• Czech Republic – no Eurozone entry before 2020;
  • Egypt – a new constitution;
  • Lithuania – headed for the Eurozone in 2015;
  • Serbia – There are likely to be early elections, probably in March;
  • Venezuela – a new economic team and hints of FX reforms to come.

ARGENTINA:  The Plata Republic is not in another full-fledged crisis yet, but the omens are worsening as the country’s growing troubles are scaring investors away. Economic problems are creating social ones, which in turn are leading to political difficulties for the government.

CAMBODIA:  Most garment workers have returned to their jobs, but this is not likely to spell the end of their uprising or of the political pressure on long-ruling PM Hun Sen. While the US, Europe and the UN will continue to push for electoral reform, they will not impose sanctions.

POLAND:  December output numbers served as a reminder that the economic recovery is still very fragile, and they undoubtedly reinforced the CB’s determination to keep interest rates low. The President has signed the controversial pension overhaul into law, but has asked the constitutional court to vet it.

RUSSIA:  The current year is likely to be a soft one for the ruble, as the CB stands ready to relax the reins on the FX rate while all the forces promoting capital flight are still making themselves felt. Admitting that stimulus measures have not worked, the government has cut back economic growth forecasts. It is promising further economic reforms.

SPAIN:  It is still hard to say how solid the recovery is, but there is no longer any denying its existence. Business and consumer confidence are up, but so far only exports are carrying the turnaround. It will take time for domestic consumption to improve. There is also still an outside risk of deflation to be considered.

THAILAND:  The longer the unrest lasts the greater will be the risks that the “Teflon economy” becomes seriously affected. Unfortunately, at this point the anti-government demonstrators show no inclination to compromise, elections scheduled for next month are questionable, and the risk of a military intervention is growing.

TURKEY:  Although the end of PM Erdogan’s confrontation with the judiciary and the forces of Gulen is not yet in sight, it does appear as though he will emerge victorious from this contest. This will be at a substantial cost to his and Turkey’s international reputation, however, which, in turn, will have longer-term economic repercussions.

UNITED ARAB EMIRATES:  Four years after Dubai’s sovereign debt crisis the economy is resurgent and the outlook for the current year is impressive. The risks that are being watched now are related to overheating and a new property bubble, but debt repayments are proceeding apace and reflect the recovery.

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