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September 2000

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  • Conversation in Kazkakhstan in recent months has centred on one topic: oil. What appears to be a major new find has excited locals, multinationals operating in the energy sector and buyers of an oversubscribed sovereign Eurobond. The prospect of this impoverished country, where the average wage is barely $100 a month, becoming the next Kuwait has also enabled the nation teasingly to play prospective bride to both the West and Russia. Ted Kim reports
  • To date, most Arab countries have been insulated from outside pressure due to highly protected markets and huge oil reserves. But foreign competition is set to increase, especially for markets joining the World Trade Organization. The biggest banks in small countries will have to look outside their domestic markets for growth, either through acquisitions or alliances. Darren Stubing reports
  • There's a lot of hot air in Khartoum, and according to one lawyer working for Talisman Energy, the Canadian oil explorer, not all of it is blowing in from the Sahara. "Well, if you include planting date trees along the roads adjacent to the Nile - well yes, I suppose the infrastructure is improving." He pauses: "Oh wait, they died. Nobody watered them." The taxi driver swerves to miss a huge pothole in the main road and then quickly veers back into the street in an attempt to avoid those sleeping on the footpaths.
  • At the Golden Tiger (U Zlateho Tigra) in the back streets of old Prague on a Sunday in midsummer there are no tourists. The schoolroom benches along the back wall resound to the din of Czech voices, leaving no space for the casual visitor to squeeze in.
  • The policy team of new Mexican president Vicente Fox has thought of everything. An impressive set of reforms covering the central bank, capital markets, the fiscal deficit, the energy sector and judiciary are all laid out ready. But can they be got through congress and made to work free from interference and corruption? Mexico is facing one of the biggest make or break periods in its history, writes Andrea Mandel-Campbell
  • Information technology is by far India’s most dynamic sector but its success comes despite rather than because of government initiative. The BJP government has sloughed off the Congress Party’s socialism but is desperately slow at implementing its objectives of privatizing and increasing foreign investment. There’s some hope, though, in the initiatives being taken by state governments. Kala Rao reports
  • Bankers and their regulators converging on Prague for the IMF/World Bank meetings this month should be nervous about the vulnerability of the world financial system to attack - not by aliens, hackers or international terrorists but by the shortcomings of thousands of interdependent institutions. Highly correlated and linked financial markets mean contagion can spread in seconds. Short of rebuilding national barriers, like electronic iron curtains, there's no way to isolate ourselves from contamination. The reforming countries of central and eastern Europe and the former Soviet Union are a weak link. They need more help and example from the west. Bringing in foreign strategic investors isn't a panacea, as the following pages show.
  • Forewarned is Forearmed: or How to survive in some of the riskiest business travel destinations in the world
  • China’s economy continues its fast growth and its leaders appear firmly committed to continuing reform, as the country prepares for entry into WTO which may attract further substantial foreign direct investment. But the past 20 years of reform have been comparatively easy, having been imposed by an all-powerful central government on a closed economy. Now China must begin to compete globally and to cope with political tension at home arising from the uneven distribution of the benefits of reform. Phillip Moore reports
  • The economic boom of recent years has created a large class of wealthy individuals with money to spare. These high-net-worth individuals now form the most enticing target market for fund managers. Meanwhile the internet is democratizing financial services, in the process opening the markets up to a swathe of new private investors. The pile-it-high, sell-it-cheap supermarket philosophy which has already swept through the US is now set to engulf the rest of the world. What does this mean for the markets? Julian Marshall reports
  • Brazil looks set to meet fiscal targets agreed with the IMF and also seems to have inflation under control. But fiscal discipline has rested on increasing revenues rather than cutting expenditure, a course that will eventually restrain rather than promote growth. Reform of the tax and welfare system has barely been tackled and doubts persist about whether the government has enough political clout to see it through. A key gain is that the real economy is moving out of stagnation and into growth. Jonathan Wheatley reports
  • In the heartland of Gotham and the Bay Area of San Francisco, dwarfed by the high-rise headquarters of those they seek to challenge, lurk a select few individuals waiting to strike. These men are behind the mutant companies seeking to change the dynamics of equity capital-raising forever. They are much smaller than their prey, but less weighed down by legacy systems. The time has come for the internet-based new issue houses to show what they can do, reports Antony Currie
  • After the BJP-led coalition came to power last year, prime minister Vajpayee set up a new department of disinvestment and placed a young, telegenic lawyer, Arun Jaitley in charge.
