News and Analysis: 1-15 July 2015 | EmergingFrontierMarkets.com

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Posted on Wed, 15 July 2015:

IMF threat to pull out of Greek bailout challenges Germany, Reuters, 15 July 15:
The IMF's threat to pull out of bailouts for Greece unless European partners grant Athens massive debt relief poses a stark challenge to Germany, the biggest creditor, which insists on IMF involvement in any future rescue. The global lender has made itself unpopular with both sides in the Greek debt saga by playing its role as a teller of inconvenient truths (Secret IMF report - Greece needs debt relief far beyond EU plans)

Larry Summers: Complacency and incrementalism are traps to avoid, FT, 12 July 15 [courtesy Harvard]:
Tolstoy once observed that all happy families are alike but each unhappy family is miserable in its own way. In the same way, each of these situations (in Greece, China and the US) is driven by its own dynamics. But their concatenation does warrant reflection on some common lessons for financial policy makers and their political masters. Two stand out, writes Pres Obama's fmr Nat'l Econ Council head / Harvard prof

Coffee/Tea Room: Mixing business and pleasure - The problem with city travel rankings, Brookings (blog), by Z Neal, 29 June 15:
Have you ever traveled to a city for biz one time, and for pleasure another? If so, there's a good chance that your experiences were completely different with each visit, esp. if you never even left the hotel during your biz trip. The fundamental difference between biz and pleasure traveling comes to mind with the recent release of the Global Destinations Cities Index, which ranks cities by the number of overnight int'l visitors

Posted on Mon, 13 July 2015:

Has the IMF made mistakes in Greece?, Australian Financial Review, by J Kehoe, 4 July 15 [via Ctr Int'l Governance Innov]:
A provocative question is being whispered inside the IMF's HQ and furiously debated in int'l economy policy circles. Has the venerable IMF stuffed up the Greece debt crisis? On 2 July, the IMF said Greece needs €52 bil. of extra funds over the next 3 years and large-scale debt relief. Whatever the outcome in Greece over the coming weeks, a probe of the IMF's leadership on the debt saga over the past 5 years reveals a series of mistakes

Olivier Blanchard: The IMF's response to criticism of its Greek program, IMF (blog), 10 July 15 [via WEForum (blog)]:
Since all eyes are on Greece, I thought some reflections on the main criticisms could be of help. The main criticisms are: 1) The 2010 program only served to increase debt and demanded excessive fiscal adjustment; 2) The financing was used to repay foreign banks; 3) Growth-killing structural reforms, together with fiscal austerity, have led to an econ depression; and 4) Creditors have learned nothing and keep repeating the same mistakes, writes IMF chief economist

Charles Kenny: Addis Ababa - Getting beyond aid, Ctr Global Dev't (blog), 7 July 15:
Unusually for the UN, there is just one goal for the 3rd International Conference on Financing for Development that opens in Addis Ababa, Ethiopia, on 13 July. Admittedly it is a big ask. Member states must outline how the world will deliver on the incredibly ambitious dev't agenda outlined in the draft Sustainable Development Goals (SDGs): 169 UN targets for progress by 2030, writes Ctr senior fellow

Posted on Fri, 10 July 2015:

Why Greece and Europe should avoid Grexit - An Open Letter by 26 academics at Lond Sch Econ, 9 July 15 [PDF, via den Haan's site]:
The consequences of Greece leaving the eurozone are highly uncertain and could very well be detrimental to both Greece and the eurozone. To avoid Grexit, it is essential that both the creditors and the Greek gov't act in an economically responsible manner. The 1st priority for everybody should be to get the Greek economy on a sustainable growth path, signed by Profs. Berglof, Burgess, Caselli, Goodhart, Hajivassiliou, Leape, Pissarides, and 19 others

Anders Borg: The crack in the BRICS, World Economic Forum (blog), 9 July 15:
The 7th BRICS summit in Russia is taking place now in a chillier atmosphere than that of the last 6 summits. Growth in China is slowing and both Brazil and Russia are likely to contract this year. India is doing better, but the climate change is obvious. Russia, Brazil and SAfrica are facing deeper challenges while India and China are pushing forward and embracing structural reforms, writes WEF global fin system initiative chair / fmr Swedish fin minister

The world's emerging middle class - 6 key takeaways, by R Kochar, Pew Research Center, 8 July 15:
During the first decade of this century, the world experienced a dramatic drop in the number of people living in poverty and a significant rise in the number who could be considered middle income, according to a new Pew Research Ctr report. But the majority of the global population remains low income. Our analysis includes 111 nations, which accounted for 88% of the global pop. in 2011, writes Ctr assoc res dir

Posted on Wed, 8 July 2015:

China stock market freezing up as sell-off gathers pace, Reuters, 8 July 15:
China's tumbling stock market showed signs of seizing up on Wed., as companies scrambled to escape the rout by having their shares suspended, and indexes plunged after the securities regulator warned of 'panic sentiment' gripping investors. For some global investors, the fear that China's market turmoil will destabilize the real economy is now a bigger risk than the crisis in Greece (China's stock market boom and bust, Money and Banking [blog])

