Mexico's auto industry enjoys strong momentum

2015 ◽  
Keyword(s):  
Natural Gas ◽  
Oil Prices ◽  
Economic Reforms ◽  
The Other ◽  
Electricity Prices ◽  
Short Term ◽  
Content Type ◽  
Competitive Edge ◽  
Labour Costs ◽  
Negative Shock

Significance Further investments are to follow. Ford is expected to announce on April 17 that it will invest 2.5 billion dollars to build engines and transmissions, with about half the amount invested in northern Chihuahua, the other half in Guanajuato. Impacts Booming auto production and exports should partly compensate for the negative shock from falling oil prices. Recent economic reforms should also enhance competitiveness, notably as natural gas and electricity prices fall towards world levels. Labour costs have not risen significantly in recent years, but greater wage demands by automotive unions cannot be discarded. Recent peso depreciation should add at least a short-term boost to Mexico's competitive edge in dollars.

Impact of fossil fuel prices on electricity prices in Mexico

2019 ◽  
Vol 46 (2) ◽  
pp. 356-371 ◽  
Author(s):  
Bruno Bernal ◽  
Juan Carlos Molero ◽  
Fernando Perez De Gracia
Keyword(s):  
Natural Gas ◽  
Crude Oil ◽  
Fossil Fuel ◽  
Positive Impact ◽  
Electricity Price ◽  
Electricity Prices ◽  
Content Type ◽  
Fuel Prices ◽  
Electricity Rates ◽  
Domestic Electricity

Purpose The purpose of this paper is to examine the impact of fossil fuel prices – crude oil, natural gas and coal – on different electricity prices in Mexico. The use of alternative variables for electricity price helps to increase the robustness of the analysis in comparison to previous empirical studies. Design/methodology/approach The authors use an unrestricted vector autoregressive model and the sample covers the period January 2006 to January 2016. Findings Empirical findings suggest that crude oil, natural gas and coal prices have a significant positive impact on electricity prices – domestic electricity rates – in Mexico in the short run. Furthermore, crude oil and natural gas prices have also a significant positive impact on electricity prices – commercial and industrial electricity rates. Originality/value Two are the main contributions. First, this paper explores the nexus among crude oil, natural gas, coal and electricity prices in Mexico, while previous studies focus on the US, UK and some European economies. Second, instead of using one electricity price as a reference of national or domestic electricity sector, the analysis considers alternative Mexican electricity prices.

External factors condition Chile's economic outlook

2015 ◽  
Keyword(s):  
Trade Balance ◽  
Power Plants ◽  
Oil Prices ◽  
External Factors ◽  
Gdp Growth ◽  
Electricity Prices ◽  
Local Growth ◽  
Content Type ◽  
Copper Mines ◽  
Economic Outlook

Significance This year, Chile will face a complex mix of external factors as it seeks to reverse last year's deceleration of GDP growth. Conflicting effects on areas that include not only the trade balance but also investment, inflation and fiscal revenues make forecasts for the economy's performance this year more than usually uncertain. Impacts Industry estimates suggest that up to half of Chile's 1,000 small copper mines could be forced to close. Because some Chilean power plants use diesel, international oil prices will have an important spin-off effect on electricity prices. In coming months, local growth forecasts will be particularly sensitive to news from overseas -- especially China.

Africa's 'oil price winners' face mixed prospects

2015 ◽  
Keyword(s):  
Southern Africa ◽  
Oil Prices ◽  
Oil Price ◽  
Political Space ◽  
Medium Term ◽  
Short Term ◽  
Economic Diversification ◽  
Content Type ◽  
Civil Unrest ◽  
Sub Saharan

Subject Africa's oil price winners. Significance Despite traditionally being winners during periods of oil price decline, the medium-term outlook is mixed for sub-Saharan Africa's (SSA) oil importing countries -- reflected in the IMF's recent downgrade of its SSA outlook from 5.75% to 4.9%. Short-term gains reduce the fuel import bill, but uncertainty looms over energy investments in eastern African, while idiosyncratic risks cloud the outlook for southern Africa. While oil exporters may also reap some benefits, much will depend on the degree of oil dependency, political space to make the necessary policy retrenchments, and the extent of government financial buffers. Impacts If sustained, low oil prices could provoke civil unrest, rather than reforms, in oil exporting countries. Most oil exporters will struggle to maintain macroeconomic stability if oil remains low for more than a year. However, economic diversification to some degree helps to shield the region from sharp global slowdowns.

Mozambique juggles new interests and old problems

2015 ◽  
Keyword(s):  
Natural Gas ◽  
Liquefied Natural Gas ◽  
Traditional Agriculture ◽  
Short Term ◽  
Content Type ◽  
Electoral Support ◽  
Debt Stress ◽  
Fiscal Risks

Subject Mozambique's new government. Significance President Filipe Nyusi on January 17 unveiled his first cabinet. The line-up marks a break with the administration of former President Armando Guebuza, but balances competing factions within the ruling FRELIMO party. The new government's main focus will be to turn offshore natural gas discoveries into liquefied natural gas (LNG) exports. Declines in FRELIMO's electoral support indicate pressure to demonstrate more inclusive benefits than has been the case with previous mega-projects. Impacts Lower prices for traditional (agriculture) and megaproject exports (coal, aluminium) will continue; last year exports fell by 8.4%. With mining under stress, companies may delay production expansion planned to take place after the completion of the Nacala railway. For the short term, fiscal risks are greater than debt stress -- particular given 2014 election-related spending.

