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BRAZIL

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Genetically Modified Crops’ Technology Struggles to Keep Promises in Brazil

Brazil, one of the world’s leading developers of genetically modified crops (also known as GMCs, Transgenics, or Biotech Crops), stands divided over rising cultivation of GMCs. The proponents of GM technology believe that the country’s tropical and humid climate makes the crops particularly vulnerable to pests and that adoption of the GM technology is the only way to make these crops resistant to such unfavorable conditions. Others contend that GM technology has failed to produce expected results, and in turn has given rise to mutated species of pests and weed that are more resistant to agrochemicals.

1-Genetically Modified Crops


2-Economic Benefits Shrink

EOS Perspective

Brazilian farmers are known to be extremely price-sensitive when it comes to seeds and agrochemicals. This steered extensive adoption of GMCs cultivation as it promised better yield with limited need for agrochemicals. Rapid adoption of GMCs cultivation and increased yield suggest that GM technology has indeed been beneficial to the Brazilian agricultural industry in the past two decades. However, rising incidence of GMCs deterioration in the past 3-4 years elevates concerns over economic viability of such crops cultivation in the coming years.

With GM seeds being protected by patents, their prices have soared over the years. Moreover, as the technology is developed only by a handful of multinationals, GM seeds command high prices owing to the dominance of only few companies in the industry. The emergence of herbicide-resistant weed and mutated species of pests add to the total costs for farmers, thereby reducing their profit margin even further.3-Leading Biotech Companies

Declining profitability of GMCs cultivation is raising demand for non-GMCs cultivation. However, the monopolized seed industry is making it difficult for farmers to get hold of non-GM seeds. For instance, in 2010, Monsanto, one of the leading companies in Brazilian seed market, introduced an 85/15 rule, which allowed farmers to buy only 15% non-GM seeds, while the other 85% had to be GM seeds.

Cultivation of non-GMCs require additional protection from genetic contamination spreading from GMCs. Adequate measures to check contamination of non-GMCs impose considerable additional costs and efforts for farmers, further discouraging them to adopt non-GMCs cultivation.

Genetic contamination of non-GMCs is an inevitable consequence of widespread GMCs cultivation, as phenomenon of pollination or scattering of GM seeds through wind is beyond the control of farmers. Despite taking necessary precautions, there has been increasing number of reports on genetic contamination of non-GMCs in Brazil.

Since 2005, in a bid to protect their intellectual property, Monsanto started performing tests on soybeans marketed as non-GM. If these tests uncovered Roundup Ready seeds (Monsanto’s patented technology), farmers were required to pay Monsanto a sum equivalent to 3% of their soybeans’ sales. Monsanto claimed that most Brazilian farmers used smuggled seeds, as a result of which the company was being deprived of revenue and this levy was the way to recover the company loss. But in several cases, farmers were forced to pay this penalty for having their fields contaminated with GMCs, with no fault on their own. However, in 2012, Brazilian court ruling deemed Monsanto’s penalty as unjustified.

Suppressed under the dominance of biotech multinationals, Brazilian farmers are more likely to rely on new variety of GMCs in the event of failure of the existing GMC technology. To seize the opportunity, biotech giants have already made plans to introduce new products in the Brazilian market. For instance, Germany-based BASF and Bayer are planning to introduce new GM soybean seeds in Brazil in 2016.

As Brazilian farmers have become too reliant on GM technology, going back to non-GMCs cultivation is rather difficult due to the widespread genetic contamination of crops and increasing control of biotech giants over Brazilian seed market.

by EOS Intelligence EOS Intelligence No Comments

Universal Healthcare Is Needed, but Isn’t Enough – Assessment of Public Health Insurance Targeted at Vulnerable Populations in South America

Ensuring an equal access to healthcare services that are affordable and of decent quality has increasingly been on the agenda of several developed as well as developing countries across the world. Throughout 2014 and 2015, we published a series of articles focusing on the South Asian region, in which we looked into various aspects of the universal healthcare in The Philippines, Cambodia, Vietnam, and Indonesia, followed by our final article in the series presenting holistic view on bridging the health insurance coverage gap in the region. But South Asia is not the only region working to achieve improvements in the functioning of healthcare systems and the universal health insurance coverage. In South America, where universal healthcare is more prevalent and public health insurance coverage gap is narrower than in most Asian nations, several countries have shown a range of approaches to enhance the equality to access and quality of services within their public healthcare. While the approaches differ, the common focus across the region has been to broaden the inclusion of particularly vulnerable groups of populations, such as the poor, elderly, and the unemployed. We are taking a look into public healthcare systems in selected countries to asses their strength in terms of catering to these beneficiaries.

As universal healthcare systems are unrolled and implemented to include large part of the country’s population, regardless of the geography, a well-functioning public health insurance system must focus on two important components: clear classification of its beneficiaries and appropriate structuring of the healthcare services financing.

In order to ensure the right terms of access to the public healthcare system, a country’s population that can benefit from such public insurance is typically segmented into various groups, such as the working population, grey economy workers, poor population, and the senior citizens. The strength of a public health insurance system lies in its ability to effectively target these various groups with dedicated plans and schemes, as these sections of the population may have different healthcare needs.

A public health insurance system is usually financed through government funding and contributions from the employed population (which apart from the formally-employed population can also include informal sector), with most of the public funding directed at subsidizing the healthcare for poor citizens and other underprivileged groups (depending on their proportion in total population). A system with specific coverage targeted at each of these groups is likely to be more efficient in terms of generating required finances, redistributing them according to beneficiary requirements, and in channeling healthcare resources.

South American countries are known for their inclination to provide or to work towards providing universal healthcare to their citizens. While the shared focus across the region has been to improve equity in access and financing of health services, in several cases leading to tangible positive health outcomes of the populations, public health insurance systems in most of these countries have evolved over a period of time to their current state through experimentation and deliberations over various policies to achieve a system that works best in the local scenario.

South American countries adopted various models to develop and enhance their public healthcare systems and, based on respective exigencies, their public health insurance systems are unique. Despite these differences, a broad level country comparison is possible on the basis of some common parameters, to evaluate how healthcare needs of key population groups are addressed in these countries. This comparison indicates the relative strength of public health insurance systems from the target beneficiaries’ point of view.

