WSJ Emerging & Growth Markets, August 21st 2021
Dan Keeler
Founder of Frontier Markets News, former frontier markets editor at The Wall Street Journal. Follow me on Twitter @dankeeler
Welcome to the latest edition of WSJ Pro Emerging & Growth Markets, our weekly review of key news affecting frontier and small emerging markets. This newsletter is a companion to Strategic Intelligence, an information resource focused on emerging markets that brings together the global news coverage of The Wall Street Journal with the analysis of market intelligence firm FrontierView.?
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Africa
Zambia’s opposition wins surprise landslide as defaulting economy reels.?Zambian opposition leader Hakainde Hichilema was?elected president of Africa’s second-largest copper producer?on Monday, defeating incumbent Edgar Lungu, a close Beijing ally, and marking the first election loss for a sitting African president for two years, Nicholas Bariyo reports. Official results from the Zambian Election Commission declared Mr. Hichilema, an economist who had unsuccessfully contested the election five times, the victor with more than 2.8 million votes to Mr. Lungu’s 1.8 million.
A vendor sells Zambian newspapers reporting on Mr. Hichilema’s win.
PHOTO: MARCO LONGARI/AGENCE FRANCE-PRESSE/GETTY IMAGES
The campaign was fought amid the country’s worst economic crisis in decades, including a?default?on billions of dollars of debt and a darkening outlook aggravated by the impact of the coronavirus.
The wider-than-expected margin of victory means Mr. Hichilema avoided a runoff. Mr. Lungu, whose government had blocked social-media sites and over the weekend alleged the vote was “not free and fair,” conceded on Monday, adding he would “comply with the constitutional provisions for a peaceful transfer of power.”
Nigeria ‘lost $50b in investments’ due to delay in passing new oil laws.?Nigeria’s President Muhammadu Buhari said this week the country lost $50 billion worth of investments because of delays to the reform of its petroleum industry, Obafemi Oredein reports. Mr. Buhari on Monday signed into law a Petroleum Industry Bill that provides a legal, governance, regulatory and fiscal framework for the petroleum industry.
Under the new petroleum act, the Nigerian National Petroleum Corp. is to be fully commercialized into a limited company within six months.
Nigeria is Africa’s largest exporter of oil, which provides more than 90% of the country’s foreign exchange and 70% of government revenue, according to the IMF. The government aims to increase the country’s oil reserves to 40 billion barrels from the present 37 billion barrels and, and to increase production levels to 4 million barrels a day from the current 2.5 million barrels a day.
Asia
Malaysia’s prime minister steps down amid Covid-19 criticism. Malaysia’s?Prime Minister Muhyiddin Yassin resigned early this week?amid criticism over his Covid-19 policies, bringing renewed uncertainty to a government that has been marked by political infighting since Malaysia’s longtime ruling party lost in the wake of one of the world’s largest financial scandals, Jon Emont and Chester Tay write. Mr. Muhyiddin, a veteran politician, took the helm a year and a half ago after breaking with the ruling coalition and Mahathir Mohamad, the country’s then-94-year-old prime minister
New Malaysian Prime Minister Ismail Sabri Yaakob arrived at a hotel for a private function in Kuala Lumpur Friday.
PHOTO: AHMAD YUSNI/EPA/SHUTTERSTOCK
His new coalition came into power with a thin majority and without holding a new election, making it unstable from the start. In recent weeks, it was weakened by defections, with former supporters citing the failed handling of the pandemic, among other reasons, as cause for leaving.
Four days later,?the country’s king named a new prime minister?from the United Malays National Organization, Malaysia’s longtime ruling party that was voted out in the wake of the 1MDB financial scandal.
Taliban takeover of Afghanistan leaves neighbors bracing for flood of refugees.?After facing minimal resistance from government-controlled forces the Taliban took over Afghanistan this week leaving the U.S. and its allies scrambling to evacuate tens of thousands of people from the landlocked South Asian nation. The Wall Street Journal has covered the news intensively—a digest of our coverage over the past week can be found here.?
While the human impact of the takeover will be immeasurable, the economic and financial impact on the region as a whole will be limited, according to Stuart Culverhouse and Patrick Curran at UK-based research firm Tellimer. Most affected will be?Pakistan, whose government will have to perform a delicate balancing act. “Pakistan is likely to find itself in a difficult position with a mixture of increased threat of violence in the country and more refugees, while trying to keep the Taliban onside and balancing its strategic importance to the US and reliance on Western donors,” they said in a report.
Afghan nationals crossed the border into Pakistan on Wednesday. AGENCE FRANCE-PRESSE/GETTY IMAGES
With many thousands of Afghans desperately trying to flee the country, Afghanistan’s neighbors could face a flood of refugees. Pakistan and?Iran are among countries most vulnerable?to a wave of refugees, Saeed Shah, James T. Areddy and William Boston report.
Thomas Hugger, founder and CEO of Hong Kong-based fund manager Asia Frontier Capital, agrees that the movement of refugees into neighboring countries could “distract various governments—especially Iran and Pakistan—at a time when their economies are recovering from the impact of the pandemic.” Mr. Hugger believes many Afghan refugees will try to get to Europe, which “could lead to serious political frictions in certain European countries,” including the?Czech Republic?and?Hungary.
