Page 7 - bne magazine March 2017 issue

bne March 2017 The Month That Was I 7
Economics
Central Europe
Czech GDP growth disappointed in the final quarter of 2016 as it slowed to 1.7% y/y, preliminary data showed. Quarterly growth sagged to just 0.2%, matching the weakness of the third quarter.
at 98bp over mid-swaps. The issue replaced a 20-year placement from May as the Baltic state’s longest maturity bond.
Southeast Europe
The International Monetary Fund put its loan agreement with Bosnia & Herzegovina on hold as the country has failed to implement reforms it had agreed with the fund.
Eurasia
Mongolia reached a $5.5bn bailout agreement with the IMF in February. The deal was reached just weeks before the country’s development bank faces a repayment deadline on a $580mn bond.
Kazakhstan’s economy grew 1% in 2016 and it is forecast to grow 2.5% in 2017, a visiting IMF mission said. The slight slowdown from 2015’s 1.2% growth reflected the oil price decline. Growth was originally expected by Astana to slow to 0.5% in 2016, but it was boosted by the launch of the giant Kashagan oilfield and funding for infra- structure, small businesses and housing.
Poland’s GDP grew 2.8% in 2016,
the slowest expansion in three years,
a preliminary estimate showed. The result was 0.1pp above consensus as an upward revision in the fourth quarter knocked aside extremely pessimistic forecasts, but the sluggish performance remains a worry for a government that is betting on strong growth to fund populist spending programmes.
Lithuanian GDP surprised to the upside as it finished 2016 with growth reaching 2.2%, according to a first esti- mate released by Statistics Lithuania.
Turkey’s current account deficit fell by 16% y/y to $4.2bn in December. The current account shortfall, the economy’s Achilles’ heel, was thus $32.6bn last year versus $32.1bn in 2015.
Eastern Europe
The Russian port industry continued to grow last year despite the stagna- tion of the economy. The sector handled 722mn tonnes in 2016, up 7% y/y, benefitting from better exports, which account for 80% of volumes.
Foreign direct investment (FDI) in the Russian economy last year grew 62% to $19bn, according to the United Nations Conference on
Trade and Development. However, the increase was mainly attributed to the dubious $11bn partial privatisation
of state-owned oil company Rosneft.
Slovak GDP growth fell to its lowest of the year in the fourth quarter of 2016 as it slowed to 3.1% y/y. The prelimi- nary result leaves the full-year economic expansion on target at 3.3%.
Latvia issued its first 30-year sover- eign bond, a €500mn issue maturing in February 2047 which was launched
Kazakh consumer price inflation slowed to 7.9% y/y in January from the 14.4% a year earlier, in line with central bank expectations. The bank expects inflation to moderate further to 5-7% in 2018 and 4-6% in 2019.
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