What Our Analysts Are Reading – 11/3/2017

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Each week Frontier Strategy Group’s global team shares their view on key media stories, and what the implications are for businesses that operate in emerging markets. For more information about how to contact our analysts, send us an email.


Alejandro Valerio on “Ecuador’s president, Lenín Moreno, ousted from ruling party, Alianza País (AP), presidency”

“The rift between Ecuador’s president, Lenín Moreno, and former president, Rafael Correa, seems to have crossed the point of no return. Yesterday, Moreno was ousted from the presidency of AP. The division represents a hurdle that Moreno must cope with in order to approve the economic reforms in Congress he announced to correct the macroeconomic imbalances that impede Ecuador’s economic growth.”

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Danyi YangDanyi Yang on “China rows back on South Korea economic blockade”

“After railing against Seoul for a year since the deployment of THAAD, China has released signals to settle the dispute. While companies are expected to see Sino-Korean economic ties gradually resume, China’s change of stance poses new uncertainty for President Trump’s plans to align regional partners and curb North Korea’s nuclear activity, which could disrupt regional stability and economy.”

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Dalia Naguib on “Tunisia Curbs Credit for Non-Essential Goods as FX Reserves Dip”

“Tunisia is following in the footsteps of Egypt and Algeria and increasing protectionist measures as FX reserves dwindle. MNCs importing certain non-essential goods in Tunisia must assess whether their distributors will be financially capable of providing proof of existing funds to cover those imports, and if needed, determine the level of support they can give.”

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Matthew Kindinger

Matthew Kindinger on “Congo cbank lowers year-end inflation projection to 49.8 pct”

“The central bank of Congo (DRC) has reduced its inflation forecast for year-end 2017 due to higher prices for the country’s main exports such as copper, and a smaller than expected budget deficit. However, inflation will remain very high – FSG forecasts annual average inflation rates of 45% in 2017 and 33% in 2018, adding to existing pressures faced by MNCs to increase prices in the country.”

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Alex Schober on “Argentine government presents details of tax reform”

“Argentina, which ranks 137/137 on tax-rate competitiveness according to the World Economic Forum, will present its tax reform to congress in two weeks. The most important aspect of the plan for MNCs is to reduce the corporate income tax rate from 35% to 25% over five years. Technology companies should also be aware that the government will remove the 17% tax on cellphones, televisions and monitors.”

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Pratima SinghPratima Singh on “World Bank endorses Modi government’s reform credentials”

“The new ranking is a big boost to the Modi government, which was facing challenges in gathering support for recent policy reforms like demonetization and the GST. India joined the list of 10 top improvers with big gains in obtaining permits (through a single window clearance system) and starting a business. Executives should evaluate the impact of recent regulatory changes on their India business.”

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Ryan Connelly on “The Oil And Gas Industry Is Hiring Again”

“WTI Crude Oil, the main American price index, has recently climbed to $54 a barrel, a $10 increase since June. Our view is that prices over $50/barrel will trigger an increase in US shale oil output, which can increase output in a very short time span. A surge in oilfield hiring activity is a good signal that US output will continue to increase for the rest of 2017 and across 2018.”

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