Comparative View of Public Health Insurance

Relative Strength of PHI


EOS Perspective

As South American example indicates, the development and implementation of universal healthcare system is not a solution as such, but rather a first step to ensure that healthcare needs of all population groups, especially the vulnerable ones, are well taken care of. Universal healthcare systems with no dedicated, targeted programs oriented specifically at certain groups in terms of type and availability of services, provisions and procedures, access to healthcare facilities, and assigned funding, are likely to be able to address needs of these groups only to a limited extend.

From beneficiary’s point of view, this results in unavailability of certain health services, lower trust in the system, and might simply lead to negative health outcomes of these populations. Given their limited financial abilities, these beneficiaries are unlikely to turn to private sector where their healthcare needs would be met (unless private insurance players, looking to fill gaps, with or without government collaboration, are able to provide cost-effective health insurance coverage, again targeted specifically at these groups).

by EOS Intelligence EOS Intelligence No Comments

Brazil’s Personal Care and Cosmetics Market: Transitioning from Physical to Digital?

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Brazil’s personal care and cosmetics market is skyrocketing with growing sales driven by a fashion-conscious and beauty-obsessed population. Brazil, the cosmetics industry veteran, is the third largest consumer of beauty products worldwide and relies heavily on traditional channels for distribution. Online retailing has made inroads into the personal care market in Brazil and is on a slow but steady growth trajectory with immense potential in the future.

Brazilian consumers have long exhibited strong interest in personal care and beauty products, mostly purchased through traditional distribution channels. Over the past couple of years, these consumers have gradually also begun shopping for beauty products online, however, they are still skeptical about payment security as well as delayed delivery and quality of products.

Brazil’s Personal Care and Cosmetics Market-1

 

 

Despite the obstacles, some online retailers — such as Natura, Men’s Market, and BelezaNaWeb — have stepped up to overcome hurdles and develop robust strategies to initiate online purchase of personal care products. After realizing potential of online retailing in the personal care and cosmetics segment, investors have started pouring in money in e-commerce websites to reap benefits.

Brazil’s Personal Care and Cosmetics Market-2

 

Personal care segment can benefit from numerous growth opportunities in the e-commerce market with consumers’ rising inclination towards special offers attracting them to shop online, beauty product segment’s growing share in the emerging online shopping market, m-commerce boosting online sales, etc. E-retailers should exploit these opportunities to penetrate the market and improve sales.

Brazil’s Personal Care and Cosmetics Market-3

 

Brazil’s Personal Care and Cosmetics Market-4

EOS Perspective

While the e-commerce industry faces various obstacles, a robust online strategy along with a balanced eco-system — comprising fraud protection arrangement, better payment mechanism, developed infrastructure, as well as clear understanding of consumer behavior — is likely to improve e-commerce adoption and increase sales.

The market is slowly overcoming some of the hurdles — to combat logistics issue, government has started investing in air and shipping ports to facilitate parcel deliveries through these modes. This is likely to improve shipment timelines and consumers, as desired, can avail quick delivery of personal care products. Further, online retailers have started assessing consumer behavior and responded by improving shopping experience by re-designing websites, launching m-commerce applications for convenient mobile browsing, and implementing loyalty programs. The Brazilian government is working towards implementing stringent regulations to protect consumers against online frauds and formulating robust e-commerce policies.

Paving way into the Brazilian e-commerce market to sell personal care products has been challenging, however, with improvement initiatives slowly gaining momentum, the market is on an upswing to witness a stellar growth.

by EOS Intelligence EOS Intelligence No Comments

Emerging Markets Take Vehicle Safety Standards Seriously (At least on Paper)!

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The article was first published in Automotive World’s Q3 2015 Megatrends Magazine

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Across emerging and frontier markets, most car buyers have generally focused on pricing, maintenance cost, and fuel economy, thereby ignoring the very important aspect of safety. The governments in these countries have also not given due importance to this aspect, as basic safety features such as air bags and ABS are not compulsory as per regulations. Taking advantage of this nonchalance of both customers and governments, OEMs have for long compromised on safety features, which are a critical part of all cars sold in developed markets.

In recent years, however, with customers becoming more aware and global safety organizations cajoling for higher safety standards, some emerging countries have introduced increased safety measures, which in turn will require significant changes in the cars sold by leading OEMs. While this is expected to affect the bottom-line of OEMs in these price-sensitive markets, not abiding to the changing environment is likely to prove equally costly, if not in the immediate term, but surely over the medium-to-long term.

Existing Safety Standards

Among the key emerging and frontier markets, vehicle safety standards in South Korea match the levels in Europe, while China has also shown immense progress in adopting the standard safety requirements in automobiles. But other developing countries, such as Mexico, India, and Brazil, lie far behind. As per current car safety standards, Mr. David Ward, Secretary General, GNCAP (Global New Car Assessment Programme) rates China-7, Brazil-5, and India-3 on a scale of 10. “This rating is based on three key factors – the state of legislation, level of penetration of different technologies in the market place, and consumer awareness levels.” However, with India and Brazil initiating the implementation of several safety-standards in recent months, they are likely to match global standards at least for crash testing. Crash prevention, on the other hands, continues to be a long term goal.

It was a big blow to India, when GNCAP conducted tests on some of its most popular entry-level variants (Maruti Suzuki Alto 800, Hyundai i10, Ford Figo, Volkswagen Polo, Tata Nano, Maruti Swift, and Datsun Go) and awarded zero-star adult-protection rating to all of them. This, in addition to having the highest number of road fatalities globally, instigated the government to commit to introducing regulations for mandatory safety standards. As per new regulations, by October 2017, all new cars will be required to pass frontal and side crash tests, whereas the deadline for new versions of existing models would be extended to October 2019. To pass this test, cars will need to have reasonable body shell strength and be equipped with airbags and other standard safety features. For conducting the test, the government plans to develop two crash test facilities, which are expected to come online in 2015/2016. In addition, the authorities plan to launch its own NCAP. India is also creating a vehicle recall policy, which will encompass testing for manufacturing defects. However, this legislation is yet to be passed.

As safety standards gain priority in India, it is a cause of concern for car manufacturers in the country, which have for long focused on only pricing and fuel efficiency in the market. From the manufacturing infrastructure and technology front, OEMs may not require many changes to adapt to these proposed changes in safety standards. This is primarily because most car models do offer basic safety features (such as airbags and ABS) in their higher variants and they also use India as major export hub for their cars destined for Europe and the US. However, this will definitely erode a fraction of the bottom-line for car manufacturers as India is an extremely price sensitive market. Moreover, a large portion of the audience in the country is not very mature and still does not put a high value to the safety factor, thereby restricting the price tag carmakers can attach for these features.

