Earlier this week, Germany’s Bild newspaper reported that Kazakhstan’s 71-year old president, Nursultan Nazarbayev, had undergone prostate surgery in Hamburg. Given that Nazarbayev has dominated Kazakhstan since the late Soviet era and given the country’s importance to Eurasian energy and geopolitical calculations, any sign that he is ill will certainly increase the country’s risk profile,… [Read more]
In a move that was widely anticipated by the markets, Venezuela officially devalued its currency on January 1 2011, unifying the ‘essential goods’ rate of VEF2.6000/US$ with the ‘non-essential’ VEF4.3000/US$ rate. While the increased supply of dollars in the economy will make it easier to maintain the fixed exchange rate system over the medium term,… [Read more]
Given that President Hugo Chávez’s Partido Socialista Unido de Venezuela (PSUV) lost its two-thirds majority in the September 26 legislative elections, it is pretty likely that the ruling party is going to face a tougher time in passing some of the more radical elements of its socialist reforms. In addition, the 2012 presidential vote is… [Read more]
While my bullish Latin American fixed income views have played out really well of late, other Latin American asset classes have been much harder to call. A case in point has been Brazil’s Bovespa equity index which, despite the rapid sell-off in April and May is trading pretty much where it started the year. I… [Read more]
One of my core Latin American views for some time now has been that political risk will be a key determinant of which countries out- and underperform over the medium term. In this respect, the landslide victory for Juan Manuel Santos in the second round of Colombia’s presidential election on Sunday represents a strong positive… [Read more]
Against an increasingly challenging global economic backdrop, Richard Hamilton, Head of Latin America analysis at Business Monitor International, outlines three core themes for the region. Having been among the first regions to emerge from the global economic downturn in 2009, we take a look at the likely impact of a double-dip in China and an… [Read more]
The decision taken by President Hugo Chávez’s administration to suspend trading in Venezuela’s black market ‘parallel’ rate marks a step closer to Zimbabwe-style hyperinflation and domestic economic ruin. To-date the government has avoided paying the cost of its rampant spending spree and erosion of productive capacity thanks to robust global oil prices, but even without… [Read more]
