Brazil, China, Commodities, Corporate Finance, Economics, Emerging Markets, Emerging markets, global economy, IMF, International Trade, Latin America, Long term finance, Shadow Banking, Uncategorized, World Bank

Articles 2017 by Otaviano Canuto

Articles 2017 (Otaviano Canuto)

 

I – Global Economy

 

China and the new phase of trade expansion, OMFIF, Huffington Post, INTERFIMA, Seeking Alpha, December 2017

Two globalization processes will evolve in parallel, and might even reinforce each other. Much will depend on the extent to which anti-globalization sentiment rises or falls in key markets. Progress on trade deals like the new TPP and the wide reach of the Belt and Road should engender some confidence that international economic cooperation has not reached a nadir under President Trump – but can strike out in new and positive directions.

 

Overlapping Globalizations, Huffington Post, INTERFIMA, Seeking Alpha, November 2017

Current technological developments in manufacturing are likely to lead to a partial reversal of the wave of fragmentation and global value chains that was at the core of the rise of North-South trade from 1990 onward. At the same time, China – the main hub of the global-growth-cum-structural-change of that period – may attempt to extend the previous wave through its “One Belt, One Road” initiative.

 

The Metamorphosis of Financial Globalization Capital Finance International, Huffington Post, INTERFIMA, Seeking Alpha, OCP Policy Center, autumn 2017

After a strong rising tide starting in the 1990s, financial globalisation seems to have reached a plateau since the global financial crisis. However, that apparent stability has taken place along a deep reshaping of cross-border financial flows, featuring de-banking and an increasing weight of non-banking financial cross-border transactions. Sources of potential instability and long-term funding challenges have morphed accordingly.

 

Bloated central bank balance sheets  Capital Finance International, Huffington Post, INTERFIMA, Seeking Alpha, OCP Policy Center, spring 2017 (w/ Matheus Cavallari)

Central banks of large advanced and many emerging market economies have recently gone through a period of extraordinary expansion of balance sheets and are all now possibly facing a transition to less abnormal times. However, the fact that one group is comprised by global reserve issuers and the other by bystanders receiving impacts of the former’s policies carries substantively different implications. Furthermore, using Brazil and the U.S. as examples, we also illustrate how the relationships between central bank and public sector balance sheets have acquired higher levels of complexity, risks and opacity. (.pdf version here from OCPPC)

 

Global Imbalances on the Rise  Capital Finance International, winter 2017

Signs of a possible resurgence of rising global current-account imbalances have returned attention to the issue. We argue here that, while not a threat to global financial stability, the resurgence of these imbalances reveals a sub-par performance of the global economy in terms of foregone product and employment, i.e. a post-crisis global economic recovery below its potential. In addition, we approach how the re-orientation of the US economic policy already announced by president Trump suggests risks of new bouts of tension around global current account imbalances.

 

NAFTA at the Crossroads  Huffington Post, INTERFIMA, Seeking Alpha, OCP Policy Center, May (w/ Michael McKeon and Samuel George)

The U.S. Senate voted to confirm Robert Lighthizer as United States Trade Representative last week, rounding out President Donald Trump’s cabinet and giving momentum to his trade agenda. At his swearing-in ceremony on May 15, Ambassador Lighthizer predicted that President Trump would permanently reverse “the dangerous trajectory of American trade,” and in turn make “U.S. farmers, ranchers and workers richer and the country safer.” This policy shift will begin in earnest in the coming weeks, when Lighthizer meets with congressional trade leaders to discuss the administration’s plan to renegotiate the North American Free Trade Agreement (NAFTA).

 

II – Infrastructure Finance

 

Bridging Finance and Infrastructure, Cornell on Emerging Markets, December 1, 2017 (w/ Aleksandra Liaplina)

A bridge between private sector finance and infrastructure can be built if properly structured projects are developed, with risks and returns distributed in accordance with different incentives of stakeholders.

 

Filling the infrastructure financing gap,  OMFIF, Huffington Post, INTERFIMA, Seeking Alpha, December 2017

Infrastructure investment has fallen short of what is needed to support potential growth. At the same time, financial resources in world markets have contended with low long-term interest rates, while opportunities for greater returns from potential infrastructure assets are missed.