“The first reaction of the OEMs is that they are not very happy, since it will make their cars more expensive. But in the longer term, they will adapt to it as they have done in other countries. People will become aware and ask for safety. OEMs focus will be to meet the safety standards at affordable prices. For example, child support restraints are not made in India and are imported. OEMs can ask the government for concessions on these imports.” says Rohit Baluja, Director, Institute of Road Traffic Education, India.

Several leading OEMs have criticized the government’s call to boost safety standards in India. An engineer working with a leading car manufacturer in India stated, “At this moment, there are no talks about any changes being introduced to the body. These matters are handled at a very strategic level. Nothing has been discussed on this aspect as of now. In India, safety can’t really become a USP right now. Price is and will continue to remain the main selling point. If we talk about metro cities, the demand for frontal airbags has increased. So yes safety has become more important. But this is the case in metro cities only.”

It also seems that the government has succumbed to pressure from the OEMs and has softened down several of the safety standards. As per the regulations, India will be following China’s footsteps and introducing crash testing at a speed of 56km/hour instead of 64km/hour, which is followed globally (while China started testing at 56km/hour in 2006, it also increased its speed from 56km/hour to 64km/hour in 2011). Moreover, the authorities plan to conduct only ‘head impact’ tests for Indian pedestrians against the ‘head and leg impact’ norms adopted by Euro NCAP. It has further slashed the requirement for the use of child dummies for some side impact tests, which is a global standard. Decisions regarding mandatory safety belt alarm, child alert alarm, pre-tensioners, and airbags are also pending.

While several leading OEMs, have not been very supportive of the Indian government’s decision of mandatory crash tests, the ones which have preemptively incorporated these features in their cars have been the winners. Toyota, which made airbags mandatory in all its models in October 2014 in India, has seen sales surge by 34% between October 2014 and April 2015. Volkswagen, which also made airbags a standard feature in all its Polo hatchbacks, has seen the sales of its entry-level variant rise, since the decision was made in February 2014. Post its poor performance in the crash test held by GNAP, Nissan Motors has also worked on strengthening the body shell of its Datsun Go by using higher-grade steel (having a tensile level of 520 mega pascal compared with the earlier 320 mega pascal) and adding side beams on both sides to enhance the strength and rigidity of the vehicles.

Thus the way forward definitely begins with OEMs embracing the introduced changes. It is not incorrect to say that the consumers continue to be price sensitive, but that is because they are not well informed about safety. Thus, to see an actual shift towards safety, both the government and car manufacturers have to work together in changing the mindset of the consumer and promoting vehicle safety as an equally important factor in purchase decisions.

“It’s a shared responsibility of government and manufacturers to inform the consumers and move the market forward. Our project of testing cars has also helped build awareness and get media attention. We will do more testing end this year and get results beginning next year. The combination of government action on regulation, the response of individual manufacturers and the work done by NCAP will improve the whole situation in India.” says Mr. Ward of GNCAP

Brazil has a similar story, where the cheapest models of few most selling cars, such as Volkswagen Gol Trend, Fiat Palio, Chevrolet Celta, Ford KA, Peugeot 207, and Fiat Novo Uno, received only 1 star when crash tested by Latin-NCAP. Moreover, Chinese car, Geely was awarded zero stars in a similar test. This was underpinned by the absence of basic safety features such as airbags, lack of body reinforcements, lower-quality steel, weaker weld spots to support the vehicles, and outdated designs of car platforms. As a result of this, the Brazilian government mandated air bags and anti brake locking systems on all cars in 2014. Like India, this regulation faced much criticism from automakers and was at the verge of being postponed as it leads to an increase in the prices of basic models and also results in a layover of several employees in the case of few models being discontinued. However, the government pushed ahead with the regulations as decided, but offered lower import tariffs for key safety equipment to subdue the expected price rise.

In addition, the government is considering making electronic stability control a standard in all cars; however, it is still in the future. Moreover, the government plans to launch a US$50 million independent crash test center by 2017. While the center is expected to run as a government body, OEMs may provide part of the funding for its operation and even use the center; this raises concerns regarding the autonomous working of the lab. Moreover, since the regulations lack a ‘conformity of production’ clause (which requires automobile safety performance to be spot checked for the entire time the model is produced), the car models are only required to meet the crash test requirements once. Companies can also send a car of their choosing. These factors further may compromise on the credibility of the testing.

The Case of China

Unlike India and Brazil, the upgradations in China’s vehicle safety standards are stemmed from the country’s CNAP (China’s New Car Assessment Programme) initiatives. While the Chinese government has only mandated the use of seat belts and frontal airbags, the number of airbags in vehicles in China is reaching the same level as in Europe and the US. This is primarily due to the aggressive promotion of CNCAP’s safety assessment by the Chinese government, which has encouraged the country’s population to value car safety as an important aspect. “We undertake a lot of promotional initiatives such as advertisement and highway hoardings to promote safety features among consumers. This has really helped in making consumers aware regarding the importance of safety.” says Mr. Guo from CNAP. Furthermore, CNCAP has upgraded its test protocols to match its European counterpart and is expected to be at par with their standards by 2018. CNCAP has also started focusing on accident research and plans to include a test for pedestrian protection in future vehicles. It has also been considering including test scenarios for automatic emergency braking systems that will further help mitigate pedestrian collisions.

Even in case of China, the pricing of the vehicles increased with the addition of safety features but the entire price is not passed down to the consumers, especially in the base-level cars.

However, one of the key reasons why China has upped its vehicle safety standards is to build a good reputation for exports. As Chinese cars gain traction due to competitive pricing and design, they suffer a poor reputation when it comes to quality. Thus, they have consciously increased focus on safety norms to meet global standards. While they are on the right lines, they still have a long way to go in achieving global standards with regards to safety.

Safety-Standard Levels across the Major Emerging Automotive Markets

Safety-Standard Levels across the Major Emerging Automotive Markets

Thus, as safety-standards improve across emerging markets, the onus now lies on OEMs to adapt to these changes. While this will definitely impact the bottom line of the companies, it also presents an opportunity for the carmakers to gain a strong market foothold by offering these safety-features at a minimal pricing. Moreover, although these changes are happening primarily in India and Brazil right now, companies must be prepared for similar regulations to come in Mexico and other Latin American countries in the coming years.

