Growth may accelerate under new Slovak government

2016 ◽  
Keyword(s):  
Growth Rates ◽  
Prime Minister ◽  
Government Expenditure ◽  
Political Risk ◽  
Gdp Growth ◽  
Short Term ◽  
Content Type ◽  
Investment Grade ◽  
New Education ◽  
Health Teachers

Significance The governing coalition has a comfortable parliamentary majority, but faces gathering concerns over Prime Minister Robert Fico's health, teachers' protests over wages and opposition calls to dismiss the new education minister. Impacts Short-term fiscal deterioration is expected in 2016-18 (the deficit is likely to remain elevated), as government expenditure rises. Nevertheless, Slovakia's investment grade is expected to remain solid. This is due to strong levels of FDI in autos, with local businesses making use of EU funds and subsidies for new investments. Political risk will diminish in line with higher GDP growth rates and lower rates of unemployment. This will be particularly so after 2017 once government measures have fed through to the economy.

THE CAUSE OF HIGHER ECONOMIC GROWTH: ASSESSING THE LONG-TERM AND SHORT-TERM RELATIONSHIPS BETWEEN ECONOMIC GROWTH AND GOVERNMENT EXPENDITURE

2014 ◽  
Vol 20 (1) ◽  
pp. 229-250 ◽  
Author(s):  
Motasam Tatahi ◽  
Emre Ipekci Cetin ◽  
M. Koray Cetin
Keyword(s):  
Economic Growth ◽  
Growth Rate ◽  
Growth Rates ◽  
Government Expenditure ◽  
Government Expenditures ◽  
Gdp Growth ◽  
Short Term ◽  
Data Set ◽  
Dynamic Relationship

This study examines the cause of higher (5% or more) economic growth rates in countries around the world over the past 35 years. It explores the long- and short-term relationships between GDP and government expenditures in these countries. A panel data set of 60 countries over the period from 1976 to 2010 is deployed to implement pooled mean group estimation. Countries are divided into three economic growth rate groups: high, middle, and low. Panel-based/error correction models are used to estimate long-term equilibrium relationships and short-term dynamics between government expenditures and GDP growth rates. Results indicate that the hypothesis of a common long-term elasticity and a short-term dynamic relationship between GDP growth rates and government expenditures cannot be rejected for high group countries, whereas for middle group countries this is true only for the long term, not for the short term. No long-term or short-term relationship between these two variables exists for low-growth-rate countries.

Politics set to slow Pakistan's divestment drive

2016 ◽  
Keyword(s):  
Public Sector ◽  
Economic Reform ◽  
Prime Minister ◽  
Structural Reforms ◽  
Short Term ◽  
Content Type ◽  
Reform Agenda ◽  
Political Patronage ◽  
The Government ◽  
Core Condition

Subject Pakistan's divestment drive. Significance Prime Minister Nawaz Sharif's government describes divestment of public sector enterprises (PSEs), involving 69 firms, as an essential part of its 2013-18 economic reform agenda. Progress thus far is limited, but the government faces rising pressure from the IMF, which made divestment a core condition of its 6.6-billion-dollar, three-year loan in September 2013. Impacts Another government led by Sharif would continue gradual divestments after 2018. Since PSEs are an important vector for distributing political patronage, structural reforms will face stiff resistance. Divestment of profitable PSEs defeats the purpose of the exercise, but the government will use them for a short-term cash boost.

Insecurity and drought undermine Madagascar president

2016 ◽  
Keyword(s):  
Interest Rate ◽  
Prime Minister ◽  
Commodity Prices ◽  
Southern African Development Community ◽  
Political Elite ◽  
The Political ◽  
Gdp Growth ◽  
Content Type ◽  
African Development ◽  
The Government

Significance Rifts within the political elite are deepening, evidenced by the departure of former Prime Minister Jean Ravelonarivo -- and his cabinet -- last month. However, the installation of a new administration does not portend stability. Impacts The central bank's decision to cut its benchmark interest rate to 8.3% from 8.7% will facilitate borrowing by firms and households. This is unlikely to boost GDP growth given the countervailing effects of political volatility and low commodity prices. The UN secretary general's appeal (on an official trip earlier this month) for the government to tackle graft is unlikely to be heeded. If Madagascar experiences another coup, the Southern African Development Community bloc will likely expel it -- again.

Weak consumption may thwart Slovak growth plans

2016 ◽  
Keyword(s):  
Infrastructure Investment ◽  
Gdp Growth ◽  
Industrial Output ◽  
Short Term ◽  
Fiscal Deficits ◽  
Consumption Growth ◽  
Content Type ◽  
Low Levels ◽  
The Government ◽  
The Eu

Subject The government's latest GDP expectations for 2016-19. Significance On September 19, days before surviving a parliamentary no-confidence vote, the government announced GDP projections for 2016-19, based on improvements in consumption growth and the labour market, where registered unemployment hovers at historically low levels. Despite its weakened position following the recent departure of junior coalition partner Siet, Smer-Social Democracy (SD) is upbeat about the prospects for robust GDP growth in 2016, revising its forecast upwards to 3.6% from 3.2%. Impacts Industrial output, GDP and inflationary pressures may pick up post-2018, as consumers spend more and auto industry investments create jobs. The government may miss its targets in the short term, but fiscal deficits should remain below the EU limit of 3% of GDP in 2016-18. More public-private partnerships, modelled on the Bratislava ring-road, plus EU funding, may support infrastructure investment after 2017.

