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Emerging Markets Daily - April 2
Oil Prices Rise on OPEC Tightening, ByteDance Hits $400 B Valuation, U.S Reduces Military in Saudi Arabia, Kenya Activates 5G, Turkey Outflows Hit 15 Year Record
The Top 5 Emerging Markets Stories from Global Media - April 2
Oil Prices Rise as Opec+ Agrees to Gradually Increase Supply
“Oil prices rose as Opec+ agreed to gradually increase production over the next three months, as the group bowed to pressure from producers to bring supply back to the market.”
“Brent, the international marker, jumped 1.32 per cent to $63.57 per barrel at 8.05pm UAE time. West Texas Intermediate, which tracks US crude grades, was up 1.93 per cent at $60.30 per barrel.”
“The alliance, led by Saudi Arabia and Russia, will convene monthly to consider increases in output "with every adjustment being no more than 500,000 barrels per day", Opec said in a statement on Thursday.”
“The group will increase output by 250,000 bpd in May, followed by 350,000 bpd in June and 400,000 bpd in July.” Jennifer Gnana reports
ByteDance Value Reaches $400 billion, Mulls IPO
South China Morning Post
“The valuation of ByteDance is approaching US$400 billion for private-equity investors, a source told the South China Morning Post, as the Chinese owner of short video-sharing app TikTok cements its leading position among global tech unicorns.”
“The person, who was briefed on the matter, said the value of the Beijing-based start-up has been swelling in the private market as it considers a public listing for TikTok’s Chinese sibling app Douyin.”
“The new valuation of nearly US$400 billion, if confirmed, almost triples ByteDance’s US$140 billion valuation after its series C fundraising in March 2020, according to data from analytics firm CB Insights.” Zhou Xin and Coco Feng report
Geopolitics: U.S Reduces Military Footprint in Saudi Arabia
The Wall Street Journal
“President Biden has directed the Pentagon to begin removing some military capabilities and forces from the Gulf region in the first steps of an effort to realign the U.S. global military footprint away from the Mideast, changes that come as Saudi Arabia endures rocket and drone attacks from inside Yemen and Iraq.”
“In moves that haven’t been previously reported, the U.S. has removed at least three Patriot antimissile batteries from the Gulf region, including one from Prince Sultan Air Base in Saudi Arabia, that had been put in place in recent years to help protect American forces.”
“Other capabilities, including an aircraft carrier and surveillance systems, are being diverted from the Middle East to answer military needs elsewhere around the globe, according to U.S. officials. Additional reductions are under consideration, officials said.”
“Mr. Biden pledged after taking office that he would recalibrate the U.S.-Saudi relationship, taking several tough steps against the kingdom, including freezing the sale of offensive weapons that Riyadh has used in its six-year military intervention in Yemen. He also made public an intelligence report saying Crown Prince Mohammed bin Salman, the country’s de facto leader, approved the operation that led to the 2018 killing of journalist Jamal Khashoggi.”
“But administration officials also have said they don’t want to destroy the U.S.-Saudi relationship, and have said they will seek ways to help Riyadh defend against rocket and missile attacks from militant fighters.” Gordon Lubold and Warren P. Strobel report.
Kenya Becomes Second Country in Africa to Activate 5G Network
RCR Wireless News
“African carrier Safaricom activated its 5G network in Kenya, the telco said in a release.”
“The new 5G infrastructure, which was launched in the cities of Nairobi, Kisumu, Kisii and Kakamega, is expected to be expanded to 150 sites across nine towns over next twelve months.”
“Safaricom said that the 5G network trials will begin with both individual and enterprise customers in these initial four cities.”
“The telco said that the main goal of the trial would be to offer access speeds of up to 700 Mbps with plans to offer than 1,000 Mbps speeds in coming months.” Juan Pedro Tomás reports
Turkey’s Central Bank Revamp Spurs Biggest Outflows in 15 Years
“Foreign investors sold Turkish assets at the fastest pace in 15 years last week after President Recep Tayyip Erdogan unexpectedly replaced the country’s hawkish central bank governor with a vocal critic of high interest rates.”
“International funds sold $1.9 billion of Turkish government bonds and stocks in the week ending March 26, the biggest outflow since May 2006, according to the latest data released Thursday. The exodus spurred an 11% decline in the lira over the same period, pushing it close to a record low.” Ugur Yilmaz reports
What We’re Also Reading…
We’re also reading the always astute Jonathan Fulton (an Emerging World fellow traveler) on Chinese Foreign Minister Wang Yi’s visit to the Middle East, entitled Mr. Yang Goes to the Middle East published by the Atlantic Council.
Fellow traveler and analyst Elana Delozier also has penned a very smart strategy paper for the Washington Institute on the Red Sea region. The Case for a Holistic U.S Policy Toward the Red Sea Region is a must-read.
What Fellow Travelers Are Reading, Watching, etc…
Fellow traveler Monty Simus is one of the great international road warriors. He's hard to keep up with. Back in the pre-Covid days, he logged hundreds of thousands of miles per year. If it's Tuesday, he might be in Kabul where he led a historic power project in Afghanistan, and if it's Thursday, he may be somewhere in southeast Asia or Europe delivering a talk on water politics (his blog, Water Politics, is excellent), and yet he may be back by Monday to the US West coast where he is based. He travels more than a spy, so it's appropriate that he loves spy thrillers. When he is not immersed in non-fiction and history, he tells us is currently reading Red Widow by Alma Katsu and The Beirut Protocol by Joel C. Rosenberg.
Fellow traveler, fellow SAIS alum, insightful policy thinker, and president of Al-Monitor Andrew Parasiliti is reading about 7 books at once (a habit he says he still retains from graduate school!). Among the books he’s reading today that caught our eye: The World Beneath the Sands: The Golden Age of Egyptology by Toby Wilkinson, and Crosswinds: The Way of Saudi Arabia by Fouad Ajami.
Fellow traveler and researcher Rick Twelves is reading Roger Ford's Eden to Armageddon: World War I in the Middle East. He also recently discovered the classic "Al Resala" (The Message) on Netflix, and strongly recommends it as a masterclass in both epic filmmaking and Islamic storytelling. “The movie had an absolutely insane production, filming in the Moroccan and Libyan deserts while funded in part by Muammar al-Gaddafi!” he says).