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Where Next for the World Economy?Strategies, Risks and Scenarios for the Recovery (2011-2015)
Justin Patrie, Head of Country Risk & Financial MarketsBusiness Monitor International
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Outline1. Global Outlook
– Europe: 3-Speed Eurozone Takes Shape– USA: An Imbalanced Recovery– Asia: Growth To Moderate
2. CEEMEA Strategy– MENA: Implications of the ‘Arab Spring’– CEE: From Crisis To Growth– Africa: Commodities, Consumers and Investment
3. Key Conclusions & Appendix Tables
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Global Outlook: World On The Mend• The global recovery will mature further through 2011/2012, underpinning stability in credit markets
• Companies have cash, the labour market will improve further and banks are willing to lend. This bodes well for investments and a slow but steady improvement in credit growth.
• That said, rising commodity prices, Europe’s debt profile, slowdowns in Asia, interest rate hikes, political instability and weak US household consumption all contribute to a substantial risk profile
• This will not be a repeat of 2003-2007. Credit dynamics and investor risk appetite will not replicate the pre-crisis period.
• Divergence will be a key global theme. Performance in Europe will be divided between the core and periphery; US growth will be uneven, led by business investment; key emerging markets are in the process of structural shifts
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This can be your title pageI. Global Outlook
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The Maturation Of The Recovery…
Eurozone
Source: Eurostat and Bureau of Economic Analysis
United States
GDP By Expenditure Percentage Point Contribution To Growth
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Where Are We In The Recovery?BMI Global Forecasts 2009 2010 2011f 2012f 2013f 2014f 2015f
World Real GDP Growth (%) -1.7 4.3 3.5 3.7 3.8 3.8 3.7
World Consumer Inflation (% ave) 1.9 3.0 3.6 3.6 3.5 3.5 3.4
Oil Price, Brent Crude (US$/bbl) 67.00 79.47 94.00 99.00 93.00 93.00 92.63
ECB Refinancing Rate 1.00 1.00 2.00 3.25 4.00 4.00 4.00
US Fed Funds Rate 0.00 0.00 0.00 2.00 3.50 4.25 4.25
Bank of Japan Overnight Call Rate 0.10 0.10 0.10 0.10 0.10 0.10 0.10
Bank of England Base Rate 0.50 0.50 1.00 2.25 3.25 4.00 4.50
US$/EUR Exchange Rate (ave) 1.40 1.33 1.43 1.38 1.30 1.25 1.25
• Since mid-2009, the global macroeconomic recovery has continued apace, though the growth drivers have begun to shift away from exports and inventory re-stocking and back towards domestic demand
• With the recovery maturing, global credit markets are set to stabilise further, even as inflation and interest rates rise
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Credit Markets Are Coming Back…Eurozone credit growth isexpected to rise further
After its greatest period ofcontraction in over 60 years,US credit is showing signs of expansion
Source: European Central Bank and US Federal Reserve
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In 2011, the key stories in the US, Europe and Asia have remained benign…
1. The existential crisis risks to the eurozone were overblown…2. US demand signals and large cap businesses are doing well…3. China continues to grow strongly suggesting a ‘soft landing’…
Dow Jones
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Capital Markets Are Well Beyond The Crisis Phase…
German 2-year treasury yields (%)
MSCI World Equity Index
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Divergence Will Continue To Be A Major Theme
2. The developed world lags emergingmarkets in monetary policy tightening. This will help push rebalancing in EMs.
3. The US recovery will not be commensurate with a strong labour or housing market. This suggests divergent sectoral performances
1. Eurozone will be a region divided, with sharp differentiations in credit conditions, labour markets, demand and growth.
Germany to outperformEM currencies to appreciate
business investment to be key growth engine
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The Risk Profile Remains Substantial…• The disaster in Japan and political instability in MENA have elevated an already substantial risk profile for the world economy
• That said, while these events have challenged our generally positive recovery outlook, they have not forced a fundamental reassessment of our global macro/market strategy
Uprisings Across MENA…
Elevated Investor Risk Aversion
Supply Risks To Energy Production
Demand Destruction
MENA Growth Revised Down
Oil Price Forecasts Revised Up
Liquidity To Remain Subdued
Japan Disasters
Key Supply Chains Disrupted
Negative Impact On Fiscal Position
Nuclear Power Sector Downturn
Japan Growth Revised Down
Temporary Setback For Industrials
Asia Largely Unaffected
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Risk 1: Getting The Policy Wrong (Monetary Policy Tightening)
• What happens when QE2 is drawn down? There is no historic precedent so no one knows for sure…
• The Fed is likely to err on the side of caution though, so don’t expect rate hikes until H112 at the earliestUS Federal Reserve Assets, US$bn
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Risk 2: Eurozone Debt• Most investors (and BMI) expect Greece to restructure its debtThe risks come not from whether Greece will restructure but how…
• Uncertainty over the potential size of hair cuts and the level of exposure within individual markets and banks raises the risks of volatility
Source: Bloomberg, BMI
Greece: Outstanding Bonds, EURbn
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Risk 3: China Asset Bubble BurstIs China the next great macroeconomic disaster?
