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.
Pratima Singh on “Reserve Bank of India Keeps Policy Rate Unchanged”
“The RBI kept interest rates constant at 6.25% despite market expectations of a 25 basis points cut. This signals that the Bank expects increased upward pressure on prices going forward. Most notable, the central bank cut its growth targets for the Indian economy from 7.6% to 7.1% for the current fiscal year (ending March 2017) in its first official statement since the currency demonetization.”
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Dalia Naguib on “The Tunisian UGTT Union Cancels the General Strike Scheduled Dec. 8”
“Instead of imposing a public sector wage freeze, the government will now spread wage increases over the duration of two years. Prime Minister Chahed’s successful compromise with the country’s biggest trade union will reduce the likelihood of social unrest, though the wage increases will put pressure on Tunisia’s fiscal resources.”
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Cheng Siew Chua on “US firms pin high hope on Vietnam”
“Despite the likely withdrawal of the US from the Trans-Pacific Partnership when president-elect Trump takes office, Vietnam remains an investment destination of choice for many US multinationals due to its strategic location and low-cost production hubs. The trend of increasing foreign direct investment is expected to continue and it is reflective of the improving business environment in Vietnam.”
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Zeynep Kosereisoglu on “Turkey’s privatization authority shifts to Turkish Lira in tenders”
“Executives shouldn’t expect a strengthening lira on account of recent announcements by some public institutions to switch from US dollars to Turkish lira in their operations. The lira is suffering from policy unpredictability, political instability and weakening confidence in the government’s ability to tackle the economy’s structural risks.”
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Athanasia Kokkinogeni on “Eurozone seeks compromise on Greek debt ahead of IMF deadline”
“Pre-election period for key eurozone members next year doesn’t allow for big concessions on Greece’s debt. A final decision on debt relief measures is expected in January, after the December Eurogroup failed to provide a final solution. MNCs should expect some kind of short-term measures reducing Greek debt from next year allowing business confidence to recover faster than expected.'”
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