  • The boom in yen-denominated bond issuance looks likely to be sustained. Foreign corporates are coming to the samurai market because they need yen funds, not because they intend to swap into dollars. There’s also strong demand for emerging market sovereign bonds from Japanese investors starved of yield by low domestic interest rates. Anja Helk reports
  • Independent market regulation and a more relaxed approach to foreign investment are among new policies setting Arab states on the road to more dynamic markets. Not before time – accession to the World Trade Organization means the doors will have to open to foreign competition.
  • As the huge conglomerates that have long dominated Germany's economy transform themselves into sleek, focused businesses, a procession of corporate assets has come to the market.
  • The "Turn Prague into Seattle" slogan has been pinned to thousands of protesters' T-shirts, websites have been set up, and accommodation organized months ago. The protesting community has prepared well for the 55th annual IMF/World Bank meetings from September 19 to 28.
  • With the recent launch of the London based internet site, European corporates accustomed to hedging against Financial risk should be able to manage another great uncertainty - weather - just as American corporates have been able to do since 1997 through weather derivatives.
  • Having so far failed to set European investment management alight, Morgan Stanley's asset-management business is making a new push in the institutional market.
  • Head of investment banking, Barclays Capital Americas
  • Governor of the Central Bank of Bosnia and Herzegovina
  • As bankers, policymakers and pundits packed their bags in readiness to travel to Prague for the IMF/World Bank conference, the Czech Republic's most (in)famous Financier was making no such arrangements. Viktor Kozeny, aka the pirate of Prague or the bouncing Czech, will be 5,000 miles away, sitting out proceedings in the comfort of his Bahamas home.
  • If a market is mature when its founders move on, the Czech Republic has Finally come of age. Richard Wood was one of the First expatriates to arrive in Prague after the fall of the Berlin Wall and built from scratch the internationally respected stockbroking Firm Wood&Co. But ever alert to the prospects for exciting times and doing business, Wood has recently moved to Istanbul.
  • The increasing pace of developments in both the syndicated loan and the debt capital markets
  • We are not quite at the end of the current equity market correction. The next few months may be volatile or downright violent. But I'd start buying into any downturn in US and European stocks right now - particularly in traditional economy sectors where smart management can apply cyber-magic to the benefit of shareholders.
  • Ever on the look-out for new and lucrative corners of the capital markets, many firms have identified what is often called capital management as a promising niche. At its most respectable, this business consists of advising banks and other companies on how to measure and manage the true economic risks of their activities. More often than not, however, it is about cold-calling bank treasurers and trying to sell them ideas for complex deals. Michael Peterson reports
  • Traditional institutional fund management no longer holds much appeal for Prudential. Earlier this year the UK insurer sold off its pension fund equity business - some £11.5 billion ($18.5 billion) of assets under management - because it was not turning enough profit.
  • After the fanfare of the meeting between chairman Kim Jong-Il and president Kim Dae-Jung in Pyongyang in mid-year, moves toward a closer relationship have been slow. North Korea’s Tokyo-based unofficial spokesman, Kim Myong-Chol, has predicted peaceful reunification of Korea within five years. It might happen. But the road to unity will be longer and harder than was the path to German unification, finds Kevin Rafferty
  • At some point the government plans to privatize the Hong Kong Airports Authority, and is expected to give it more attention once it has sold off the Mass Transit Railway Corporation (MTRC).
  • Securitizing whole companies may be seen as the future of securitization in Europe, but so far only a few examples of this technique have taken place – and most of them have been in the UK pub industry. What is it about UK drinking dens that makes them so suitable for securitization?