• The state of the Chinese real estate and construction sectors is one of the most important questions for the global macro outlook…
• China is in the process of a major re-structuring away from exports and investments and towards consumption... Gross Fixed Capital Formation Growth
Source: Respective Central Banks
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Risk 4: Commodities Price Super SpikeCould oil go back to US$150/bbl? Only if Saudi Arabia or another major producer experiences an unlikely political event…
Food price inflation is a major factor in MENA unrest and contributing to rate hikes.Grains could rise to records should supply remain tight…
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Eurozone: Driven By The Core • Strength in the core (DE and FR) will outweigh risks from the periphery
• Crisis will be averted as policymakers control systemic risks
• German demand will become an increasingly important factor driving growth
•Structural reforms could be a long-term game changer, though political will for change is likely to diminish going forward
• BMI Eurozone Forecasts 2008 2009 2010 2011f 2012f 2013f 2014f 2015f
Real GDP Growth (%) 0.4 -4.1 1.7 (2.2) 1.8 2.0 1.9 1.8
GDP per capita (EUR) 28,900 27,424 27,929 28,365 29,327 30,357 31,453 32,600
Unemployment (% eop) 8.3 9.9 10.4 9.7 9.2 8.4 8.0 8.0
Current Account (% of GDP) -1.5 -0.6 -0.6 -0.5 -0.6 -0.6 -0.6 -0.6
Fiscal Deficit (% of GDP) -2.0 -6.3 -6.0 -5.5 -4.3 -3.1 -2.2 -2.2
Inflation (% ave) 3.3 0.3 1.6 2.2 1.9 1.9 1.9 1.8
ECB Refinancing Rate (% EOP) 2.50 1.00 1.00 2.00 3.25 4.00 4.00 4.00
Exchange Rate, US$/EUR (ave) 1.47 1.41 1.33 1.43 1.39 1.30 1.25 1.25
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The Risk Dynamics Have ShiftedSignificantly Since 2010…
1. An aggressive policy response has calmed investors and re-established stability to capital markets. The expectations that a eurozone break up is possible have fallen dramatically.
2. Robust German (and to an extent French) growth has confirmed that the core will be resilient to the debt crises in Greece, Ireland and Portugal. As an aggregate, the eurozone looks healthy.
3. Spain and Italy are not crisis states, diminishing the usefulness of the ‘PIIGS’ moniker
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•EU, ECB, Euro-Area Governments and IMF have all been proactive in establishing support mechanisms for troubled economies…
Policy Response Has Been Key
EFSF• Emergency financing programme tapped by Portugal and Ireland• Provided markets with a clearly defined emergency multi-lateral financing programme for the eurozone
European Stability Mechanism• Long-term financing programme meant to replace EFSF in 2013• Provides a permanent bail-out mechanism, thus mitigating uncertainty risk over the long run
Euro Plus Pact• A structural reform agreement designed to enhance the SGP• Failed to deliver the more far-reaching reforms demanded by Germany, effectiveness is in question
ECB Interventions• ECB has been the most active buyers of periphery debt and has showered the banking system with liquidity• Liquidity crisis highly unlikely with ECB commitment
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2. But when the EFSF came into play, the correlation broke down .Greek yields kept rising but euro reversed and has been appreciatingsince…
Greece No Longer Moves Euro Markets…
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Spain: Risks Are There But No Need To Panic
Source: European Central Bank
Banking sector is stabilising, with crisis risks mitigating by the month…
While a systemic solvency crisis is less of a risk, the macro story will be weighed down for years…
Unemployment Rates, %
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Spain: Housing/Construction Is A Disaster…
Source: Instituto Nacional de Estadistica, TINSA IMIE, Business Monitor International Forecasts
BMI Spain Forecasts 2008 2009 2010 2011f 2012f 2013f 2014f 2015f
Real GDP Growth (%) 0.9 -3.7 -0.6 0.7 1.4 1.9 2.0 2.1
Private Consumption Growth (%) -0.6 -4.2 -1.5 0.5 1.2 1.6 1.9 1.9
Capital Investment Growth (%) -4.8 -16.0 -5.0 -0.5 1.5 1.9 2.5 2.4
Inflation (% ave) 4.1 -0.3 1.0 1.3 2.0 2.2 2.3 2.3
House Prices, Decline From Peak (%)
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As An Aggregate, The Eurozone Recovery Looks Healthy
Source: Eurostat
Percentage pt. contribution to real GDP growth
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It All Begins With German Industry…
Without the leverage over-hang of the UK or US and its highly productive export sector…
…Germany has been able to take advantage of the boom in EMs and recovering French demand.
