Articles List

Local Content Change Unlikely To Drive LNG Development

The clarification of local content policy may encourage foreign companies to invest in Tanzania's energy sector. However, this will not have an immediate impact on gas production or the development of the country's LNG sector.

Home And Away: Privatisation Drive Sparking Russian IPOs

Thanks largely in part to the government’s fiscal reform agenda and the subsequent privatisation programme that comes with it, Russian IPOs are coming back into the spotlight, both at home and abroad. In BMI’s view, we look set to remain in a bull market over the coming quarters. Indeed, Moscow's proposed privatisation agenda will be at the centre of this increase in floatation activity after the Kremlin announced, back in Q117, that it had approved a three-year initiative for the selling down of state assets, established with the sole intention of raising funds to plug holes in the sovereign's balance sheet. We note that this deficit was caused by a surge in social outlays, reflecting the government's effort to support the economy out of a recession brought on by a rise in military spending and, more significantly, by low oil prices seen over the last couple of years weighing on state revenues.

Rising Economic Risks From Independence Referendum

Political uncertainty in the aftermath of the independence referendum in Iraqi Kurdistan will weigh on investor perceptions over the coming years, further stretching an economy already affected by the low oil price environment. The likelihood of high-impact economic sanctions is low at this stage, but were they to be implemented they would have dramatic consequences for the KRG's economy.

Glencore Seeking Further Downstream Exposure

The acquisition of Chevron's South African Downstream business represents further opportunity for Glencore to grow its fuels distribution business, creating more vertically integrated operations that help mitigate narrowing trading margins. Similarly, consolidating its position in Africa will help target emerging fuels demand in the region.

Record Solar Bid Necessitates Caution

We are retaining our muted forecast for Saudi Arabian solar capacity until there is more clarity on the terms of the record low bid for solar capacity that was registered during the kingdom's first auction.

Coalition Formed, But Likely To Prove Unstable

The incoming four-party Dutch coalition government is likely to prove fractious and unstable, given the notable differences in policy stances among its members. While the liberal VVD, Christian democrat CDA, centrist D66, and socially conservative CU will have few differences on economic policy, wide divisions on social policy will hinder government cohesion and could result in a breakup of the coalition and snap elections.

What Is Driving Industries In 2017?

In our mid-year review of 2017's industry trends we can clearly detect the forces that are having the greatest impact across several industries, from political and trade risks to technological disruption. We separate them into external forces and internal industry trends, a distinction that enables us to trace some common threads between different industries.

Visualising Our Key Industry Themes

The following diagram illustrates how many of our key cross-industry trends interact with each other. In general, we expect these themes to play out over a three-to-ten-year horizon.

Near-Term Growth Likely To Remain Supported

The Laotian economy grew by 7.0% in 2016, its slowest growth since 2005, and we expect real GDP growth to stabilise in the near-term, supported by the recovery in copper prices, rising electricity exports, and a strong pipeline of hydropower and transport construction projects.

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