Country Risk Update March 2014

March 2014

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

Diverging fortunes in the Emerging Markets

The key risks in the emerging markets lies between fundamentals and perceptions as investors try to appraise where medium-term growth prospects remain strong, but also to anticipate where the panic of fellow investors could see indiscriminate capital withdrawals across the board, leading to self-fulfilling over-corrections.

The beginning of the US Federal Reserve’s tapering process has already had a host of effects, some impressively counter-intuitive such as a decline in US government bond yields, to as low as 2.61% for 10-year bonds. The idea in much of 2013 was that tapering would throw to the fore the structural weaknesses of emerging markets in 2014, increasing divergence among emerging markets. However, in January it looked as if even the ‘good reformers’ might suffer from capital flight.

The expectation of some form of discernment beginning to creep back into investor portfolios now seems warranted. Some USD1bn has already entered into Indonesian securities in 2014. Ironically, it may be that the countries with currencies that suffered most in mid-2013, such as the Indian rupee and Indonesian rupiah, have seen the fastest adjustment in balances of payments, and hence could be poised for success in 2014.

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 risks.

WORLD SNAPSHOT

AFRICA

Tunisia: The economy suffers amid the volatile political and security environment.
Uganda: Loss of donor support jeopardizes budget goals and weighs on the currency.

 

MIDDLE EAST

Iran: The outlook improves due to continuing nuclear talks and a willingness to reduce subsidies.
Jordan: The budget will entail further borrowing, raising economic risk.

 

WESTERN EUROPE

Germany: Exports continue to drive growth.
Ireland:  Non-performing loans undermine credit growth but optimism increases.

 

EASTERN EUROPE

Bosnia & Herzegovina: D&B downgrades Bosnia and Herzegovina’s country risk rating amidst violent demonstrations that undermine political and economic stability.
Uzbekistan: Developments in Ukraine raise questions for Uzbekistan’s ethnic Russians.

 

ASIA PACIFIC

Korea (South): Credit risks continue to constrain the recovery.
Taiwan: Mainland China and the island agree to deepen economic ties in their first talks since 1949.

 

AMERICAS

Nicaragua: Strong economic links with Venezuela cast a shadow over prospects.
Venezuela: Demonstrators stage anti-government protests over chronic shortages, crime and inflation.

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.

 

Free Country RiskLine Reports

Select the buttons below to link to details on trading terms, payment delays, exchange rates and economic indicators, plus political, economic and commercial risk analysis.

Colombia

A slimmer government majority could hamper efforts to secure a peace deal with the rebels. Report

Singapore

Manufacturing and financial services should help drive economic expansion in 2014. Report

Vietnam

The economy appears to be losing momentum as exports and imports slow. Report

 


veröffentlicht am: 01. März 2014