Tanzania’s nuts policy is so bad it’s good 22 Nov 2018 President John Magufuli is shelling out $320 mln to buy all its cashew crop at a hefty premium to help farmers. The government faces a big loss. Failure would at least expose the folly of ham-fisted state intervention, at odds with Africa’s gradual liberalisation.
G20 showdown hangs on big numbers, big egos 21 Nov 2018 Donald Trump and Xi Jinping’s upcoming meeting is weighing on markets. Despite discord among his aides, the U.S. president has the autonomy to strike a deal if China offers the right incentives. His interest in trade balances and historical strongmen creates an opportunity.
Cox: Trump is surprisingly popular – in China 21 Nov 2018 Figures in the PRC’s private sector are discreetly rooting for the U.S. president. Their interests are not served directly by most of his trade demands. But the absence of domestic pressure on Xi Jinping to open markets further makes Trump’s push for reform the only game in town.
Malaysia claim of Goldman cheating is a bit rich 21 Nov 2018 Prime Minister Mahathir Mohamad’s administration says the country was deceived and wants back $600 mln the investment bank made arranging bonds for disgraced 1MDB. Goldman’s compliance was weak, but the last regime knew what it was buying. There’s plenty of blame to go around.
Rates pain compounds UK banks’ Brexit misery 16 Nov 2018 Shares in British lenders fell after government resignations increased the chances of Britain failing to agree a deal with the EU. Investors are pushing back hopes for higher interest rates. That leaves banks stuck with low margins on top of political and economic uncertainty.
Oil forecasting goes from tough to pointless 14 Nov 2018 In recent months crude has hit $86 a barrel, fallen to $65, and is now rising again. Oil prices drive other markets, but predicting them can be a waste of time. Changing demand outlooks, Saudi turmoil and Trump are only the most volatile of a series of uncertainties.
Chinese tourists leave investors holding the bag 14 Nov 2018 Luggage giant Samsonite said mainland sales fell 5 pct last quarter, blaming trade tension and consumer anxiety. Travel website Ctrip is now more cautious, while peer Tongcheng-Elong shrank its IPO. The gloom will globe-trot, including to the planned market debut for Club Med.
Trade war ushers in the compartmentalized economy 8 Nov 2018 Beijing and Washington’s conscious uncoupling could unravel decades-old commercial ties. That doesn’t mean the rest of the world has to choose sides. Companies like electronics maker Philips are mulling how to take advantage of both markets. Business can continue, at a cost.
Trade war leaves mark on U.S. electoral map 7 Nov 2018 The healthy U.S. economy was a helpful running mate for Republicans. But areas like Pennsylvania, hit by duties and retaliatory tariffs arising from Donald Trump’s import levies, were weak spots for his team. It’s a warning for the usual free trade party to remember its roots.
The Exchange: Pascal Lamy 6 Nov 2018 Few people have dedicated their careers to expanding international trade and globalism like Lamy, the former head of the WTO and EU commissioner. But rising rhetoric and increased tariffs between the U.S. and China have him worried, as he tells Rob Cox and Liam Proud in Paris.
South Korea can correct its economic missteps 6 Nov 2018 Business investment has tumbled and hiring weakened following a steep minimum wage hike and cap on working hours. Growth in the $1.5 trln export-dependent economy also is sputtering just as the U.S.-China trade war intensifies. Seoul would be wise to make some small adjustments.
U.S.-China mistrust heightens armed-conflict risk 5 Nov 2018 A near-collision between American and Chinese naval vessels in the South China Sea is a dangerous sign. Both militaries are stepping up readiness. With trade tensions high and the usual back channels dysfunctional, a clash – or worse – is a concern investors should not dismiss.
Xi’s $40 trln trade show talk deserves discounting 5 Nov 2018 China opened a massive expo Monday, telegraphing its appetite for foreign goods. President Xi spoke of $40 trln in imports over 15 years – a seemingly big figure that implies little growth. Given recent talk of “self-reliance”, neither the fair nor Xi’s speech will change minds.
Brazil’s Bolsonaro gives China electric shock 5 Nov 2018 Beijing-backed energy companies hope to invest tens of billions in Brazilian power, but the president-elect has warned of Chinese intentions. Firms like State Grid would bring needed money and expertise, but populist suspicion might overrule commercial logic.
Cox: A dead president is revived for wrong reasons 1 Nov 2018 While midterm U.S. elections may be a referendum on the living president, in one California town the fight is over William McKinley’s legacy. Citizens will vote on removing a statue of the “Napoleon of Protection”. Tragically overlooked in the debate are his faulty economics.
Budget tests mettle of Malaysia’s mavericks 1 Nov 2018 Mahathir Mohamad's government is set to present the $300 bln economy's most significant blueprint in decades. It needs to burnish reform credentials and soothe rating agencies. Outlining a credible tax plan will be a start; a plan to reduce the state's role is the bigger prize.
Trade and pig diseases infect China’s pork giant 31 Oct 2018 WH Group, $11 bln owner of U.S.-based Smithfield, is fighting a losing battle on two fronts. Deadly swine fever is sweeping China, while tariffs hammer its American market. Quarterly earnings fell by almost a third from a year earlier. It will get worse before it gets better.
Wilbur Ross finally picks right fight with China 30 Oct 2018 Washington has put a provincial chipmaker under an embargo similar to that which crippled telecoms giant ZTE. Fujian Jinhua is accused of IP theft by Idaho-based Micron; this retaliation presumes guilt. Still, targeting smaller state-backed firms is smarter than blanket tariffs.
Struggling Filipino deals expose market flaws 29 Oct 2018 Local champion San Miguel was forced to shrink a stock sale while Melco met resistance to its casino takeover plan. Both episodes provide timely reminders about structural shortcomings for an exchange that trades less daily than smaller Vietnam. To grow will require some fixes.
Cox: Saudenfreude over Khashoggi absent from Doha 25 Oct 2018 As Mohammed bin Salman’s blockade of Qatar nears the year and a half mark, it would be easy for the tiny-but-rich Gulf state to gloat over the kingdom’s woes. But chaos across the border is a big worry. A quiet high road is paying off for Qatar. Even MbS seems to agree.