Economic reform will falter with new Turkish cabinet

2015 ◽  
Keyword(s):  
Monetary Policy ◽  
Economic Reform ◽  
Prime Minister ◽  
Job Creation ◽  
Domestic Demand ◽  
Election Campaign ◽  
Short Term ◽  
Content Type ◽  
Political Risks ◽  
Financial Difficulties

Significance Presenting his government's programme on November 25, Prime Minister Ahmet Davutoglu promised to keep his election campaign pledges, complete major infrastructure projects, maintain fiscal stability and implement structural change. Impacts Domestic demand will strengthen in the short term. However, firms in labour intensive sectors may face financial difficulties, and new job creation may be slow. Currency and capital markets are likely to remain volatile and overreact to trends in monetary policy and the current account. Opportunities exist for those investors able to tap into the government's priorities and avoid political risks.

Colombia’s infrastructure expansion faces major delays

2017 ◽  
Keyword(s):  
Growth Rates ◽  
Infrastructure Investment ◽  
Gdp Growth ◽  
Election Campaign ◽  
Infrastructure Projects ◽  
Caribbean Coast ◽  
Content Type ◽  
Investment Opportunities ◽  
The Caribbean ◽  
New Infrastructure

Significance The claims follow the ANI’s announcement on February 22 that it would cancel the contract of an Odebrecht-led consortium to build the Ruta del Sol 2 highway, linking central Colombia to the Caribbean coast. Impacts The risk of potentially intrusive investigations will remain high for firms with commercial or contractual links to Odebrecht. Delays in completion of infrastructure projects could bring Colombia’s GDP growth rates for 2017 below the current forecasts of 2.7%. Later in the year, new infrastructure investment opportunities will open as corruptly awarded contracts are resubmitted for tender. Allegations that Santos’s 2014 election campaign received Odebrecht funding could harm his Party of the U in the 2018 election.

India’s central bank will be more amenable to Modi

2019 ◽  
Keyword(s):  
Prime Minister ◽  
Fiscal Year ◽  
Gdp Growth ◽  
Content Type ◽  
Reserve Bank ◽  
Bharatiya Janata Party ◽  
Consecutive Term ◽  
Indian Banks ◽  
Bad Debt ◽  
Reserve Bank Of India

Subject RBI under new governorship. Significance Shaktikanta Das was last month appointed Reserve Bank of India (RBI) governor after Urjit Patel resigned. Prime Minister Narendra Modi’s government had for several months clashed with the RBI over how to foster economic growth. The general election is likely in April or May, when Modi’s Bharatiya Janata Party (BJP) faces a tough fight to win a second consecutive term. Impacts In election campaigning, Modi will emphasise India’s mostly robust quarterly GDP growth figures during his term. Indian banks’ level of bad debt could decrease by the end of the fiscal year ending March 2019. India will likely widen its fiscal deficit target for 2018/19 (3.3% of GDP) ahead of the 2019/20 budget.

Bangladesh’s drug war helps ruling party in short term

2018 ◽  
Keyword(s):  
Prime Minister ◽  
Refugee Camps ◽  
Illegal Trade ◽  
Short Term ◽  
Drug War ◽  
Content Type ◽  
North East ◽  
Security Personnel ◽  
High Commissioner ◽  
Ruling Party

Subject Bangladesh's narcotics crackdown. Significance Prime Minister Sheikh Hasina is overseeing a ‘drug war’, with security personnel targeting illegal trade in yaba (methamphetamines). The Office of the UN High Commissioner for Human Rights (OHCHR) has criticised the campaign, in which an estimated 150 people have been killed and at least 13,000 arrested since mid-May. The ruling Awami League (AL) is expected to retain power in the general election, due by late December. Impacts The yaba trade will worsen social conditions in Rohingya refugee camps. India’s north-east could face an increasing problem of yaba trafficking. Bangladesh’s election campaign is likely to involve widespread use of undeclared money.

Papua New Guinea may encounter 'resource curse'

2018 ◽  
Keyword(s):  
Papua New Guinea ◽  
Prime Minister ◽  
Resource Curse ◽  
New Guinea ◽  
Business Environment ◽  
Asia Pacific ◽  
Gdp Growth ◽  
Content Type ◽  
Recent Policy ◽  
Economic Outlook

Subject The economic outlook for Papua New Guinea. Significance Rating agency Moody’s on March 23 shifted Papua New Guinea (PNG) to 'negative watch', a further indication of the economic challenges facing the re-elected Peter O’Neill government as it prepares to host the Asia-Pacific Economic Cooperation (APEC) summit in November this year. PNG in February suffered its largest earthquake for nearly a century in areas surrounding the largest resource projects in the country. Impacts Despite a planned major expansion in LNG production, recent policy decisions suggest a troubled business environment. Reversals in economic policy, combined with the earthquake, will further depress GDP growth. Prime Minister Peter O’Neill is weaving together a large coalition which should cement his position until at least after APEC. Foreign exchange shortages will harm growth and discourage investment, due to fears that firms cannot pay dividends to foreign shareholders.

Sign in / Sign up

Export Citation Format

Share Document