Apart from crash testing standards, there are a lot of talks going on regarding crash prevention technology, the most important being electronic stability control (ESC). While, this has already become a standard in several countries, such as Australia, Canada, EU, Israel, Japan, South Korea, the Russian Federation, Turkey, and the USA, the Global NCAP is working towards making ESC a mandate in all cars manufactured by 2020. “Our overall priority is to ensure that all passenger cars, irrespective of where they are produced, must have the appropriate minimum crash test standards and the most important crash prevention technology (i.e. ESC) by 2020. To achieve this, the most important countries to act are China, India, and Brazil.” states Mr. Ward. With crash test standards becoming a ‘standard’ also among key emerging markets, the introduction of ESC also does not seem far from reality. In fact, Brazil and China have already begun considering making it mandatory. The OEMs that anticipate this and work towards it will have an advantage.

While it has taken several key emerging and frontier automotive markets time to realise the importance of vehicle safety, both for drivers and passengers, and for other people on roads, it is a welcome change with governments introducing several policy measures in recent months to bring about this change. The implementation of regulations and the variation in standards that exists across these markets is a cause of concern, and aspects that OEMs might use to their advantage by bypassing certain global standards. It is important that consumers also make it a point to make safety a priority when purchasing a vehicle, which would force OEMs to ensure that global standards are also followed in emerging and frontier markets. Brazil, China, India must lead the way, and demonstrate that it is possible to make safety a standard, so that OEMs follow this as a standard operating procedure across other emerging and frontier markets.

by EOS Intelligence EOS Intelligence No Comments

Biofuels: From Crest to Trough?

For the past decade biofuels have been contemplated as a sustainable source of energy that could alleviate global warming problems. The biofuel industry has experienced rapid growth driven by strong government support resulting in policy mandates and subsidies. However, the bucolic scenario of biofuels may soon be overshadowed considering the ecological toll on farm land and food crops from its production. The question still remains if we are ready to imperil food crops to grow energy crops.

The biofuel buzz sparked in the 2000s when several governments across the world offered subsidized ethanol and biodiesel to make it cost competitive with gasoline and diesel, and investors acquired lands to produce feedstock, particularly in emerging economies.

Biofuels are promoted as alternatives to fossil fuels, however, it seems that this green energy facade is impinging on our food and environment needs. Turning plants into fuel or electricity comes across as an inefficient strategy to meet the global energy demand. Irresponsible farming practices — to grow corn to suffice biofuel needs — in countries such as the USA are likely to result in adverse temperature and precipitation conditions due to climatic changes that will shrink corn and wheat yields in coming 10-20 years.

Biofuel development certainly creates employment opportunities in economies, improves vehicle performance, and reduces dependence on crude oil imports. However, this comes at the expense of higher food prices as biofuels compete with food production by using crops and lands. Moreover, biofuel production does not generally result in reduced greenhouse gases, as emissions still occur causing pollution.

Further, biofuels are less cost effective than fossil fuels. For example, biomass costs about 20% more than coal. Also, biofuels have lower energy content as compared with fossil fuels, which allows vehicles running on biofuels to travel shorter distances than on the same amount of fossil fuel. The energy content of biodiesel is approximately 90% of petroleum, while ethanol is 50% that of gasoline. Consequently, travelers would require higher amount of fuel, if running on biofuels, which will increase their expenditures. With the government laws supporting blending of ethanol in petroleum, motorists in the UK (for example) are likely to pay about £460 million annually due to higher fuel cost at pumps and lower energy content of biofuels.

While the disadvantages of biofuels has been widely known, in the past couple of years, bioethanol and biodiesel production has grown rapidly in several countries, supported by various policies and government subsidies. Currently, some of the leading biofuel producing countries include the USA, Brazil, and Argentina. It is interesting to look at the socio-economic and ecological impact of biofuel production on these countries.

Impact of Biofuels on Top Producing Countries
Biofuels


A Final Word

To choose biofuels over fossil fuels is like entering into a race between food versus fuel. Countries such as the USA use 40% of corn harvest for fuels — devoting farmlands to energy needs instead of feeding people. With crude oil extinction almost 10 million years away, it is quite inappropriate to contaminate environment to yield economic benefits from biofuels. Biofuels have not lived up to the expectation and have ceased to provide lower carbon footprint, as they cause indirect emissions by ruining the farming land and vegetation. At a time, when demand for land is likely to grow 70% by 2050 to meet global food demands, it is highly wasteful to use the same land to suffice energy needs.

In April 2015, Renewable Energy Directive of the EU announced a cap of 7% on the contribution of food crops in biofuel production. Such initiatives will help to sustain a balance in food supply chain. In order to establish appropriate carbon footprint accounting, the European Commission has approved indirect emissions to be considered as part of a holistic picture of biofuel harmful effects. Moreover, the European Commission is likely to prohibit the use of first generation biofuel post 2020.

So, what’s the alternative to biofuels, or at least another source of energy that is more sustainable?

A sustainable solution to the problem could be clean renewable fuels like cellulosic ethanol, which is manufactured from inedible parts of plants. Greenhouse gas emissions from cellulosic ethanol are 86% lower than from petroleum sources. Companies such as DuPont are investing to build bio-refineries to manufacture cellulosic ethanol. The refinery is located in Nevada, USA and will produce 30 million gallons of cellulosic ethanol annually after commencing operations in 2016. Other avenues such as energy efficient batteries, fuel cells, and solar and wind energy for powering vehicles and factories should also be pursued. Companies such as Tesla, a US-based automotive and energy storage company, have made groundbreaking progress in manufacturing low-cost solar powered batteries that discharge to generate electricity for homes, businesses, and utilities. Solar and wind energy investments are at an all-time high, both across advanced and emerging markets.

Perhaps, the need of the hour is for governments to look at diverse sources of renewable energy as a whole, and invest in a way that is most effective and sustainable for the economies and the environment. Clearly, biofuels (as was perhaps once expected) is not the ideal solution to global energy needs.

by EOS Intelligence EOS Intelligence No Comments

2014 FIFA World Cup Brazil – A Squandered Opportunity

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After 7 years of preparations, Brazil hosted the most expensive FIFA World Cup in 2014 at a cost that totaled billions of dollars. What is the associated outcome of spending huge sums on World Cup preparation? Did the investment leave any positive legacy for the country? What is the economic impact of hosting the World Cup on Brazil?

