Country Risk Update January 2017

January 2017

Welcome to the latest issue of D&B’s Country Risk Update.

The policies of the main ‘G3’ central banks continue to diverge. In December, the ECB extended its quantitative easing programme to at least end-2017, although it reduced its asset purchase programme from EUR80bn to EUR60bn monthly. Similarly, the Bank of Japan continued with its easing policies, announcing it would ramp up purchases of bonds maturing in over ten years’ time.

In contrast, the US Federal Reserve took another step towards tightening policy, with only its second interest rate increase of the 2000s. The move had been extensively signalled and priced in by most markets.

However, the markets appeared to have been taken by surprise when the Fed indicated that it would adopt a more aggressive policy towards tightening, with three more rises projected in 2017. The differing policies reflect the divergent paths of economic growth across the globe, with the US economy moving towards full employment and target inflation, while inflation in the euro zone and Japan remains muted. The state rescue and potential nationalisation of Italy’s oldest bank in the last weeks of 2016, after a USD1bn anchor investment from Qatar failed to materialise, showed that Italy’s financial system was still vulnerable: indeed, Italy’s bank stocks lost half their market value in 2016.

This complimentary newsletter from D&B’s Country Insight Services group has been put together by their team of experts using the most up-to-date information to provide a snapshot of the latest macro market risk situation, and provides an excellent overview for those exposed to cross-border credit or investment risks.

WORLD SNAPSHOT

AFRICA

Ghana: President-elect Nana Akufo-Addo pledges to improve growth via development projects and lower taxes.
South Africa: Rival factions of the governing ANC party prepare for more political combat.

MIDDLE EAST

Bahrain: New central bank data shows FX reserves fell sharply in the third quarter of 2016.
Iran: International oil and gas companies ink a plethora of upstream and downstream deals.

WESTERN EUROPE

Germany: An Islamist terror attack in Berlin kills twelve, increasing political pressure on Angela Merkel.
United Kingdom: The invocation of Article 50 moves closer, but the government’s negotiation plan remains unclear.

EASTERN EUROPE

Poland: The ruling party drops its proposal on limiting media access to parliament following demonstrations.
Russian Federation: The US imposes sanctions on Russia over alleged hacking during the US presidential election.

ASIA PACIFIC

Australia: Dun & Bradstreet downgrades its rating outlook for Australia amid broad weakness and a quarterly economic contraction.
China: The central bank further tightens reporting requirements on FX purchases.

AMERICAS

Chile: A new transmission line will stabilise and boost the power network.
Guatemala: Weakness in construction and mining drags down economic activity.

D&B Country Insight Services

D&B’s Country RiskLine reports above are written by a team of highly skilled analysts in D&B’s Country Insight Services team using exclusive data from its global network of reporting offices as well as primary and secondary data from national and international sources.

These snapshot reports provide a succinct assessment of the risk of doing business in a country, given its economic, political and commercial situation.

Updated monthly, the data and analysis are presented in a standard format  which helps you monitor and evaluate the business trading conditions in a foreign country and facilitates the management of ongoing business risk around the globe.

To find out more information click here.

NEW: D&B Country Insight Snapshots

Designed with the help of our customers these reports build on the key areas assessed by ‚D&B’s Country Insight Model‘ and deliver a perfect balance between mitigating risk exposure and providing insight into new opportunities.

India

Dun & Bradstreet downgrades its rating outlook for India due to the demonetisation shock. Report

Mexico

Economic activity accelerates in the third quarter but the near-term outlook remains subdued. Report

Russia

Russia remains in recession but the pace of contraction continues to moderate. Report

veröffentlicht am: 02. Januar 2017