Emerging Markets

Frontier Markets Monthly Wrap

Frontier Markets Monthly Wrap

Covax delays cast a dark cloud

Extended delays to vaccine supply from India to the Covax facility will keep rollout in many Frontier Markets stuck in first gear. Social distancing measures will have to stay in place for longer, holding back economic recoveries, and the risk of renewed outbreaks and new variants will persist.

21 May 2021

Frontier Markets Monthly Wrap

SDR allocation no panacea for distressed frontiers

A fresh allocation of IMF Special Drawing Rights (SDRs), if implemented, would provide a welcome boost to the depleted foreign exchange reserves of some distressed frontier economies. But an allocation wouldn’t address underlying dire debt dynamics, notably in Ecuador, Sri Lanka, Ethiopia and Zambia.

3 March 2021

Frontier Markets Monthly Wrap

On the “vaccine boost” to frontier economies

Frontier economies will receive only a relatively small direct economic boost from the roll-out of vaccines next year. But the indirect benefits via higher commodity prices, capital inflows and tourism spending will be more substantial. These indirect benefits should help to ease external vulnerabilities in a number of fragile frontiers.

15 December 2020
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Frontier Markets Monthly Wrap

New debt relief plans face major hurdles

Zambia became the first African government to default during the current crisis and debt risks are high in several other Frontier Markets, including Ghana and Kenya. The G20’s recently-announced ‘Common Framework’ to provide debt relief is a step in the right direction, but we fear it may not gain as much traction as many hope.

23 November 2020

Frontier Markets Monthly Wrap

Debt talks at an impasse

Hopes for more debt relief for distressed EMs have been dampened in recent weeks. This Frontier Markets Monthly looks at why we are now at an impasse, the role of China, which EMs need help most, and how things might play out from here.

27 October 2020

Frontier Markets Monthly Wrap

The latest on sovereign debt restructurings

Recent moves by Angola and Zambia to restructure their public debts (or seek to) are unlikely to act as a trigger for a wave of similar steps by other debt-distressed frontiers. Indeed, their experience highlights the difficulties of reaching agreements with China and private bondholders. What’s more, we suspect that some of the recent debt restructurings in frontiers may not restore debt sustainability.

Frontier Markets Monthly Wrap

Debt restructurings: lessons from Argentina & Ecuador

Argentina and Ecuador’s swift debt restructuring deals may provide a blueprint for other debt-distressed sovereigns. But these deals are not quite the success stories they seem at first sight. In any case, no two restructurings are ever alike, and other distressed sovereigns will face some different obstacles.

Frontier Markets Monthly Wrap

A closer look at frontier dollar bond issuance

A handful of frontier market governments have issued Eurobonds over the past few months, but these could create vulnerabilities further down the line, particularly in Egypt, Ukraine and Bahrain. Moreover, many frontiers remain locked out of global capital markets and/or in the midst of crises.

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