuel skepticism of impact investing.
Indonesia can close gap with tiger cub neighbours 23 Nov 2017 Stellar growth in Singapore, Vietnam and elsewhere means Indonesia is the laggard in a booming region. President Joko Widodo could do more to catch up, moving faster to upgrade infrastructure. Reassuring foreign firms by solving an ugly mining dispute would help too.
Asian energy deal defies green resistance 26 Oct 2017 The $5 bln sale of Equis solar and wind projects in Australia, Japan and beyond to a global fund group sets a new benchmark. As clean projects expand, they'll attract oil titans, too. Donald Trump and Malcolm Turnbull may discount renewables, but investors are inflating them.
TPG follows Turkish raki feat with Myanmar whisky 13 Oct 2017 The buyout firm has sold out of Myanmar’s largest spirits company in a $1 bln deal. As it did in Turkey, TPG again bought small, scaled up and sold to a big corporate buyer. Making deals in places like Yangon is an acquired taste – but can yield potent returns.
Charmed life for Indian IPOs may be short 28 Sep 2017 Huge inflows of domestic cash and a lack of healthy financial stocks have helped two insurers float at punchy valuations. At this rate, India is on track for a record year for new issues. But foreigners are selling and the economy looks shaky. Would-be issuers need to move fast.
MSCI gives investors a shot of China’s old economy 21 Jun 2017 The U.S. index provider took the historic step of adding some mainland-listed shares to its global benchmarks. The new entrants include a raft of banks, manufacturers, and raw-materials firms. This will expose foreign investors to sectors challenged by high debt and low growth.
China index inclusion more form than substance 20 Jun 2017 After deciding against it for three years, MSCI will finally add 222 mainland-listed shares to its global benchmarks. This will be a relief for Beijing, which got egg on its face at prior reviews. But the move is largely symbolic and will generate only modest inflows to China.
MSCI’s China plan is clever window dressing 28 Apr 2017 The index provider has slashed the number of mainland stocks to include in benchmarks tracked by $1.6 trln in assets. This should win support after prior failed attempts. But resulting flows into China will amount to a rounding error. It's a very tiny step in the right direction.
Stars align for Vietnam’s privatisation push 20 Mar 2017 Hanoi's desire to tame the budget deficit and boost efficiency bodes well for the sale of state assets, including big brewers. A buoyant stock market helps. But in the rush to secure fat listing valuations, Vietnam risks driving away the foreign buyers it needs.
Vietnam’s banking malady threatens star status 27 Feb 2017 Local lenders need to keep pumping credit into the economy to sustain the country's 6 pct growth. But banks are short of capital. A plan to allow more foreign investment will only help if Vietnam is willing to let outsiders take control of healthier banks as well as weak ones.
HK exchange seeks to shed old-economy dependency 20 Jan 2017 The Hong Kong bourse wants to shed its overdependence on real estate and finance. A proposed new board with lower entry barriers and weighted voting rights may lure hot startup tickers. But getting off the ground fast will be tricky given unresolved issues on the main board.
Emerging market fans get South Africa wake-up call 25 Aug 2016 The rand has slumped since Finance Minister Pravin Gordhan was ordered to report to a special police unit. Falling stocks and bonds are a timely reality check for money managers who have been lured back to emerging markets. An indiscriminate hunt for yield generally ends badly.
China’s factories gain from march of the sew-bots 11 Jul 2016 Millions of jobs across Southeast Asia are at risk from wider use of automation, a new report has warned. The surprising beneficiary might be China. Robots could add to its shrinking workforce, while its network of suppliers and ports are a strength the rest of Asia can’t match.
BRICS inch towards alternative to dollar bloc 27 Mar 2013 Brazil and China will use their own currencies for trade and the five nations are still working on creating a rival to the World Bank. With nearly half the world’s population and 15 pct of its trade - and despite flawed policies - the group is a useful counterweight.