FocusEconomics Insights - Latest Posts
August 12, 2021
The U.S. economy has been in rip-roaring form so far this year, buoyed by the lifting of restrictions, vast fiscal stimulus, and consumers running down excess savings. GDP increased solidly in H1, while the unemployment rate continued to tumble and job gains were brisk through July. Our panelists see activity growing at the fastest pace in decades this year, with the economy already above its pre-pandemic level.
August 11, 2021
Over the past three months our LatinFocus Consensus Forecast has jumped 0.9 percentage points, bringing regional GDP growth up to 5.7% for 2021. The stark upward revision has been predominately driven by an accelerating vaccine rollout in key countries such as Argentina, Brazil, Chile and Mexico, while all but Mexico have also seen clear downward trends in new Covid-19 cases since June, boding well for the economic outlook. Moreover, the strong rise in commodity prices since the start of the year, coupled with the ongoing recovery in global economic activity, has supported the external sector, further boosting the GDP outlook in recent months.
July 12, 2021
In late June, the EU slapped sanctions on Belarus over the hijacking of a Ryanair flight that occurred on 23 May. Looking back at the range of sanctions applied since the 9 August election last year, these are the most serious yet, with potential for a real impact on the economy. As well as targeting government officials and individuals linked with the regime, the sanctions aim to restrict Belarussian access to European capital markets. They also target key exports, such as potash and petrochemicals, which constitute a major source of foreign currency for the country. To further explore the sanctions and their potential economic impact, we interviewed two of our panelists: Andrei Melaschenko (AM), Russia/CIS+ economist at Renaissance Capital, and Piotr Soroczyński (PS), chief economist at the Polish Chamber of Commerce.
June 28, 2021
Over the coming quarters, the UK is seen growing faster in sequential terms than most European neighbors, spurred by its swift vaccine rollout and ample fiscal support. In the longer term, British growth prospects also compare favorably to those of the EU. Six months on from Brexit then, to the untrained eye the UK economy appears to have emerged relatively unscathed. So what exactly has changed?
June 23, 2021
The 15–16 May constitutional convention election threw up a major surprise, with independent candidates winning a large share of the vote, and the right-wing coalition failing to obtain the one third of seats needed to form a blocking minority. Delegates now have a maximum of 12 months to draw up a new constitution, which could shift the country towards a profoundly different socioeconomic model. To examine the implications of the vote, and the outlook for Chile’s economy going forward, we spoke to Alejandro Fernández Beroš, chief economist at Gemines, Guillermo Le Fort Varela, CEO of Le Fort Economía y Finanzas, and Nathan Pincheira Guzmán, chief economist at Fynsa.
- Alejandro Fernández Beroš has been chief economist at Gemines since 1993. He is in charge of macroeconomic projections and carries out the political analysis associated with the authorities’ decisions that have an impact on the economy.
- Guillermo Le Fort Varela is CEO of Le Fort Economía y Finanzas, and is also a professor at the Universidad de Chile and president of the Center of Studies for Democracy and Development. He has a PhD from the University of California, Los Angeles (UCLA).
- Nathan Pincheira Guzman has been chief economist at Fynsa since 2017, and before that worked for Banchile Inversiones. He holds degrees from the Universidad de Chile.
China’s demographic headache: How changing population dynamics will affect the Asian giant’s economy in the years ahead
June 9, 2021
China’s recent census data shows that the population is ageing fast, and will likely start declining within a few years. We examine the implications for China’s economy, and the country’s place on the world stage.
May 31, 2021
On 1 February, Myanmar’s military seized power and detained several government leaders, triggering domestic and international backlash and sending the economy into a tailspin. Although the reporting of official data has stopped since the takeover, secondary sources point to paralyzed government activity, closing firms, a frozen banking sector, collapsing new business registrations and rising prices. Meanwhile, Western countries condemned the coup, imposing sanctions, while regional peers have opted for a less confrontational approach. To examine the country’s outlook in more depth, we spoke to Jason Yek, senior country risk analyst at Fitch Solutions, and Tom Anderson, economist at Mekong Economics.
Jason Yek is a senior country risk analyst who joined Fitch Solutions in 2017. He is the lead analyst for more than half a dozen emerging and frontier markets combined in the Mekong region and South Asia, including India and Vietnam.
Tom Anderson is an economist at Mekong Economics in Yangon. Headquartered in Hanoi, Mekong Economics is a leading economic and socio-economic development and commercial consulting firm active in the Greater Mekong sub-region and Asia-Pacific region.
May 26, 2021
100 years ago, the economies of Argentina and Canada had much in common. Fast forward to today, and the similarities are much less evident. Over the past century, Canada has successfully transitioned into a high-income nation, while Argentina has struggled to remain internationally competitive. The reasons for such a divergence in fortunes are complex and manifold, and form part of a process spanning many decades. But three factors stand out: Human capital levels, institutional solidity and economic openness.
May 13, 2021
Following two global crises in quick succession, public debt-to-GDP ratios in many countries are now at multi-decade highs, and our panelists see no progress on reducing global public debt levels over our forecast horizon. Should we be concerned?
May 3, 2021
On 1 January, African countries opened their markets under the first phase of the African Continental Free Trade Agreement (AfCFTA), consenting to lower tariffs on 90% of products over the next five to ten years. As such, SSA countries are expected to benefit from a reduction of trading restrictions, likely boosting merchandise exports and improving regional value chains. Moreover, the deal should accelerate regional economic growth and productivity, lifting employment, while it should also boost business sentiment and attract investment. However, many countries are yet to ratify the deal, and several aspects are still being hammered out, including protocols on competition policy and intellectual property rights. Moreover, poor infrastructure, bureaucratic barriers, security issues and social unrest represent key risks to implementation.
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