 

Matchmaking Finance and Infrastructure  Capital Finance International, Huffington Post, INTERFIMA, Seeking Alpha, OCP Policy Center summer 2017 (w/ Aleksandra Liaplina)

The world economy – and emerging market and developing economies in particular – display a gap between their infrastructure needs and the available finance. On the one hand, infrastructure investment has fallen far short from of what would be required to support potential growth. On the other, abundant financial resources in world markets have been facing very low and decreasing interest rates, whereas opportunities of higher return from potential infrastructure assets are missed. We approach here how a better match between private sector finance and infrastructure can be obtained if properly structured projects are developed, with risks and returns distributed in accordance with different incentives of stakeholders. (.pdf version here from OCPPC)

 

III – Brazil

 

Brazil’s Economic Deliverance Project Syndicate, September 28

Brazil’s proliferating corruption scandals have imposed substantial costs on some of the country’s largest companies. But, in the long term, today’s efforts to strengthen the rule of law and ensure fair market competition will prove to have been well worth it.

 

Dissolving corruption in Brazil  OMFIF, Huffington Post, INTERFIMA, Seeking Alpha, October  

The prevalence of crony relationships between public and private agents is neither new to Brazil nor singular to the country. The dissolution of this framework, even if painful in the short term, has great potential to create economic, political, and social gains in Brazil, and may provide an example for other countries around the world.

 

Does Brazil’s Sector Structure Explain Its Productivity Anemia?   Huffington Post, INTERFIMA, Seeking Alpha, OCP Policy Center, June (w/ Fernanda De Negri)

Brazil’s labor and total-factor productivity (TFP) have featured anemic increases in the last decades. As we illustrate here, contrary to common view, sector structures of the Brazilian GDP and employment cannot be singled out as major determinants of productivity performance. Horizontal, cross-sector factors hampering productivity increases seem to carry more weight.

 

Long-term finance and BNDES tapering in Brazil  Huffington Post, INTERFIMA, Seeking Alpha, OCP Policy Center, June (w/ Matheus Cavallari)

One major policy issue in Brazil is how to boost productivity, while following a path of fiscal consolidation that will take at least a decade to bring the public-debt-to-GDP ratio back to 2000 levels. The productivity-boosting agenda includes not only the implementation of a full range of structural reforms, but also recovering and upgrading the national infrastructure and other long-term investments. Given that fiscal consolidation has already been leading to less transfer of funds—in fact, the reversal—from the Treasury to the National Economic and Social Development Bank (BNDES) and a consequent downsizing of the latter’s operations, pursuing the double objective of raising productivity and adjusting fiscal accounts will require an expansion of alternative sources of long-term asset finance.

 

Brazil’s Pension Reform Proposal is Necessary and Socially Balanced  Huffington Post, INTERFIMA, Seeking Alpha, OCP Policy Center, April

Last week the World Bank released a Staff Note analyzing the pension reform proposal sent last December by Brazil’s Federal Government to Congress. It concludes that:  “… the proposed pension reform in Brazil is necessary, urgent if Brazil is to meet its spending rule, and socially balanced in that the proposal mostly eliminates subsidies received under the current rules by formal sector workers and civil servants who belong to the top 60 percent of households by income distribution.” With the help of some charts extracted from the note, we summarize here some of the reasons for such a statement.

 

The Brazilian debt hangover  Huffington Post, INTERFIMA, Seeking Alpha, OCP Policy Center, January

With the help of five charts, we approach the Brazilian credit cycle, the downward phase of which helps understand why the post-crisis recovery has been so hard to obtain. In our view, the profile of such a credit cycle in effect points to it as a special chapter of our previously approached determinants of the Brazilian economic crisis.

 

The Brazilian productivity anemia  Cornell on Emerging Markets, April 2017

Brazil has been suffering from “anemic productivity growth”. This is a major challenge because in the long run, sustained productivity increases are necessary to underpin inclusive economic growth. Without them, increases in real labor earnings tend to conflict with global competitiveness; collecting taxes in order to fund government expenditures on infrastructure and social policies becomes a heavy burden; returns to private investment becomes harder to achieve; and ultimately citizens will have less access to high-quality goods and services at affordable prices. The focus on urgent fiscal reforms adopted by the new government– public spending cap, social security reform – must be accompanied by action on the productivity front.

