Turkey and Argentina will undergo sharp contractions in the coming quarters as economic growth decelerates across advanced and emerging market economies, Moody’s Investors Service said in a report published yesterday.
As monetary tightening in major economies and geopolitical trade disputes continue to undermine investment globally, Moody’s is taking an increasingly dim view of the growth prospects of emerging markets like Turkey and Argentina, which “have relatively high exposures to external financing and [are] therefore the most vulnerable,” it said.
Turkey’s economy would likely contract through the first half of next year as the lira’s slump and rising borrowing costs take their toll on the economy, the rating provider said.
The Argentine economy would not return to positive growth until 2020, due to severe monetary and fiscal consolidation under an IMF program, it said.
Turkey’s inflation is hovering near the fastest pace since Turkish President Recep Tayyip Erdogan was first elected 15 years ago, and high borrowing costs are clouding the investment outlook.
“Double-digit inflation, a steep increase in borrowing costs and curtailed bank lending are likely to weigh on household purchasing power, private consumption” and investment, Moody’s said.
Moody’s said it expects Turkish inflation to remain at double digits through 2020 on unanchored inflation expectations spurred by exchange rate and oil price pressures.
Turkey’s inflation last month accelerated to 25.2 percent as the weak lira continued to fuel price gains.
Inflation expectations in Argentina continue to rise despite the central bank’s very tight stance and it will take some time before the benefits of a new monetary framework fully materialize, Moody’s said, adding that it expects inflation to gradually fall to 20 percent by the end of 2020.
Moody’s said it sees Turkey’s economy growing 1.5 percent this year and contracting 2 percent the following year.
It forecast that Argentina’s economy would contract 2.5 percent this year and 1.5 percent next year.
Stephen Garrett, a 27-year-old graduate student, always thought he would study in China, but first the country’s restrictive COVID-19 policies made it nearly impossible and now he has other concerns. The cost is one deterrent, but Garrett is more worried about restrictions on academic freedom and the personal risk of being stranded in China. He is not alone. Only about 700 American students are studying at Chinese universities, down from a peak of nearly 25,000 a decade ago, while there are nearly 300,000 Chinese students at US schools. Some young Americans are discouraged from investing their time in China by what they see
MAJOR DROP: CEO Tim Cook, who is visiting Hanoi, pledged the firm was committed to Vietnam after its smartphone shipments declined 9.6% annually in the first quarter Apple Inc yesterday said it would increase spending on suppliers in Vietnam, a key production hub, as CEO Tim Cook arrived in the country for a two-day visit. The iPhone maker announced the news in a statement on its Web site, but gave no details of how much it would spend or where the money would go. Cook is expected to meet programmers, content creators and students during his visit, online newspaper VnExpress reported. The visit comes as US President Joe Biden’s administration seeks to ramp up Vietnam’s role in the global tech supply chain to reduce the US’ dependence on China. Images on
Taiwan Transport and Storage Corp (TTS, 台灣通運倉儲) yesterday unveiled its first electric tractor unit — manufactured by Volvo Trucks — in a ceremony in Taipei, and said the unit would soon be used to transport cement produced by Taiwan Cement Corp (TCC, 台灣水泥). Both TTS and TCC belong to TCC International Holdings Ltd (台泥國際集團). With the electric tractor unit, the Taipei-based cement firm would become the first in Taiwan to use electric vehicles to transport construction materials. TTS chairman Koo Kung-yi (辜公怡), Volvo Trucks vice president of sales and marketing Johan Selven, TCC president Roman Cheng (程耀輝) and Taikoo Motors Group
New apartments in Taiwan’s major cities are getting smaller, while old apartments are increasingly occupied by older people, many of whom live alone, government data showed. The phenomenon has to do with sharpening unaffordable property prices and an aging population, property brokers said. Apartments with one bedroom that are two years old or older have gained a noticeable presence in the nation’s six special municipalities as well as Hsinchu county and city in the past five years, Evertrust Rehouse Co (永慶房產集團) found, citing data from the government’s real-price transaction platform. In Taipei, apartments with one bedroom accounted for 19 percent of deals last