• Turkmenistan – strong growth, robust external position;
  • United Kingdom – problems with Scottish independence;
  • Uzbekistan – internecine battle could affect US exit plans from Afghanistan;
  • Zambia – dollar supplies have dried up.

BELIZE:  Economic growth has slowed considerably and is not likely to pick up much in the current year. Social conditions have not improved, but tensions should remain contained. The official FX cushion is thin and the payment experience of exporters to Belize leaves to be desired.

CHINA: The authorities are loosening the constraints on the yuan and on interest rates just as they report a broad economic slow-down. They will be cautious with any stimulus they decide to apply, however, and they did not step in to prevent the first default in the corporate bond market as they seek to develop the financial system.

MALAYSIA: Due to the disappearance of flight MH370 from civilian radar screens on March 8, the government of PM Najib Razak is going through an unusually difficult period in which its credibility is failing international stress tests.  The economy is doing generally well and the external accounts, though deteriorated, are easily manageable.

PARAGUAY: The economy will grow more slowly this year than in 2013, when it bounced back from a severe drought, but it will still put in a creditable performance. The external accounts should remain easily manageable. President Cartes has already passed several key laws and, although he is a political neophyte, may be counted on to accomplish more on this front.

POLAND: The performance of the zloty in the midst of Ukraine’s crisis reflects the country’s increasingly close ties to the European Union as well as indications that the economy is starting to recover. There are still risks, to be sure, but overall the outlook is good.

PORTUGAL: The government is trying hard to secure for the country a clean exit from its international bailout program. The omens are promising, although there are no guarantees yet.  The economy has started to grow again, but the government still has to trim spending this year.

Tunesia: This is now the only “Arab Spring” nation that is within striking distance of becoming a true democracy. It is still facing big problems, though, which are partly socio-political and partly economic. While the external position has stabilized, the current-account BoP is still running large deficits.  The biggest problem right now is painfully high unemployment.

UKRAINE: Russia’s annexation of Crimea has little in common with the “parallels” Putin likes to conjure up. But the Western response will not deter him from attempting a broader absorption of Ukraine into Russia’s “sphere of influence.” There will be serious consequences for Western firms in Russia and Russian companies in the West.

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