The newsletter first reports some overarching good news – world trade is rebounding strongly from the trough it fell into in the nine months to March.
Better still, protectionism, a phenomenon that so aggravated the Great Depression of the 1930s, seems to be under control.
"True, so-called trade remedy investigations are up 50% in the September quarter over a year before, as countries move to protect their hard-pressed industries from import competition through safeguard and anti-dumping measures and the like," says EFIC's chief economist, Roger Donnelly.
"But by and large countries have been relying on multilateral trade rules and the measures they are introducing will arguably have only a marginal impact on trade flows."
Among the good news for companies doing business in emerging markets are:
- a new cabinet in Indonesia that promises to keep up the reform drive;
- a breakthrough agreement in Mongolia for the giant Oyu Tolgoi mine;
- a relaxation of controls on investment in Malaysia's car industry as part of a broader deregulation push.
The bad – or ambiguous – news this month comes from India, the Gulf, Fiji, Guinea and the Ukraine.
- In India, a growing anti-land acquisition movement and threat from ‘Naxalite’ communist revolutionaries are stalling billions of dollars of investment;
- In the Gulf, plans for monetary union have been put on the backburner and could be abandoned completely;
- In Fiji, relations between the government and Australia and New Zealand are going from bad to worse;
- In Guinea, a country with vast bauxite, iron ore and other mineral reserves, the military junta is facing sanctions after bloody suppression of an opposition protest.
- From the Ukraine, markets are demanding a 1000 basis points premium on benchmark bonds to compensate for the risk of default.
