Source: www.breakingviews.com is Europe's leading financial commentary service

National Bank of Kazakhstan's governor, Grigori Marchenko, won't say it, but he has been the main influence behind his country's widely acclaimed economic success story.

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With Islamic banking business growing faster than more conventional financial services, competition to provide new products is heating up.

As the world biggest buyer of emerging-market debt, Pimco's Mohamed El-Erian feels free to lean on banks - cajoling them into not selling new issues to hedge funds, refusing to be bumped into upsized deals and undermining issues that look set to damage his fund's investments.

The bulk of corporate earnings results for the second quarter of 2003 from S&P500 companies are now in and equity bulls are claiming that they justify the sharp equity rally since mid-March. I'm not convinced. More companies beat analysts' expectations, but then estimates had been revised down sharply.

Russia's richest businessmen have set themselves a new objective - the acquisition of foreign enterprises for pleasure, profit and expertise.

An embarrassing and potentially damaging controversy is emerging in Islamic equity funds. Because of the way the vast majority have been handled by mainstream brokers, many may not be as Shariah-compliant as investing customers would expect.

Kazakhstan

A cabinet reshuffle should revive Saudi Arabia's economic reforms, with a new capital market law pending.

It has been a gloomy year so far for the Philippines, a nation mired in corruption whose administration recently faced a mutiny by disaffected soldiers. But a recent court ruling against one of former dictator Ferdinand Marcos's closest allies may offer a glimmer of hope that this country can save itself after all.

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A new capital markets law, continued privatization and an eventual opening up to foreign investors should boost Saudi Arabia's equity market.

With inflation falling in Brazil, the days when banks could grow fat on government paper are almost over. New business lines, consolidation and retrenchment are high on the agenda and there are persistent rumours that Citibank will beef up its presence in Latin America's biggest economy.

After two years' frantic activity and expenditure banks are still struggling to understand, let alone control, terrorist financing. Governments have failed to support the financial community with resources, skills and systems. The implications for global security are alarming.

Five years after Russia defaulted on its sovereign debt, burning foreign investors, the government is poised to return to international capital markets next year with $2.76 billion of Eurobond issues. Thanks to the country's revival, investors are salivating at the prospect of fresh Russian paper.

Banking talent is always newsworthy, especially when it is unearthed in a dimly lit bar and involves Elvis renditions. The bar, in London's Canary Wharf, is a haunt of Gareth Jones, a salesman at BNY Securities. The event was the inaugural public gig of The Dealers.

When Allianz announced its first-half results in August, it fuelled both sides of the argument about Dresdner Kleinwort Wasserstein's future.

Strong growth and enhanced political stability appear to have broken down the barriers to foreign investment in Russia. But since much of what flows is disguised in various ways, it's hard to state precise figures.

Source: www.breakingviews.com is Europe's leading financial commentary service

Bankers are grateful for the bouyancy of the debt capital markets. But they are not letting the rush of business impede their efforts to broaden the range of products they offer clients and cut out unfruitful relationship banking.

"When we launched our Vice Fund, one SRI [socially responsible investing] group said they would pray for us," says Dan Ahrens, co-manager of Mutuals.com's Vice Fund.

Ibrahim bin Abdulaziz Al-Assaf, Saudi Arabia's minister of finance and national economy since 1996, has steered the economy through a difficult period. He has played a leading role in the modernization, diversification and liberalization of the Saudi economy and managed its finances prudently in a period in which oil prices have swung between $10 and $30 a barrel. Al-Assaf, a 54-year old economist who has served as the country's executive director at the World Bank for six years and as vice-governor of the Saudi Arabian Monetary Agency (Sama) and wins Euromoney's finance minister of the year award for 2003, spoke to Nigel Dudley in his office in Riyadh.

Ghana has stolen a march on its rivals in the world of peacekeeping operations. The ministry of defence drew down in August the first instalment of a $55 million loan from Barclays that will enable it to upgrade its military equipment and secure higher-margin reimbursement from the UN for a stint in the Democratic Republic of Congo.

Debt capital markets is one area of European banking that is hiring rather than firing. But most of the new jobs are at banks still building a presence, and it is only skilled, experienced staff that they are after at modest cost.

Saudi Arabia is making progress in restructuring its economy, but keeping up to speed a move away from dependence on oil itself rests on high oil prices and low interest rates.

Advisers: UBS (Cordiant); Goldman Sachs (WPP)

After falling out with the US over access to Iraq, Turkey is regaining favour with the west as its economy revives. Its long-term goal is EU membership, but how far away does that target remain?

A growing number of companies are realizing that there is a large pool of cash in the Islamic world that they may be able to tap into to diversify their funding sources and lower their financing costs. However, they must be willing to embrace Shariah-compliant structures.