Investment and Associated Outcome

Investment in projects considered essential to hosting World Cup in 2014 varied across a range of sectors and had different impact on each of them. Around US$12.9 billion were invested in numerous projects focused on urban mobility, airports, stadiums, tourism, ports, telecommunication, and security between 2007 and 2013.

World Cup-related Investment By Sector, Brazil

Urban Mobility

Brazil has been struggling with overcrowded urban transportation systems for years. The insufficient public systems, paired with Brazilians’ growing financial capabilities, resulted in an increase in personal vehicles use, which in turn triggered chaotic and congested traffic conditions across Brazil’s major cities. 2014 World Cup investments planned in relation to urban mobility were expected to leave positive legacy for the country and to improve transportation systems in metropolitan cities easing traffic problems. But, several delays (caused by corruption, financing problems, etc.) were observed in execution of the planned urban mobility projects during 2007-2012, long before the event. Furthermore, as the World Cup neared, the government’s focus transferred to stadium construction works, as six out of the proposed twelve stadiums for 2014 World Cup still remained incomplete a year before the tournament. According to Responsibility Matrix 2013, investments dedicated to urban mobility projects were cut down to US$4 billion from US$6.6 billion anticipated in 2010. Some 21 of 53 projects planned in 2010 were discarded from the Matrix in 2013. Transformative advancements in transit infrastructure were expected to be the most beneficial outcome from hosting the mega sporting event. But with time, the priorities for government changed, and many of the ambitious projects never took off, as was the case with the proposed project for building high speed train linking Rio and Sao Paulo that was never executed.

Moreover, as the required urban mobility projects remained unfinished during the tournament, government declared holidays in schools and businesses on game days to ease traffic congestion. In June 2014, Sao Paulo State Federation of Commerce, a representative of 155 trade and business unions, estimated that the cost of lost productivity and overtime pay for businesses that remained inoperative during games would be around US$5 billion.

Furthermore, experts allege that these urban mobility projects were approved hastily without giving much thought to long-term benefits, which represents an intangible opportunity cost. For instance, some of the host cities, such as Sao Paulo, Manaus, Salvador, and Porto Alegre, were not allotted any investments in transport infrastructure. In most host cities, the mobility projects were limited to Bus Rapid Transit lines and there were no plans to invest in light rail, metro, or ferry lines.

Airports

An estimated investment of US$3.9 billion was designated to airports, out of which US$2.9 billion were contributed by private sources. These investments led to a noticeable improvement in airport infrastructure and facilities. An assessment report, published in July 2014, by President Dilma Rousseff and the Minister of Civil Aviation Moreira Franco indicated that around 16.7 million passengers used airport services in Brazil during the tournament. In addition, annual passenger capacity at airports increased by 52% over 2013 capacity level, reaching 67 million passengers per year. Between 2007 and 2014, aircraft yards were increased by 1,360 m², passenger terminals were increased by 350,000 m² and 54 new boarding gates as well as 10,300 parking slots were built. Modernized infrastructure and increased capacity will remain as positive legacy for the country.

Stadiums

Between 2007 and 2014, Brazil constructed five new stadiums, renovated five stadiums, and demolished and rebuilt two stadiums for 2014 World Cup. The estimated cost of construction and renovation of the proposed twelve stadiums for hosting 2014 World Cup game increased to US$3.5 billion, up from US$1.2 billion projected in 2007. Public opinion was outraged at these inflated costs, especially that they were paired with un-kept promises once given by the government representatives. After winning the bid to host the World Cup in October 2007, the former Sports Minister Orlando Silva promised, “There won’t be one cent of public money used to build stadiums”. However, according to Responsibility Matrix 2013, the contribution by private sources for building and refurbishing stadiums stood only at US$61.3 million, so majority of the costs were borne by federal investments and state and municipal governments. Another issue associated with the construction of large stadiums is its effect on urban real estate. Each newly built facility is spread across around 15 to 20 acres of urban land, making the space unavailable for any other, perhaps more productive, purposes. It is likely to also continue to negatively affect the real estate prices, especially, as urban land is scarce in Brazil.

Post 2014 World Cup, some cities, which received large stadiums built specifically for the tournament at capacities far exceeding local, every-day needs, are struggling to make these facilities economically viable. In particular, the stadiums built in Manaus, Natal, Cuiaba, and Brasilia appear to be under the fear of turning into ‘white elephants’. These cities have football teams playing in Brazil’s third-fourth division championships, which are not expected to attract the audience at volumes close to the stadiums’ capacities. Moreover, if government fails to find private sponsors for these stadiums, hefty maintenance costs will have to be paid from public funds. The newly built US$325 million stadium in Manaus alone is expected to demand US$3 million for annual maintenance.

Security

In June 2013, mass protests were held across the country during Confederation Cup, a warm-up tournament organized by FIFA to test stadiums, transportation, and security before 2014 World Cup, to express frustration over exorbitant spending by government on World Cup while Brazil still struggled with below par standards of healthcare and education. The protests turned violent with police crackdown and arrests. Following the event, Brazil’s government became alert and tightened up the security measures for the 2014 World Cup to ensure safety of the visitors. 177,000 security personnel were deployed during the tournament and US$900 million were invested in security structures, equipment, and training. Such high spending on security might not have been required if the government had addressed the problems of the country’s citizens in time, or at least had exhibited more understanding attitude to these sensitive in nature social problems.

Ports

Around US$322 million were invested in ports. With more than 90% of trade in Brazil routed through ports in 2012, ports are an important medium for international trade in the country. However, the funds allotment for improvement of ports under the header of World Cup-related investment remained limited as the sector was not assumed to directly impact the event. Between 2007 and 2013, funds were mainly used for modernization of port terminals at Salvador, Fortaleza, and Natal.

Telecommunication

During 2007-2013, around US$200 million were invested in improvement and expansion of telecommunication infrastructure in association with World Cup in Brazil. In order to connect the host stadiums and other official venues of the tournament, a 15,000 km long optical fiber network was installed that enabled to handle 166 terabytes of data during the World Cup. Furthermore, 15,012 mobile antennas were installed across the host cities. A report released post 2014 World Cup by SindiTelebrasil, a national union of telephone companies in Brazil, indicated that the telecommunication networks in the country were successful in handling large traffic volumes during the event. For instance, during the World Cup final match, held on July 13, 2014, between Germany and Argentina, the telecommunication networks managed high traffic volume of around to 2.6 million photos, which is equivalent 1,430 gigabytes of data.