US tensions prompt closer China-Russia cooperation

2019 ◽  
Keyword(s):  
Natural Gas ◽  
Consumer Goods ◽  
The Other ◽  
High Tech ◽  
Content Type ◽  
Economic Relations ◽  
Economic Interaction ◽  
Economic Ties ◽  
The Eu

Subject China-Russia cooperation. Significance Beijing and Moscow are compensating for deteriorating ties with Washington by building -- or at least declaring -- close political and economic relations with each other. Chinese exporters of production and consumer goods are replacing Western companies that are curtailing activities due to Western sanctions and Moscow’s countersanctions. However, neither Beijing nor Moscow sees the other as a true substitute for normal relations with Washington. Impacts China and Russia will more actively use the renminbi and ruble as settlement currencies. Russia will preserve its position as China’s key supplier of oil and will significantly expand deliveries of natural gas. Russia will press for closer ties in high-tech industries; China will be wary, fearing this might prompt new US sanctions. The epicentre of Russia’s foreign economic ties will shift further from the EU to China. Greater economic interaction with Russia will help China cement its relations with other former Soviet countries.

Epidemic may shake Chad's government

2020 ◽  
Keyword(s):  
Economic Impact ◽  
Death Rate ◽  
Oil Prices ◽  
New Wave ◽  
Short Term ◽  
Bottom Up ◽  
Content Type ◽  
The Government ◽  
The Impact ◽  
Mission Operation

Subject COVID-19 impact on Chad. Significance Chad has a relatively low number of confirmed COVID-19 cases but appears quite vulnerable to the impact of the pandemic, especially the economic impact. The country’s highly rural and youthful demography may help to slow the spread and keep the death rate low. Yet low oil prices, a return to recession and a new wave of sector-specific protests could pose major challenges for the government. Impacts Chad's epidemic appears unlikely to affect France’s Sahel counterterrorism mission Operation Barkhane, headquartered in Chad. A bottom-up revolution appears unlikely, and no major rebel challengers appear poised to take advantage of COVID-19 and associated crises. President Idriss Deby's government appears unlikely to fall in the short term -- French backing will continue to ensure his survival.

Mexico's weak GDP growth will outlast Pena Nieto

2016 ◽  
Keyword(s):  
Latin American ◽  
Economic Reforms ◽  
Gdp Growth ◽  
Short Term ◽  
Severe Problem ◽  
Content Type ◽  
World Economic ◽  
The Government ◽  
Latin American Countries ◽  
Economic Outlook

Subject GDP growth shows no sign of improving in the short-term. Significance In its most recent update to its World Economic Outlook, the IMF lowered its forecast for Mexico's 2016 GDP growth to 2.4% from 2.6% foreseen in January. This figure compares well with other Latin American countries -- notably Brazil and Venezuela -- yet it marks the continuation of a trend of meagre expansion that has characterised President Enrique Pena Nieto's time in office despite his efforts to introduce economic reforms. Impacts Further reform to encourage greater flexibility in the labour market will be key to increasing small business productivity. Low growth and a lack of prospects for the young will feed into Mexico's rising crime rates. The lack of growth could become a severe problem for the government both directly and indirectly in the 2018 election.

Kuwait energy sector expansion will hit obstacles

2015 ◽  
Keyword(s):  
Saudi Arabia ◽  
Natural Gas ◽  
Crude Oil ◽  
Production Capacity ◽  
Oil Prices ◽  
Energy Sector ◽  
Global Market ◽  
Oil Refinery ◽  
Content Type ◽  
Crude Oil Production

Subject Prospects for Kuwait's energy sector expansion Significance Despite falling revenue because of the slump in global oil prices Kuwait is embarking on two ambitious energy ventures: constructing what will be the region's largest new oil refinery and increasing crude oil production capacity by more than 1 million barrels per day (b/d) by 2020. Impacts Increased oil output capacity will bolster Kuwait' s effort to retain market share in an over-supplied global market. Kuwait is emulating Saudi Arabia in integrating its refining and petrochemical sectors, though diversification will lag. Kuwait will incur Saudi displeasure by developing closer ties with post-sanctions Iran, a possible supplier of new natural gas supplies.

Doha disagreement delineates Saudi-Iranian rivalry

2016 ◽  
Keyword(s):  
Saudi Arabia ◽  
Comparative Advantage ◽  
Oil Prices ◽  
Short Term ◽  
Content Type ◽  
Industrial Action ◽  
Long Run

Significance Many producers, facing budgetary pressures because of low oil prices, support output restraint, but they need to act in concert. Russia and Saudi Arabia have offered a freeze rather than cuts, and Riyadh is not prepared to adopt any stance that provides a comparative advantage to regional rival Iran. Impacts Prices could rise somewhat in the short term due to the drop in Kuwaiti production caused by industrial action. Another factor pushing up oil prices could be any further upward revision to the expected contraction in US crude output. Downside risks dominate in the long run, owing to producers' inaction, record inventories and the return of interrupted supplies.

Economic downturn may be on the horizon in Ecuador

2019 ◽  
Keyword(s):  
Current Account ◽  
Current Account Deficit ◽  
Oil Prices ◽  
Import Demand ◽  
Export Growth ◽  
Economic Downturn ◽  
Short Term ◽  
Content Type ◽  
The Government ◽  
Spending Cuts

Subject Economic challenges. Significance In the first quarter, Ecuador’s economy grew at its weakest pace since the 2016 recession. The government is facing significant challenges in implementing a recently agreed IMF programme, while President Lenin Moreno’s popularity has plummeted following unpopular, but arguably necessary, spending cuts. Impacts Dollar appreciation and a tightening of global financing conditions would weaken Ecuador’s competitiveness. Short-term, the current account deficit will narrow, as rising oil prices support export growth and the slowdown weighs on import demand. Moreno’s diminishing popularity will exacerbate uncertainty around implementation of the IMF programme.

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