 

IV – Emerging Markets

 

Beyond the Ballot: Turkey’s Economy at the Crossroads  Huffington Post, INTERFIMA, Seeking Alpha, OCP Policy Center, March 2017 (w/ Sam George)

In the current environment, Erdogan is no longer striving to prove Turkey is ready for the EU and many believe that this course has rendered Turkish accession extremely unlikely, at least in the near term. From a purely economic standpoint, a political falling out would be a shame. The European Union is the most important trading partner for Turkey, and 40 percent of Turkey’s exports are destined for European countries. Turkey has increasingly become a part of European production chains for manufacturing as well. If political ties are not deepened, these economic links may not reach their full potential. In the meantime Turkey’s economy continues to grow, and the country maintains its momentum. But as Turks prepare to take to the polls to address a political crossroads, they must not lose track of the economic crossroads bearing down on them from beyond the bend.

 

Colombia: getting growth, getting peace  Huffington Post, INTERFIMA, Seeking Alpha, OCP Policy Center, March 2017 (w/ Diana Quintero)

The Santos administration has delivered on two of its main promises: sign a peace agreement with the FARC guerrilla and get approved a significant structural tax reform. We approach here why both are expected to become strong pillars to help keep the growth-cum-poverty-reduction momentum of the last decades.

 

Cuba Online  Huffington Post, INTERFIMA, Seeking Alpha, OCP Policy Center, August 2017 (with Sam George)

Dual transitions are under way in Cuba. The island is slowly opening its economy, and a new crop of younger political leaders, potentially more open to democratic norms, waits in the wings. A third transition, the rise of digital access, is also in an early stage. But it is this third transition that arguably has the most momentum and could significantly accelerate the first two.

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Brazil, China, Commodities, Corporate Finance, Economics, Emerging Markets, Emerging markets, global economy, IMF, International Trade, Latin America, Long term finance, Shadow Banking, Small States, Uncategorized, World Bank

Four Lectures on Emerging Markets and the Global Economy

Four Lectures on Emerging Markets and the Global Economy

Otaviano Canuto, Casablanca, 15-18 January 2017

 

  1. Asset Accumulation and Growth in Developing Economies
  • Behind our “measured ignorance”
  • Natural Capital and the Resource Curse
  • Poverty- and Middle-Income Traps
  • Innovation, Capabilities and Intangible Wealth
  • Investment Climate and Infrastructure
  • Income and Efficiency Gaps

 

Canuto, O. and Cavallari, M. “Natural Capital and the Resource Curse“, Economic Premise No. 83. World Bank. Washington D.C. May 2012.

Brahmbhatt, M.; Canuto, O. and Vostroknutova, E. “Natural Resources and Development Strategy after the Crisis”, in Canuto, O. and Giugale, M. (eds.) The Day after Tomorrow: A Handbook on the Future of Economic Policy in the Developing World, World Bank, Washington D.C, 2010.

Agenor, P-R.; Canuto, O. and Jelenic, M. “Avoiding middle income growth traps”, Economic Premise No. 98. World Bank. Washington D.C. November 2012.

Agenor, P-R.; Canuto, O. and Jelenic, M. “Access to Finance, Product Innovation, and Middle-Income Growth Traps”, Economic Premise No. 137. World Bank. Washington D.C. March 2014.

Canuto, O.; Dutz, M. and Reis, J.G. “Technological learning: climbing a tall ladder”, in Canuto, O. and Giugale, M. (eds.) The Day after Tomorrow: A Handbook on the Future of Economic Policy in the Developing World, World Bank, Washington D.C, 2010.

Cirera, X. and Maloney, W. F. “The innovation paradox: Developing-Country Capabilities and the unrealized promise of technological catch up”, World Bank, Washington D.C., 2017 (Executive summary and ch.1)

World Bank, “A better Investment climate for everyone”, World Development Report 2005, World Bank, Washington D.C. 2004

Araujo, J.T., Vostroknutova, E., and Wacker, K.M. “Understanding the Income and Efficiency Gap in Latin America and the Caribbean“, World Bank, 2016

 

  1. Trade Globalization and Industrialization
  • Globalization and “The Great Convergence”
  • China: from the Great Transformation to Rebalancing
  • What Happened to World Trade
  • The Future of Manufacturing-Led Development
  • Premature Deindustrialization
  • China’s Rebalancing and Sub-Saharan Africa
  • Middle East and North Africa needs reforms

 

Baldwin, R. “The Great Convergence: Information Technology and the New Globalization”, The Belknap Press of Harvard University Press, Cambridge, Mass., 2016.