Tourism

Post 2014 World Cup, President Dilma Rousseff announced that one million foreign tourists visited the country and three million Brazilian tourists travelled around the country during the event. Around 3.4 million people bought tickets to attend matches at the stadiums. Fan Fests attracted another five million people. By mid-June 2014, a total of 340,000 daily hotel bookings were recorded.

According to data released by Brazil Central Bank in July 2014, international visitors spent US$797 million in Brazil in the month of June 2014. Higher revenues from spending by international tourists in Brazil and reduced foreign trips by Brazilians during 2014 World Cup contributed in improvement of international travel account of services trade, which posted a deficit of US$1.2 billion in June 2014, down 17.3% from June 2013, providing some cushion to current account deficit. Economists believe that current account deficit over 5% of gross domestic product may lead to currency crisis in Brazil involving difficulty in debt repayments and currency depreciation. The twelve-month current account deficit remained stable at 3.6% of gross domestic product in June 2014, at the same level as in August 2013, because of narrowed gap in international travel account of services trade.

A survey conducted by Getúlio Vargas Foundation (FGV) and the Foundation Institute of Economic Research (FIPE), conducted by interviewing 6,627 foreign visitors and 6,038 Brazilians during the World Cup indicated that about a million tourists from 203 different countries came to Brazil during the tournament. Foreign visitors stayed in the country for an average of 13 days and visited 378 Brazilian municipalities. Thus, the event offered an opportunity for the country to promote its less popular tourist destinations to a group of diverse visitors. Furthermore, the survey suggests that 95% of the visitors expressed the desire to revisit, which might indicate brighter days for tourism industry in the future, provided that these tourists actually come back.

A Rocky Road to the Event

A look into World Cup-related investment across these sectors reveals that there have been mixed repercussions of the event across social and economy spheres. However, on a broader level, the planning, preparation, and organization of the event were challenged by a range of problems, which led to lost opportunities or even negative outcomes, and questioned the overall benefit of organizing 2014 World Cup by Brazil.

Increased Costs and Delays

In 2007, Carlos Langoni, then Finance Director of the 2014 World Cup Local Organizing Committee and former President of the Brazil Central Bank, estimated the World Cup-related cost at US$6 billion. In January 2010, Sports Ministry revised the estimates to around US$11 billion. According to the Responsibility Matrix 2013, the estimated actual expenditure was US$13 billion.

The increase in costs is believed to be partially attributed to the rampant political corruption in Brazil. By analyzing Brazil’s electoral data and government audit reports from 2007 to 2013, The Associated Press reported many-fold increase in campaign contributions to the political parties by the construction firms that were awarded most World Cup projects. This is suspected to have been a form of a bribe to win Word Cup-related projects and later allowed these companies to make huge profits by indulging into unfair practices such as fraudulent billing, under-compensation to workers, etc. For instance, Andrade Gutierrez, a construction conglomerate that got large contracts associated with World Cup, increased its political contributions to US$37.1 million in 2012 from US$73,180 in 2008. Adding to the suspicion of possible political linkage of the construction firms involved in World Cup-related projects, in 2014, Contas Abertas, a watchdog group that scrutinizes Brazilian government budgets, alleged that some contracts were awarded directly to the chosen construction firms and were never made available for public bid. A government audit report on construction projects associated with World Cup, released in early 2014, highlights several instances of price-gouging and suspected misuse of financial linkages between the construction firms and government. For instance, Brasilia’s government failed to impose US$16 million fine on Andrade Gutierrez for a five-month delay in completion of the stadium in the city. However, no corruption charges have been filed yet on individuals or companies related to World Cup work.

Additionally, experts believe that the lacking capability of construction firms in project planning and management also contributed to rising costs and delays. Furthermore, in order to accelerate the construction work, ‘emergency’ contracts were awarded at a higher price to leading (and known to be influential) construction firms, waiving the normal contracts, which further led to inflated costs.

Overexploitation of Workers

Construction projects, especially the stadiums, which were left to last-minute completion, had adverse effect on the workers. Many workers were assigned twelve-hour shifts and were asked to give up holidays to finish the construction work in time for World Cup. Some workers reportedly lost their employment as they could no longer tolerate the stress and physical strain. Around eight workers died in accidents on construction sites and these accidents occurred mainly due to lack of safety measures and inhuman working conditions. Many workers that had migrated from rural parts of the country to urban areas in search of World Cup-related employment opportunities complained about poor working and living conditions and under-compensation. Between 2007 and 2014, workers in various parts of the country, supported by labor unions, went on strike demanding their basic rights. Strikes and accidents triggered further delay in construction work related to World Cup.

Projects Financing and Funds Clearance Issues

According to Responsibility Matrix 2013, 80% of the total investments in World Cup-related projects were financed through investments and funding from federal, state and municipal governments.

Source of Funds

A larger role from the private sector was anticipated in preparation for 2014 World Cup, particularly for the event-specific projects such as construction of stadiums, and the government was expected to contribute mainly as a facilitator for the event. As the actual contribution from private funding was limited, the strain was passed on to local government budgets. In 2010, on failure to attract private investments for building stadiums for World Cup, the National Bank for Economic and Social Development (BNDES) opened a credit line of US$2.7 billion for completion of the World Cup stadiums. After receiving requests from states for financing, BNDES took up to three months to analyze the proposals and consequently the stadium construction work was further delayed.

Furthermore, complex and time consuming procedures continued to cause delay in funds clearing. According to World Cup Transparency Portal, by March 2014, 89.9% project work had already been contracted out, but payments were done for only 51.2% of them. This was implying increased payments out of local governments’ pockets in the second quarter of 2014, which occurred at the expense of several high-importance sectors such as healthcare or education.

Roadblocks for Micro and Small Enterprise

Around 44,000 enterprises associated with Brazilian Service of Support for Micro and Small Enterprises (SEBRAE), a non-profit autonomous institution promoting competitiveness and sustainable development of micro and small enterprises, are estimated to have earned US$230 million in revenue from World Cup-generated business opportunities from 2007 to 2014, which indicates that several of them were able to take good advantage of the opportunities provided by the event. However, it appears that many small food and FIFA merchandise vendors could have benefited to a greater extent, if they were not deterred to capitalize on large demand generated in the close proximity of stadiums during World Cup by FIFA’s heavy fee of US$8,000 from any non-FIFA approved vendor who wished to operate in a 1.5 km radius of host stadiums. The question is whether such a considerable fee remains in proportion to small and micro vendors’ scale of operations, who after all distribute FIFA merchandize, contributing to the publicity success of the event.