Poor economic planning and political confusion at root of Greece's woes - economist John Taylor, Stanford U News, 6 July 15:
The origins of the Greek debt crisis can be found in economic and political mistakes by that country as well as by the European financial community, says Stanford economist John Taylor. Greece's best strategy to its crisis would be to overhaul its economic policy to favor growth-oriented, business-friendly measures. The Greek economy is performing terribly by any measure. Looking back in time, there are 3 key factors that have led to this situation

Development financing conference next week to agree 'concrete' action on social protection, aid delivery, UN News, 7 July 15:
The 3rd Int'l Conference on Financing for Development next week in the Ethiopian capital, Addis Ababa, will be the 1st of three major global events taking place this year, followed by the Sep summit in NY for the adoption of a new set of sustainable development goals (SDGs) and a conference in Paris in Dec to reach a universal climate change agreement (Getting real about finance for development, Fin4Dev)

Posted on Mon, 6 July 2015:

Greek finance minister quits to smooth talks after thunderous 'No', Reuters, 6 July 15 [self-updating link]:
The sacrifice of the outspoken finance minister, after promising Greeks he would win a better deal within a day of their overwhelming referendum vote, suggested PM Tsipras is determined to try to reach a last-ditch compromise with European leaders. Greece's chief negotiator in aid talks with international creditors, Euclid Tsakalotos, a soft-spoken academic economist, is the frontrunner to become finance minister, a senior gov't official said

Can countries legislate to attract more investment?, World Bank (blog), by Nimac and Krajcovicova, 16 June 15:
The effectiveness of legislating to address investment policy shortcomings is a recurrent debate in development circles. Do countries need a singular investment law? Should govts expend the political capital required to put in place a law if the likelihood of its implementation is questionable from the outset? Is it not better to work on more implementation-focused activities?, ask WB Vienna office head; and investment policy specialist

Welcome to Nerdopolis, Univ Chicago, by A Merrick and N Gural, 31 May 15:
In the 19th century, cities in Europe drew unskilled, cheap labor from the countryside to operate the machinery in their burgeoning factories. In the 20th century, cities fostered the multinational corporations that encouraged the spread of global capitalism. This is the century of global cities as brain hubs. We take a look at how knowledge workers are reshaping the map of the global economy

Posted on Fri, 3 July 2015:

Jeffrey Sachs: A way out for Greece, Project Syndicate, 3 July 15:
The Greek crisis is a tragedy for the country and a danger for the world economy. Germany is demanding that Greece continue to service its debts in full, even though Greece is clearly broke and the IMF has noted the need for debt relief. I propose a four-step path out of the Greek crisis. First, I recommend that the Greek people give a resounding 'No' to the creditors in the referendum on Sun., writes Columbia U Earth Inst dir

Daniel Gros: Why Greeks might accept more austerity in Sunday's vote, HuffPost, 1 July 15:
The one key difference between Argentina in 2001-02 and Greece today is political: in Argentina the hard peg to the dollar was a project of the elite, which had never been popular. By contrast, in Greece, it seems that support for euro zone membership, even if the price is austerity, is stronger among the population than the present gov't, writes Ctr European Policy Studies dir

Solar Impulse - One giant leap for green energy, Smithsonian Air&Space, 2 July 15:
As the US East Coast enjoyed a lazy Sun. afternoon on 28 June, an airplane took off from Nagoya, Japan, without any gas aboard. Four days later it's still in the air with its pilot and lone occupant, proceeding across the Pacific Ocean to Hawaii. By flying all the way around the planet without a single drop of gas, its team hopes to prove the practicality of solar power, and so jolt the world into noticing that batteries really can be useful (Solarimpulse.com)

Posted on Wed, 1 July 2015:

Despite Lagarde's initial reluctance, IMF on the hook for Greece, Reuters, 30 June 15 [via Ctr Int'l Governance Innov]:
By its own admission, IMF broke many of its rules in lending to Greece. It ended up endorsing austerity measures proposed by the European Commission and European Central Bank. That the IMF lent to Greece at the behest of Europe may expose the institution to greater scrutiny, esp. as it has $24 bil. in loans outstanding to Greece in its largest-ever program. Lagarde's tenure as the IMF head will now be shaped by Greece

Anil Kashyap: A primer on the Greek Crisis - the things you need to know from the start until now, Univ Chicago, 29 June 15 [PDF]:
What should have been done to avert this crisis? Greece should have defaulted in 2010. Its debt burden then was unsustainable and nothing since then has changed this. The money that was raised to pay off the creditors could have been diverted to support Greece. Imagine how different the political dynamics would have been if the German & French banks had been explicitly bailed out, writes U Chic prof who teaches 'analytics of financial crisis' / Swedish cenbank advisor and Italian cenbank's Inst Ec & Fin board member

WB chief economist sets up new commission on global poverty, World Bank, 22 June 15:
The Bank's Kaushik Basu announced the launch of a new commission to report on the best ways to measure and monitor poverty around the world and help the WB achieve its twin goals of eradicating chronic extreme poverty and boosting shared prosperity. The new body, made up of 24 leading int'l economists, will be chaired by Sir Anthony Atkinson of the London Sch Econ and Oxford, a leading authority on the measurement of poverty/inequality

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