Hallward-Driemeier, M. and Nayyar, G. “Trouble in the Making? : The Future of Manufacturing-Led Development”, World Bank, Washington D.C., 2017

WIPO – World Intellectual Property Right Organization, World Intellectual Property Report 2017 – Intangible Capital in Global Value Chains, Geneva, 2017 (Executive Summary and ch.1)

Canuto, O. “What happened to world trade?”, OCP Policy Brief PB-16/15, June 2016.

Dadush, U. “Is Manufacturing Still a Key to Growth?”, OCP Policy Paper PP-15/07,

Canuto, O. “Overlapping globalizations”, OCP Policy Brief PB-17/ , November 2017.

Canuto, O.  “China, Brazil: Two Tales of a Growth Slowdown”, Capital Finance International, summer 2013.

Chen, W. and Nord, R. (2017). “A Rebalancing Act for China and Africa: The Effects of China’s Rebalancing on Sub-Saharan Africa’s Trade and Growth”, IMF African Department Paper Series.

Lakatos, C. et al. (2016). “China’s Slowdown and Rebalancing: Potential Growth and Poverty Impacts on Sub-Saharan Africa”, World Bank, Policy Research Working Paper 7666, May 2016.

Azour, J. (2017). “A time for action”, Finance & Development, December, Vol. 54, n. 4.

Arezki, R. (2017). “Getting There”, Finance & Development, December, Vol. 54, n. 4.

 

  1. Financial Globalization and Emerging Markets
  • The Metamorphosis of Financial Globalization
  • Unbalanced Growth in the Global Economy
  • Macroeconomic Policies in Advanced Economies After the Global Financial Crisis
  • Capital Flows to Emerging Markets
  • Global Debt
  • China’s Great Leverage
  • Finance and Infrastructure

 

Canuto, O. “Macroeconomics and Stagnation – Keynesian-Schumpeterian Wars”, Capital Finance International, May 2014.
Canuto, O. and Cavallari, M. “The mist of central bank balance sheets”, OCP Policy Brief PB-17/07, February 2017

Canuto, O. “The Metamorphosis of Financial Globalization”, Capital Finance International, Autumn 2017

Canuto, O. Global Imbalances on the Rise  Capital Finance International, winter 2017

Canuto, O. and Gevorkyan, A. “Capital Flows and Deleveraging in Emerging Markets: the Great Portfolio Rebalancing”, Huffington Post, 2016

Canuto, O. and Gevorkyan, A. “Tales of emerging markets”, EconoMonitor, August 8, 2016

Hannan, S.A., The Drivers of Capital Flows in Emerging Markets Post Global Financial Crisis, IMF Working Paper WP/17/52, February 2017.

Canuto, O., “Whither Emerging Markets Foreign Exchange Reserves” Capital Finance International, winter 2015-2016.

Canuto, O. and Liaplina, A. Matchmaking Finance and Infrastructure  OCP Policy Brief PB-17/23, June 2017

Canuto, O. “China’s Spill-Overs on Latin America and the Caribbean”Capital Finance International, summer 2016.

IMF, 2017 External Sector Report, July 28, 2017

IMF, People’s Republic of China – Financial Sector Stability Assessment, December 2017

Canuto, O. and Zhuang, L. “Shadow Banking in China: A Morphing Target”, Huffington Post, 2015.

 

  1. Macroeconomic Policies in Emerging Markets
  • Fiscal Policy for Growth and Development
  • Macro-Financial Linkages in Emerging Markets
  • Monetary Policy and Macroprudential Regulation
  • Macroeconomics and Sovereign risk Ratings

 

Brahmbhatt, M. and Canuto, O. “Fiscal Policy for Growth and Development“, Economic Premise No. 91. World Bank. Washington D.C. October 2012.

IMF “Tackling Inequality”, ch. 1 of IMF Fiscal Monitor: Tackling Inequality, October 2017.

IMF, “IMF Fiscal Monitor: Achieving More with Less”, April 2017

Canuto, O. and Ghosh, S., “Overview”, in Canuto, O. and Ghosh, S., (eds.), Dealing with the Challenges of Macro Financial Linkages in Emerging Markets, World Bank, 2013.