Even the few selected street vendors (estimated at around 1,000) that were granted temporary licenses to sell FIFA sponsors’ goods in the FIFA prohibited zones during the World Cup were not much at advantage. FIFA sponsors were responsible for selecting, contracting, and training the vendors. Proven experience of the vendors in selling goods in the neighborhood was the main the criteria for selection. Vendors were provided with uniforms, authorization cards, as well as goods to sell. Vendors retained a fixed 30% share in revenue from goods sold during the event, which limited their ability to negotiate the profit margins. As these vendors were not allowed to sell goods from non-FIFA sponsors, they lost an opportunity of earning higher revenues by selling locally manufactured or self-produced goods.

Mass Eviction

Eviction of People from Host CitiesBetween 2007 and 2013, about 248,297 people were forced to leave their homes due to infrastructure work for the tournament. Social activists claimed that most of the designated areas for relocation were at far distances from former dwellings and were less developed. There have been complaints that the compensations offered by the government to people for relocation were unfair and insufficient.

For instance, in May 2014, AlJazeera reported that in Rio de Janerio compensation sums offered to people for relocation was half the value of their old house, while employment opportunities in relocated areas remain scarce. These people belong to most impoverished communities in Brazil and lack of work opportunities and inadequate compensation may further worsen their condition, which may also lead to increase in crime rate.

Tax Revenue Lost Opportunity

Brazil government was rather generous in giving out tax breaks in relation to various activities associated with 2014 World Cup, and this was considerable revenue lost for the budget. In 2010, the Ministry of Treasury announced tax breaks for the construction and renovation of the stadiums for World Cup. The entities involved in stadium works were granted exemption from Industrialized Products Tax, Importation Tax, or social contributions. In addition, the twelve host cities were granted exemption from State Value Added Tax on all operations involving merchandise and materials for construction or renovation of the stadiums. Furthermore, all expenditure by FIFA in Brazil for World Cup was exempted from taxation. While it is always expected that tax relieve and exemptions are given in such high-profile, national events, it remains doubtful whether Brazil could afford foregoing such tax revenue, especially in the face of many social, structural, and welfare problems eating away the country’s public system.

 

EOS Perspective

2014 World Cup is believed to have provided a boost to Brazil economy, but this push was not significant enough to upswing economy’s recently sluggish growth. The temporary rise in tourism associated with the event, can, to some extent, offset lowered production and disruptions in the country during the event. However, it is unlikely that gains from this short tournament will make up for the inflated and overrun costs, suspected political corruption, fraudulently spent or lost money, missed opportunities of diverting some of the funds to other sectors, or social damage caused by disregard for dwellers and workers, along with other social costs that follow these deficiencies in a ripple effect. World Cup-generated opportunities benefited mostly construction, hospitality, travel, and tourism sectors.

The improvements and modernization of infrastructure will leave positive legacy for the country, which is a positive outcome, however achieved at a great expense, arguably not comparable with the country’s current financial capabilities. As emotions cool down and more objective analyses are offered by various experts, it is more and more visible that the positive impact of the event on Brazil economy, its people, and businesses is rather short-lived. Over long term, it is likely that Brazil will end up being the loser of the 2014 FIFA World Cup. As the event-generated income sources slowly dry up, Brazil will be left with a huge bill to pay in its hand, one that will have to be settled over years to come.

by EOS Intelligence EOS Intelligence No Comments

A Dragon Unfurls its Wings – How China’s Economic Slowdown Is Rippling Through Emerging Markets

Almost 10 years ago, Goldman Sachs published a report, in which it predicted Chinese GDP to overtake the USA’s GDP by 2020. Today, this prognosis looks like a far-fetched dream as China has recently been riding a wild economic horse. When Chinese economy was growing, its demand for various products and services contributed to the economic growth of emerging markets across the world. The deteriorating performance of Chinese economy over the past few years appears to have started adversely affecting these markets. Will the emerging markets be able to successfully sustain in future?

China witnessed a spectacular and continued rise of its GDP during major part of last three decades. However, end of 2007 saw a turning point, and the country’s economic growth rate cooled off from 14.2% still in 2007 down to 9.6% in 2008, reaching mere 7.4% in the first quarter of 2014. This single digit growth would be more than satisfactory for a lot of economies. However, for China, which regularly recorded double digit rates, this extended period of slower growth is disappointing, with some calling it as ‘an end of an era’.

For years, China was enjoying relentless economic growth through massive investments, exemplary rise in exports, as well as abundance of labor force which was available at low wages. Due to these factors, economists started referring to China’s economic growth model as an investment-and-export driven model. This model has played a key role in driving exports also from emerging markets such as Latin America, Asia, and Middle East, as there was substantial demand for commodities from China’s end to support its domestic consumption as well as export requirements. With the weakening of foreign demand and internal consumption, China’s export demands have considerably weakened, leading to declining prices of export-related commodities and resulting in an adverse impact on emerging markets’ GDPs.

Is the Slowdown for Real?

China’s economic slowdown has not only been reflected in its modest GDP growth figures, but also in several other negative trends that have been observed. These include a continuous decline in the percentage of fixed-asset investments as a part of China’s GDP. Investments contracted from 24.8% in 2007 to 19.6% in 2013. Reduction of fixed-asset investments is likely to negatively contribute towards a country’s economic slowdown by adversely affecting sectors such as real estate, infrastructure, machinery, metals, and construction.GDP

Moreover, yuan has depreciated against US dollar (with average exchange rate of 7.9 in 2006 down to 6.26 in April 2014). In addition to this, Purchasing Managers’ Index (PMI), which is a composite index of sub-indicators (production level, new orders, supplier deliveries, inventories, and employment level), has plunged from 52.9 in 2006 to 48.3 in April 2014, below the middle value (50), thus indicating some contraction of China’s manufacturing industry. This industry contributes significantly to China’s GDP, therefore, the industry’s deterioration has a direct adverse effect on China’s economy.

This negative twist in China’s economic growth story is believed to be a result of a synergetic effect of various internal and external factors, some of which include:

  • Over-reliance on abundant supply of low-cost labor. For decades, China has based its growth on production of goods requiring high amount of cheap manual labor. However, as the economy continued growing, the demand for higher wages has increased, pumping up the labor cost. This cost is contributing to the inflation of products’ export prices, which is ultimately translating to a lower demand of Chinese goods.

