Discover more from Emerging World
Emerging Markets Daily - March 19
Global Economy To Rebound Robustly: UN, Didi Accelerates IPO, China Buys More Iran and Venezuela Oil, Saudi Stocks Under Pressure, Tanzania President Dies
Global Economy to Recover Strongly, Grow 4.7% This Year, UN Says
“The global economy is set to grow by 4.7per cent this year thanks to a stronger-than-expected recovery in the United States, a report by the UN Conference on Trade and Development (UNCTAD) said on Thursday (Mar 18), revising up its previous forecast of 4.3 per cent.”
“The upwards revision from its previous forecast made last September factors in an expected boost in US consumer spending on the back of progress distributing COVID-19 vaccines and a vast stimulus package, the report said.”
"‘The global recovery that began in the third quarter of 2020 is expected to continue through 2021, albeit with a good deal of unevenness and unpredictability, reflecting epidemiological, policy and coordination uncertainties,’ the report said.”
“Earlier this month, the OECD also revised higher its growth forecast for this year to 5.6 per cent from 4.2 per cent. However, the 22-page UNCTAD report called 'Out of the frying pan ... into the fire?' said COVID-19 will have lasting economic consequences that will require continued government support. It said the main risk to the global outlook is a ‘misguided return to austerity.’” Channel News Asia reports.
Didi Accelerates IPO, Targets $62 Billion+ Valuation
“Chinese ride-hailing giant Didi Chuxing Technology Co. is accelerating plans for an initial public offering to as early as next quarter to capitalize on a post-pandemic turnaround, people familiar with its plans said.”
“Didi, the largest investment in SoftBank Group Corp.’s portfolio, is targeting a valuation above the $62 billion it secured during its last funding round, the people said, asking not to be identified discussing an internal matter. The company moved up plans from a previous target of late 2021 after its Uber-like car-hailing business bounced back with China’s success in bringing Covid-19 under control.”
“Based on a common 15% float for mega IPOs in Hong Kong, one potential venue, Didi could raise roughly $9 billion in what would be one of the largest tech debuts globally in 2021. The company hasn’t made a final decision on the listing location, one person said. Didi’s plans remain preliminary and the timing could still slip till later in the year depending on negotiations.”
“An IPO would cap a remarkable turnaround for a company that ran afoul of first regulators and then Covid 19. It hopes to tap the same investor enthusiasm that propelled tech debuts this year from China’s video service Kuaishou Technology to South Korean e-commerce pioneer Coupang Inc.”
“‘Didi wants to capitalize on the red-hot market for China IPOs,’ said Brock Silvers, chief investment officer at Hong Kong-based private equity fund Kaiyuan Capital.” Bloomberg reports.
Geopolitics: In Test for Biden, China Buys More Venezuela, Iran Oil
“China has sharply increased its imports of oil from Iran and Venezuela in a challenge to two Biden administration foreign-policy priorities, according to U.S. officials, undermining key diplomatic leverage Washington needs to restart long-stalled negotiations.”
“China is expected to import 918,000 barrels a day from Iran in March, which would be the highest volume since a full U.S. oil embargo was imposed against Tehran two years ago, according to commodities-data company Kpler.”
“That trend is confirmed by other shipping trackers, some of which see those sales at 1 million barrels a day. ‘If it sells 1 million barrels a day at current prices, Iran has no incentive to negotiate,’ said Sara Vakhshouri, president of Washington-based SVB Energy International and an expert on Iran’s oil industry.”
“President Biden’s administration has sought to engage with Iran to return to a 2015 nuclear deal that was exited by his predecessor, former President Donald Trump. But Tehran has rebuffed the overtures so far.”
“China’s oil purchases from Venezuela, where the U.S. has been trying to use sanctions to pressure the Maduro regime into holding credible democratic elections, also are growing, according to London financial data provider Refinitiv.” The Wall Street Journal reports.
Saudi Stocks Under Pressure On Worries About Oil Demand, Covid
“Saudi stocks underperformed on Thursday under pressure from key lenders and petrochemical makers as oil traded on the backfoot amid rising US crude inventories and fears that a new wave of virus infections could dampen demand recovery.”
“Saudi Arabia's benchmark index headed lower by 1.2 per cent to close at 9,486 points. Oil prices sustained their downward trend for a fifth straight session, stoking worries for investors in the world's largest oil exporter.”