Canuto, O. and Cavallari, M. “Monetary Policy and Macroprudential Regulation: Whither Emerging Markets“, in Canuto, O. and Ghosh, S., (eds.), Dealing with the Challenges of Macro Financial Linkages in Emerging Markets, World Bank, 2013.

Canuto, O. “How Complementary Are Prudential Regulation and Monetary Policy?“, Economic Premise No. 60. World Bank. Washington D.C. June 2011

Canuto, O.;  Mohapatra, S. and Ratha, D. “Shadow Sovereign Ratings“, Economic Premise No. 63. World Bank. Washington D.C. August 2011.

Canuto, O.; Santos, P.F. and Porto, P.C.S., “Macroeconomics and Sovereign Risk Ratings“, Journal of International Commerce, Economics and Policy, Vol. 3, No. 2. May 2012.

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Brazil, China, Commodities, Corporate Finance, Economics, Emerging Markets, Emerging markets, global economy, International Trade, Latin America, Long term finance, Shadow Banking, Uncategorized

2016 Retrospect – with links

 

2016

Global Macro-Economy

Financial markets seem to believe that president-elect Trump can deliver higher growth and inflation, as manifested in the rotation from bonds to equities. At the same time, the shock waves already felt by assets abroad may be a harbinger of the bumpy and treacherous journey ahead. No wonder Mr. Trump’s softening of statements — and campaign promises — after the election has been taken with sighs of relief.

Discussions around large current account imbalances among systemically relevant economies as a threat to the stability of the global economy faded out in the aftermath of the global financial crisis. More recently, some signs of a possible resurgence of rising imbalances have brought back attention to the issue. We argue here that, while not a threat to global financial stability, the resurgence of these imbalances reveals a sub-par performance of the global economy in terms of foregone product and employment.

Huffington Post, Roubini EconoMonitor (with Aleksandr V. Gevorkyan)

Capital outflows from emerging market economies have substantially accelerated since last year. The cycle of intense debt leveraging that took place in those economies after the 2008 global financial crisis has also started to reverse. Furthermore, 2015 was also a fifth consecutive year of growth deceleration in emerging markets. Some analysts have taken those features as pointing to a high likelihood of a “third wave” of the global financial crisis, this time centered on emerging markets. While arguably their combination may acquire a disorderly nature and materialize systemic risks to those economies as a group – and therefore to the global economy going forward – there are also reasons to expect the significant portfolio rebalancing at play not to lead to a disruptive break.

After a exponential rise in foreign exchange reserves accumulation by emerging markets from 2000 onwards, the tide seems to have turned south since mid-2014. Changes in capital flows and commodity prices have been major factors behind the inflection, with the new direction expected to remain, given the context of the global economy going forward. Although it is too early to gauge whether the on-going relative unwinding of such reserves defenses will lead to vulnerability in specific emerging markets, the payoff from strengthening domestic policies has broadly increased.

 

Global Trade

Prospects for growth in global trade in 2016 and 2017 have been downgraded again. The World Trade Organization (WTO) now expects that trade this year will increase at its slowest pace since the post-2008 global recession. What is going on?

World trade suffered another disappointing year in 2015, experiencing a contraction in merchandise trade volumes during the first half and only a low recovery during the second half (Figure 1). While last year’s trade performance can be associated to the ongoing growth transition in China and its reflections on other non-advanced economies, the fact is that last year’s performance came after a period since the 2000s in which world trade volumes have lagged behind GDP growth, a trend accentuated since the onset of the global financial crisis and in sharp contrast to global trade increases at a higher pace than world GDP prior to the new millennium.

For better or worse, TPP and TTIP could redefine global trade in the 21st century. At the moment, a Latin America perspective is largely lacking in the negotiation process; in TTIP, it is excluded by definition. But Latin American countries can move unilaterally to ensure that tariffs and regulations match what could become the new global standard. Of course, alternatively, they could rebuild protective economic walls. But if they do, later on down the road, they just might have to pay for it.

Trade has been a key driver of global growth, income convergence, and poverty reduction. Both developing countries and emerging market economies have benefited from opportunities to transfer technology from abroad and to undergo domestic structural transformation via trade integration in the last decades. Yet, more recently, concerns have been raised over whether the current pace and direction of world trade lead towards a lesser development-boosting potential.