  • The focus of Chinese workforce has been shifting from rural agriculture to urban manufacturing. The government has been taking steps to propel this transition in order to boost economic growth, prosperity, and industrialization. As more and more Chinese moved to urban areas, gradually, the transition has started yielding diminishing returns mainly due to saturation in the manufacturing industry.

  • Europe has also played a villainous role in China’s story. It has been one of China’s largest export markets but has recently been extending a significantly low demand for commodities and products from China. In 2007, the European Union accounted for 20.1% of all the exports from China. This percentage has fallen to 16.3% in 2012.

Chinese Leaders React

The Chinese government is in a reactive mode and has been unveiling a plethora of actions to bolster growth. The overall approach looks conservative in nature with a targeted GDP growth of 7.5% for this year, after recording a growth of 7.7% in 2013.

In an attempt to improve the situation, some of the expected financial and fiscal reforms are in the pipeline. Liberalizing bank deposit rates and relaxing entry barriers for private investment are some of the moves to be implemented by 2020. Various property measures (such as relaxing home purchase rules, providing tax subsidies, or cutting down payments) are planned to be introduced (based on local demands and conditions prevailing in a particular city) in order to balance the property market as a whole. A target of creating 10 million new jobs in Beijing has also been set for 2014. The underlying motive of all the rescue measures is strengthening the Chinese economy’s reliance on domestic consumption and services.

Influence on Emerging Markets

Undoubtedly, swing of the Chinese economy towards consumption and services is expected to considerably affect all the connected economies, several of them being emerging markets economies (EMEs). Commodity producing emerging markets such as Latin America, Middle East, parts of Africa and Asia are likely to be affected. Within this group, metal producers will probably suffer the most, as China had a significant demand for iron ore, steel, and copper during its investment boom phase. Within this subgroup, economies which are running current account deficits are forecast to be more susceptible to the ill-effects of China’s economic slowdown.

As China tilts towards domestic consumption, Latin America has started to witness a dawdling growth as the region’s growth rate dropped from an average of 4.3% in the period of 2004-2011 to 2.6% currently. For instance, as Chile depends heavily on copper exports to sustain its economic expansion, the country has been regularly reporting sluggish growth rates (5.8%, 5.9%, and 5.6% in 2010, 2011, and 2012, respectively) due to the decline in the price of copper, largely fueled by a lower demand from China. In addition to this, Brazil and Mexico are struggling to survive through falling benchmark stock indexes. The fall is mainly due to declining prices of commodities, as exports to China from Brazil and Mexico have weakened.

Middle East will probably register both positive and negative effects of China’s economic slowdown. One of the ill-effects could be reduction in oil prices, from US$140 per barrel in 2008 to approximately US$80 per barrel by the end of 2014, due to China’s lower demand of oil. On the positive side, Middle East is strengthening its position as an attractive region with long-term growth since China is being considered as a slightly less attractive option for investment by a majority of investors. This is mainly due to Middle East’s good infrastructure and accelerated development of industries such as defense, chemical, and automotive, and not only traditionally developed energy and petrochemicals.

The impact on African countries is expected to be negative primarily due to declining commodity prices. As Africa’s growth substantially depends on its exports to China, some African commodity exporters, such as Zambia, Sudan, and Angola, have started to feel the strain as China’s demand for commodities is weakening. This weakened demand has led to lower prices of commodities such as aluminum, copper, and oil, which registered a y-o-y decline by 4%, 9.5%, and 5.4%, respectively in January 2013. Zambia is likely to receive the strongest hit as copper constitutes almost 80% of the country’s total exports and reduction in copper prices could make its current account deficit to account for almost 4% of GDP in 2014.

Effect of China’s economic slowdown will vary from country to country in case of Asia. Countries such as Indonesia and Philippines, which have significant domestic demand, would be less adversely affected as they are less dependent on commodities exports to China. China’s unstable economy has spurred new investments in other growing Asian economies such as Cambodia. India is also likely to benefit from the ability to import oil at lower prices, which are pushed down by China’s weakened demand for oil. At the same time, however, export of cotton and metals such as copper and iron ore from India to China is dampened, adversely affecting India’s economy.

While EMEs have already been witnessing a lower demand from their traditional trading partners such as European Union and the USA, China’s slowdown will be an added burden to their economies.
China's Impact


It’s Touch and Go

It is rather evident that Chinese economic slowdown is having an adverse impact on emerging countries across Africa, Asia, and Latin America. One can hope that the measures taken by the Chinese leadership to curtail the slowdown will soon start taking effect and gradually lift up the economy, and in doing so, control the extent of damage spilling over many emerging countries and their economies.

In the event that the Chinese economy is unable to recover from this period of slowdown soon, it will continue to be a terrible blow to the economic ambitions of several emerging markets, especially those in Africa and parts of Asia-Pacific, which are heavily reliant on Chinese investment and trade relations.

Simultaneously to absorbing fewer production inputs imported from emerging countries, it is worth noting that China’s role in world economics might start to alter as it transforms to a consumption-led economy. This transformation is likely to slowly increase China’s appetite for imports of products and services, apart from traditional commodities-focused imports. It will be interesting to observe whether and how some of the emerging economies will attempt to satisfy this new Chinese hunger for goods extending beyond simple commodities.

by EOS Intelligence EOS Intelligence No Comments

Strike On Syria – Potential Impact On Emerging And Frontier Markets

Though there is still uncertainty of the US military action on Syria, global markets seem to have already given an indication of what could be in store if it actually happens. Crude oil prices rallied in the last week of August amid indication of strike, followed by a fall in oil futures, as the fear of imminent action receded. In another instance, share markets showed signs of panic due to a false alarm regarding missile attack on Syria (which eventually turned out to be an Israeli missile testing exercise).

The possible US strike on Syria has implications for global economy, and specifically for emerging economies, which are experiencing economic slowdown. The situation could be a tough test for countries such as India and Indonesia, as both of them struggle to keep trade-deficit under control, and are under the watch of credit rating agencies. For countries such as Brazil and Mexico, the US action may lead to delayed economic recovery. For Russia, being one of the largest oil producers, political implications are more than the economic one in case of a unilateral US action (i.e. without UN backing) on Syria.

While a sense of uncertainty and urgency prevail globally, we take a look at what potential impact the strike might have on select emerging and frontier markets.

Strike on Syria - Impact on Emerging Economies

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