Articles List

Articles List

Week Ahead: Persistent Low Oil Prices Will Temper Ghana Growth

In the week ahead, we are awaiting Ghana Q2 GDP growth figures. After a fairly robust 4.9% y-o-y Q116 reading, we expect a moderately slower pace of expansion in the months ahead. Low oil prices will have constrained government expenditure as it has strived to abide by the IMF's spending limits, and investors remain cautious given the risks related to the upcoming December presidential elections. This underpins our view for 4.1% real GDP growth in 2016.

2016 Election: 25% Chance Of 'Extreme' Policy Formation

Our core view of gridlock in Washington in 2017-18 following the November 8 election suggests broad macroeconomic policy continuity going forward. However, there is a 25% chance of a 'sweep' by either the Democrats or Republicans in the election, an outcome that could lead to a significant shift in policy. In addition to this risk, we believe that the potential for Trump to use 'executive orders' to steer US policy presents major risks that are being broadly underestimated.

MENA Power RRI: GCC, Egypt And Iran Offer Biggest Rewards

The biggest GCC countries continue to dominate our Risk/Reward Index for the MENA power sector due to their relatively low risk profiles and significant potential for industry growth - despite their fiscal consolidation efforts amid low oil prices.

Gamesa Wins Wind Project Contract

Spanish wind turbine maker Gamesa has been selected by Indian firm ReNew Power to provide engineering, procurement and construction services for a 50MW wind project in Bijapur, Karnataka, India.

Tata Export Goal Supported By Robust CV Demand

We expect strong demand for both light and heavy commercial vehicles in Tunisia, Vietnam, Ecuador, Brazil and the Sub-Saharan African region to support Tata's plan to double overseas sales of commercial vehicles in the next two years.

MENA MGR Outlook: Room For Supermarkets & Hypermarkets To Develop

The regional mass grocery retail sector is largely underdeveloped, with the exception of a few wealthier markets in the GCC. We are starting to see increased levels of investment in the industry, as well as some markets become more open to foreign ownership of retailers. Combined with rising incomes, this should help spur formalisation from a low base throughout the MENA region.

Oncology market to provide lucrative revenue earning opportunities

Cancer will continue to be a significant area of unmet medical need in North Africa's pharmaceutical markets due to factors such as lack of awareness, low affordability levels and greater urbanisation. Innovative drugmakers will seek long-term opportunities in the region's oncology market, with governments expected to improve accessibility to cancer medicines and encourage more proactive systems through awareness campaigns and national programmes of strategy.

Mozambique over Tanzania for onshore LNG

East Africa's gas development is likely to face further delays as companies struggle to secure sufficient contracts in an oversupplied market, limiting their ability to finance capital-intensive projects. The possible entry of ExxonMobil and Qatar Petroleum into Mozambique presents significant upside to its onshore project reaching FID before Tanzania.

Key risks to watch in Q416

Following the UK's vote to leave the EU in June we highlighted the potential for systemic crises to re-emerge across the eurozone given weak growth, rising euroscepticism and a crippled banking sector (see 'Brexit Contagion Could Reignite Eurozone Crisis', June 28). Despite a period of relative market calm, tail risks remain elevated. We note the precarious state of the Portuguese economy and ongoing stress in systemically important banks in Italy and Germany as key risks to watch in the coming months.

FARC peace to offer long-term benefits

The formal cessation of hostilities between the Colombian government and the Fuerzas Armadas Revolucionarias de Colombia (FARC) will result in long-term improvements to the Colombian economy. Although security risks will remain, infrastructure development and public works programmes will integrate more of the country into the national economy.

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