Back to the complete issue
Sunday, 26 April 2020

Emerging markets are about to be hit by a crisis of epic proportions

Emerging markets are about to be hit by a crisis of epic proportions, with a public health emergency coming as investors retreat and foreign exchange reserves shrink. In this Bloomberg podcast (listen, runtime: 50:50), senior fellow at the Council on Foreign Relations Brad Setser discusses some of the key measures he uses to track the severity of the situation, as well as potential avenues for damage control.

What is to be done? Setser looks at which countries are particularly vulnerable — think those with oil dependent economies, low foreign exchange reserves or those at risk of debt default prior to the virus — and addresses which tools the IMF has in its arsenal, why its reserve asset (the Special Drawing Right) wasn’t deployed more quickly, and whether some form of health-related conditionality may be attached to loans. The cast also examines the medium- and long-term impacts of reduced tourism and more localized supply chains as economies the world over try to find new ways of balancing resilience with efficiency.

Enterprise is a daily publication of Enterprise Ventures LLC, an Egyptian limited liability company (commercial register 83594), and a subsidiary of Inktank Communications. Summaries are intended for guidance only and are provided on an as-is basis; kindly refer to the source article in its original language prior to undertaking any action. Neither Enterprise Ventures nor its staff assume any responsibility or liability for the accuracy of the information contained in this publication, whether in the form of summaries or analysis. © 2022 Enterprise Ventures LLC.

Enterprise is available without charge thanks to the generous support of HSBC Egypt (tax ID: 204-901-715), the leading corporate and retail lender in Egypt; EFG Hermes (tax ID: 200-178-385), the leading financial services corporation in frontier emerging markets; SODIC (tax ID: 212-168-002), a leading Egyptian real estate developer; SomaBay (tax ID: 204-903-300), our Red Sea holiday partner; Infinity (tax ID: 474-939-359), the ultimate way to power cities, industries, and homes directly from nature right here in Egypt; CIRA (tax ID: 200-069-608), the leading providers of K-12 and higher level education in Egypt; Orascom Construction (tax ID: 229-988-806), the leading construction and engineering company building infrastructure in Egypt and abroad; Moharram & Partners (tax ID: 616-112-459), the leading public policy and government affairs partner; Palm Hills Developments (tax ID: 432-737-014), a leading developer of commercial and residential properties; Etisalat Misr (tax ID: 235-071-579), the leading telecoms provider in Egypt; and Industrial Development Group (IDG) (tax ID:266-965-253), the leading builder of industrial parks in Egypt.