Category: Emerging Markets

SOUTH AFRICA: Is the MTBPS worth the paper it’s written on?

  • Finance Minister Tito Mboweni’s Medium-Term Budget Policy Statement (MTBPS) includes a less “active” stabilization of South Africa’s runaway debt than promised in June.
  • The government now makes even bigger promises on cutting the public-sector wage bill – a good signal but implementation prospects remain uncertain.
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Comment – Default Options

  • The world’s poorer nations are confronted by sharp recessions that threaten to endure.
  • Poverty and inequality are rising rapidly, reversing earlier global income convergence.
  • Public finances are coming under growing duress, and debt distress is mounting.
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NIGERIA: What next for #endSARS?

  • The #endSARS movement will likely retreat to social media for the foreseeable future and forfeit much of its leverage as a result.
  • Past precedent suggests little of substance will emanate from the official commissions of inquiry set up to investigate the armed forces’ human rights abuses.
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MALAYSIA: PM Muhyiddin survives, barely

The United Malays National Organization (UMNO) decided late Monday evening to continue supporting Prime Minister Muhyiddin Yassin. Over the weekend, the prime minister had asked the king to declare a state of emergency, which would have forestalled any attempt to bring down his government, either by the opposition or from within his own coalition.… Read the rest

CHILE: Key takeaways from constitutional referendum

  • A landslide in favor of a new constitution marks the beginning of an intense electoral cycle as well as the two-year constitutional process.
  • The results do not necessarily undermine the mechanism to ensure consensus and moderation in the new constitution.
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BRAZIL: Legislative head, not municipal elections, will move economic agenda

  • Municipal election results in November will not have much influence on the economic agenda.
  • Elections for the presiding officers of both chambers of Congress will delay decisions until February 2021.
  • Only then will it be clear whether government clout or congressional independence will prevail as the driving force of the reform / financial sustainability agenda.
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SOUTH AFRICA: Another plan – heavy on spending, light on liberalization?

  • President Cyril Ramaphosa’s Economic Reconstruction and Recovery Plan makes bold promises around four priority areas – infrastructure development, job creation, energy security and industrialization.
  • It seems heavier on spending than on economic liberalization, which will present challenges for next week’s Medium-Term Budget Policy Statement (MTBPS).
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