Europe
Belarus dissident at center of jet grounding questions sanctions’ effectiveness.?Roman Protasevich, the Belarusian journalist who was?arrested?after a jet fighter in May forced the commercial airliner on which he was flying to land in Minsk, says he is?turning away from the opposition movement?he helped propel through his grass-roots media network. He also criticized Western?sanctions?introduced to pressure Belarusian President Alexander Lukashenko to step down after a disputed election and over 27 years in power.
“They’re not the best way to solve political problems and the political situation in the country,” Mr. Protasevich said from detention. “Mostly they affect just people. They make Lukashenko more angry and push Belarus much more toward?Russia.”
领英推荐
Roman Protasevich prepared to brief the news media in Minsk on June 14.
PHOTO: AGENCE FRANCE-PRESSE/GETTY IMAGES
His disavowal of the opposition movement comes as a further psychological blow for its leaders, many of whom have fled Belarus to seek safety in neighboring countries including?Poland,?Lithuania?and?Ukraine. Thousands of demonstrators, meanwhile, have been arrested since a wave of protests followed Mr. Lukashenko’s claims that he won last August’s elections. Minsk-based human rights group Viasna says over 600 were still being held as of July.
Latin America
Haiti hit by devastating earthquake and tropical storm.?As the death toll from?Saturday’s powerful earthquake?continued to rise, Haiti on Tuesday was?lashed by heavy rains and powerful winds, José de Córdoba, Ryan Dube and Edver Serisier report. At least 1,941 people were killed in the earthquake, Haitian civil protection officials said Tuesday, with 9,900 injured and more than 60,759 houses destroyed.
People in a Les Cayes refugee camp tried to protect themselves from rains as Tropical Depression Grace passed through.
PHOTO: JOSEPH ODELYN/ASSOCIATED PRESS
Tropical Depression Grace swept across southern Haiti overnight dumping between 5 and 10 inches of rain across the area, with some parts receiving as much as 15 inches, according to the U.S. National Hurricane Center.
The heavy rain caused misery for people who had been sleeping in the streets in tents and under plastic sheets, unable to return home after Saturday’s quake destroyed tens of thousands of buildings. Many of the makeshift shelters people had made were torn apart by the winds.
Latin American nations are catching up in Covid-19 vaccination push. Vaccination?rates in Latin America have risen sharply, with a host of countries now inoculating against Covid-19 at a far higher rate than the U.S., Ryan Dube and Juan Forero report. As supply problems that hindered the early vaccination efforts are easing, people across the region are eager to get vaccinated—and largely trust vaccines.
“Latin America has always been a champion for vaccination and people trust vaccines,” said Patricia García, a former Peruvian health minister and epidemiologist. “If we are able to get enough supply of the vaccines, we can catch up.”
Roughly two-thirds of people in?Chile?and?Uruguay?are fully vaccinated, compared with about half in the U.S., and a number of other countries are closing the gap fast. In recent weeks,?Brazil?has been applying nearly 1.5 million doses a day, and in the past week,?Panama?vaccinated its people at six times the rate of the U.S.
The faster pace of vaccination comes not a moment too soon for a region that has been the hardest hit during the pandemic by some measures. With 8% of the globe’s population, Latin America accounts for roughly a third of global deaths from the pandemic, according to figures from Johns Hopkins University.
What We’re Reading
Dozens killed in northern?Burkina Faso?rebel attack. (Al Jazeera)
C?te d’Ivoire?accelerates Ebola vaccination after second suspected case. (RFI)?
Zimbabwe?may tap private creditors to pay evicted white farmers. (Bloomberg)?
Egypt?plans IPO of state-owned company building new capital city. (The National)?
Analysis: New escalation in?Ethiopia’s?Tigray war. (AhramOnline)?
Vietnam’s?Covid stumble threatens economic boom. (Asia Times)?
Asian?nations, hit by Covid-19 Delta wave, tighten curbs on movement. (WSJ)?
Sri Lanka?pledges no new coal, makes push into rooftop solar. (Yale Environment 360)?
How?China?may benefit from Afghanistan’s mineral reserves following the Taliban takeover. (MarketWatch)?
China’s?Communist Party goes back to basics: Less for the rich, more for the poor. (WSJ)?
U.S.?vice president to focus on countering?China?on?Southeast Asia?trip. (WSJ)?
Volunteers collect the dead as Covid-19 devastates?Indonesia. (WSJ)
Fuel explosion in?Lebanon?kills 28. (WSJ)
Saudi?oil giant Aramco joins group planning 1.5 GW solar project. (S&P)?
Turkey?offers additional Pfizer shots amid concerns over?Chinesevaccine’s effectiveness. (WSJ)??
Hundreds of?Cuban?protesters are still detained, including prominent dissidents. (Miami Herald)?
Opinion: Biden is failing?Cuba’s?uprising. (WSJ)??