“Al Rajhi Bank, National Commercial Bank and Samba Financial Group along with Advanced Petrochemical and Sabic pulled the index lower, while oil giant Saudi Aramco shed 0.9 per cent ahead of its full-year results on coming Sunday,” Gulf News reports.
Tanzanian President, Long a Covid Denier, Dies Possibly of Covid
“Tanzanian President John Magufuli, one of the continent’s most high-profile Covid-19 deniers, has died in hospital in Dar es Salaam, according to the government, plunging the East African nation into uncertainty. He was 61.”
“Vice President Samia Suluhu Hassan confirmed Magufuli’s death after weeks of rumours that he had left the country for Covid-19 treatment, ascribing it to heart complications. According to Tanzania’s constitution, Hassan will be sworn in as the new president and will serve the remainder of Magufuli’s five-year team, which began last year.”
“Magufuli’s death leaves a huge void in Tanzania’s political landscape. One of Africa’s most controversial leaders, Magufuli refused to accept the severity of Covid-19, insisting for months that his country was unaffected by the global pandemic. He implemented almost no preventative measures to protect the population and joked about the disease.”
“The government has neglected to track coronavirus cases, so there are no reliable figures on the virus’s spread or death toll. But reports in recent weeks suggested a surge in hospital patients suffering from respiratory distress. A recent spate of deaths attributed to pneumonia has been reported by citizens on social media and referenced in parliament by a governing MP, and several high profile politicians have succumbed to the disease.” African Business reports.
What We’re Reading, Hearing (Overhearing) and Watching
The world has been full of protest this past decade. The SAIS Review of International Affairs, the student-edited academic journal that gathers some of the top thinkers on world affairs as contributors, has just launched an excellent issue on our decade of global protest. Check it out here, at the “The Revolution Will Be Televised": A Decade of Global Protest.”Well done, SAIS Review editors.
Is the China Debt Trap a Real Thing? Cobus Van Staden, co-host of the excellent China in Africa Podcast (a must-listen) doesn’t think so, but he also notes that, “like a vampire that just won’t die, we keep burying it, but it keeps rising from the coffin.” An excellent piece on the real story of the China Debt Trap. And while you’re at it, follow our Emerging World ‘fellow traveler’ and China in Africa co-host Eric Olanderon Twitter, LinkedIn, or wherever you get your social media (he’s super sharp), and subscribe to his China in Africa Brief. It’s very well-reported and written and expanding to the broader emerging markets and South-South story as well.
Watch the ever brilliant Hannah Ryder, CEO of Development Reimagined, talk about how African countries should approach China: Hint, develop a strategy and declare your priorities. It’s a 4 minute video and well worth watching.
The Syria War has produced many villains, and a few heroes. Lina Sergie Attar, founder of The Karam Foundation, is one of the heroes. We’re reading her moving essay in Newlines Magazine “When Assad’s End Comes”, where she writes: “I dream of my country where no Syrian child or person will ever be forced to answer one name and stand under one portrait out of fear. I dream of a classroom with 100 Syrian children who are asked, ‘Who is the hope for the future of Syria?’ Each of them will stand and answer — without doubt or hesitation or fear and with all the pride we were never allowed to feel — ‘I am.’”
Journalists like Arwa Damon, Anthony Shadid (may he rest in peace), Kareem Shaheen and so many other ‘nameless’ fathers, mothers, sisters, and brothers (more to come on them) are also heroes. I read brother Kassem Eid’s book last year and have enjoyed many an evening in his company. He is truly a hero. This week, we’re reading Arwa Damon’s and Kareem Shaheen’s powerful commentaries on Syria - Arwa’s piece, Kareem’s piece.
We’re also just reading Newlines magazine in general - a powerful new addition to the Middle East political analysis and reportage world. In case you missed it, Newlines also published this moving essay reckoning with the “The Arab Spring” by the lyrical and erudite Hisham Melhem.
Fellow traveler Kamran Bokhari also just published an important essay in the Wall Street Journal entitled The Hole in Biden’s China Strategy: Central Asia.
And I have not yet read, but look forward to reading my SAIS colleague Kent Calder’s newest book, Global Political Cities. If you are familiar with Kent’s superb work on Japan, S. Korea, East Asia, the New Silk Road, Middle East-Asia energy ties, Singapore and more, you know that his latest offering will likely explore a vital contemporary trend through the lens of history, politics, economics, and commerce (more on his book later).