Brazil

In recent years Brazil has experienced significant depreciation of its nominal exchange rate. Compared with its average in 2013, the Brazilian real lost 38 per cent of its value against the US dollar in 2016. At its weakest, in January 2016, it lost as much as 47 per cent. A year ago, we saw that depreciation as a silver liningfor Brazil amid its deep recession, as a source of support for exports. But Brazil’s recent GDP data (particularly for the second quarter of 2016) show a negative contribution of net exports to growth.

Brazil’s GDP is poised to decline by close to 7% in 2015-2016. Per capita GDP in 2016 is likely to shrink by more than 10% as compared to three years ago. We argue here that a double malaise has been ailing the Brazilian economy: given an anaemia of productivity increases, an appetite for public spending without prioritisation has led to a condition of fiscal obesity. We further approach why market reactions to the Brazilian government’s proposal of crisis response have been positive.

Now that impeached Brazilian President Dilma Rousseff is out of office, it is up to the newly empowered administration of President Michel Temer to clean up Brazil’s macroeconomic mess. Can Temer’s government save Brazil’s crumbling economy?

Brazil has been suffering from anemic productivity growth. This is a major challenge because in the long run, sustained productivity increases are necessary to underpin inclusive economic growth. Without them, increases in real labor earnings tend to conflict with global competitiveness; collecting taxes in order to fund government expenditures on infrastructure and social policies becomes a heavy burden; returns to private investment becomes harder to achieve; and ultimately citizens will have less access to high-quality goods and services at affordable prices. The focus on urgent fiscal reforms adopted by the new government- public spending cap, social security reform – must be accompanied by action on the productivity front.

Brazil’s GDP contraction since mid-2014 has multiple non-fiscal roots – Canuto (2016a; 2014) – but it has morphed into an unsustainable fiscal trajectory (Canuto, 2016b). Dealing with the latter has become a precondition for full economic recovery and the Brazilian government has submitted to Congress a constitutional amendment bill mandating a public spending cap for the next 20 years. This piece considers how the Brazilian landscape evolved toward such a precipice and why additional reforms – particularly on pensions – will have to be implemented to make the spending cap feasible.

With the impeachment of President Dilma Roussseff being sent to the Senate on April 17, Brazil continues a period of turmoil that has lasted for more than a year now. With images of protests, counter-protests and the minutia of the country’s legal proceedings blasted by media outlets around the world, it seems important to take a step back and remember that a lot more lies beyond the headlines.

Emerging Markets

This collection empirically and conceptually advances our understanding of the intricacies of emerging markets’ financial and macroeconomic development in the post-2008 crisis context. Covering a vast geography and a broad range of economic viewpoints, this study serves as an informed guide in the unchartered waters of fundamental uncertainty as it has been redefined in the post-crisis period. Contributors to the collection go beyond risks-opportunities analyses, looking deeper into the nuanced interpretations of data and economic categories as interplay of developing world characteristics in the context of redefined fundamental uncertainty. Those concerns relate to the issues of small country finance, the industrialization of the developing world, the role of commodity cycles in the global economy, sovereign debt, speculative financial flows and currency pressures, and connections between financial markets and real markets. Compact and comprehensive, this collection offers unique perspectives into contemporary issues of financial deepening and real macroeconomic development in small developing economies that rarely surface in the larger policy and development debates.

The Chinese economy is rebalancing while softening its growth pace. China’s spillovers on the global economy have operated through trade, commodity prices, and financial channels. The global reach of the effects from China’s transition have recently been illustrated in risk scenarios simulated for Latin American and the Caribbean economies.

A propensity to undergo periodic episodes of instability and volatility of emerging markets in global finance will persist. Get ready for a continuous dispute between the two financial tales about emerging markets, as well as to increasing efforts of differentiation among their assets.

Turkey’s economy is at a crossroads, and how the country emerges from the current period of political crisis could dictate its ability to meet its challenges. Will power consolidation and purges render a compromised central bank? Will truculence with major partners such as the EU and Russia lead to deceleration in real-sector growth? Will human rights abuses and risk aversion lead investors to steer clear of Istanbul? And how will a population on edge react to what many expect to be a miserable summer in tourism receipts?

Suriname is facing twin – external and fiscal – deficits that originated in the commodity price slump of recent years. In response, the Surinamese government started a four-pronged adjustment program in August 2015 to adapt to new circumstances.

 

 

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