Markets have hung their hopes on the upcoming 2019 election and the avoidance of a blowout at troubled state-owned utility Eskom as potential reasons for optimism in South Africa, but without a monumental shift in mindset, or an end to the factionalism that has increasingly defined the executive and the ANC, both reform and growth will remain elusive.
Dato' Lee Kok Kwan, Chairman of BIX Malaysia, the Bond and Sukuk Information Exchange Malaysia, spoke with Bonds & Loans about the sukuk pipeline for the coming year, growing demand for Sharia-compliant instruments, and Malaysia’s innovative approach to Islamic finance.
Last year, Grupo Bimbo’s debut hybrid transaction marked a milestone not just for the company but the broader Mexican corporate bond market, where primary market activity for hybrid securities has traditionally been dominated by select financial sector issuers.
Americas Market Intelligence’s John Price takes stock of last year’s hectic election cycle in Latin America and looks more closely at the fortunes of some of the region’s key markets: Brazil, Mexico and Venezuela.
Since their post-FOMC peak on January 31, both MSCI EM and MSCI EM FX have fallen. Virtually every EM currency has given up their post-FOMC gains, the lone exception being MYR (+0.2%). The worst performers have been ZAR (-6%), ARS (-3.3%), and TRY (-2.3%). This supports our belief that the liquidity and low US rates story is not enough to sustain the EM rally on its own. What’s still missing is an improved global outlook and we certainly didn’t get that with the US retail sales data.
Mexico has made significant strides in developing and deploying renewables in recent years, but recent regulatory uncertainty has cast a pall over the sector and may start to weigh on the bankability of transactions. Bonds & Loans speaks with Benny Villareal, Chief Executive Officer at Vive Energía about the company’s corporate funding strategy.
The recent announcement that Chinese government bonds (CGBs) and policy bank bonds will be included in the Bloomberg Barclay’s Global Aggregate (Global Agg) Index marks a huge milestone in China’s gradual integration into global markets. Not only does index inclusion herald the beginning of an influx of foreign investment, but it has the potential to mould credit markets across the region.
One of the biggest M&A deals in recent emerging market history, the Suzano-Fibria merger, saw a correspondingly complex and impressive financing scheme that involved a USD9bn syndication, split between a bridge loan and pre-export financing, which culminated in a billion-dollar bond issuance. The acquisition allowed to create a pulp giant with a 17% share of the global market.
How do telecom operators and governments shut down an entire country’s connectivity? In Africa, where is the risk highest in 2019? And, what is the commercial and economic impact of the shutdowns? EXX Africa's Robert Besseling provides the analysis.
EM FX ended the week mixed but gave up much of their post-FOMC gains as the week progressed. MYR, PHP, and MXN were the best EM performers for the week and posted small gains. ZAR, BRL, and ARS were the worst in EM, dropping nearly 2% against USD. US-China trade talks and Chinese data are likely to set the tone for EM this week. Reports that the US government may shut down again should weigh on risk assets.
- Deadly Pipeline Blast Adds Fire to Mexico’s Fuel Crisis
- Uncertain Global Outlook Highlights GCC Debt Opportunity
- Mexican Borrowers Clean Up at This Year’s Latin America Deals of the Year Awards
- Investec Targeting Senior Private and Illiquid Credit in South Africa When Sentiment Sours
- BBH: EM Preview for the Week Ahead