Source: DeSUS, Institute for Economic Research (IFO)
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Export Strength Has Filtered Through To Wider Business Sectors…
Source: IFO
Services and Manufacturing Rising In Tandem
Corporate confidence at record highs
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…And Corporate Strength Means Credit Strength
IFO Survey: % Respondents Who Say It Is Difficult To Access Credit
• By historic standards, German companies are not having difficulties accessing credit…
Source: IFO
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ZEW Survey Affirms Maturation Of Recovery Confidence Is Back At Cycle Highs,
Though Expectations Suggest Peak Is Near…
Source: ZEW, Business Monitor International Forecasts
BMI Germany F/casts 2010 2011 2012 2013
Real GDP Growth (%) 3.6 3.5 2.0 1.8
Private Consumption Growth (%) 0.5 1.3 1.0 1.0
Capital Investment Growth (%) 5.5 4.1 2.4 1.7
Inflation (% ave) 0.5 1.6 1.8 1.2
Industrial Production (% ave) 14.2 9.0 5.0 3.0
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What Does This Mean For The Eurozone?1. Wide divergences, with Germany leading, France and Italy in the middle and Spain, Greece and Portugal lagging- a ‘3-speed Europe’
Unemployment, % of Total
Source: Eurostat
Employment Rate, % of Total
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2. The Consumer Has Lagged, But Will Play Catchup
Source: EU Commission Survey
Household Savings Rates, %
EU Confidence Indices
Lower household savings rates reflective of improved confidence and bodes well for investment growth
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3. Investment Rates Will Rise…
Manufacturing Capacity Utilisation has rebounded
Which bodes well for corporate investments
Source: Eurostat
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4. Monetary Policy Will Tighten Further!
Source: European Central Bank, European Commission
• Euro will remain buoyed against dollar, at least until 2012
• Expect borrowing rates to rise, but monetary policy should remain accommodative
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Western Europe: What A ‘3-Speed’ Eurozone Means For
Strategy 1. On the whole, European capital markets will remain stable, contributing to the broader global recovery.
2. Germany, the Nordic States and Central Europe will continue to lead in growth and demand terms.
3. While the peripheral economies of Portugal, Greece, Ireland and Spain will continue to post weak growth over the medium term, they will benefit from core strength.
4. The euro will not collapse, equities should rise further and bond yields will go up.
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USA: An Unbalanced Recovery•
BMI USA Forecasts 2008 2009 2010 2011f 2012f 2013f 2014f 2015f
Real GDP Growth (%) 0.0 -2.6 2.9 2.9 2.9 2.8 2.5 2.4
Capital Investment Growth (%) -6.4 -18.3 3.8 7.8 8.0 6.8 5.3 5.3
Private Consumption Growth (%) -0.3 -1.2 1.8 3.1 3.2 2.9 2.2 2.0
GDP per capita (US$) 47,257 46,007 47,308 49,056 51,075 53,192 55,298 57,406
Unemployment (% eop) 7.0 10.0 9.4 8.8 8.1 7.5 7.3 7.1
Current Account (% of GDP) -4.7 -2.7 -3.2 -3.5 -3.3 -3.2 -3.1 -3.0
Fiscal Deficit (% of GDP) -3.2 -10.0 -8.8 -9.5 -7.1 -5.0 -3.7 -3.2
Inflation (average %) 3.8 -.4 1.6 2.3 2.0 2.0 2.0 2.2
Fed Funds Rate (% eop) 0.00 0.00 0.00 0.00 2.00 3.50 4.25 4.25
• US growth will be uneven and led by business investment and gross exports. This is an unusual recovery by historic standards.
• Large corporates have done exceedingly well, though the same cannot be said for small businesses
• Household and corporate balance sheet repair is in a mature phase, like in the eurozone, this bodes well for investment
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This Is An Unusual Recovery…• Inventory re-stocking and business investment is playing a much larger part in this recovery
• Residential investment is placing a net drag on growth confirming the still weak state of the housing market
% point contribution to cumulative growth during recovery period after recession
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No Wonder The Dow’s Doubled Since Mid-2009
US corporate profits are at record highs!
Like In Europe, the industrial sector has led the way
Source: Bloomberg, ISM
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Companies Sitting On Piles Of Cash, Though Small Businesses Still Suffering
Source: Bloomberg
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Labour Market Has Been Slow To Recover…
Americans are leaving the workforce: Unemployment rate is coming down, but participation remains at record lows
NFP’s will be key to watch
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There Has Been A Structural Shift In Long-Term Personal Consumption
Source: Business Monitor International
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The Status Of US Balance Sheet Repair: But there are tentative signs that households are coming back slowly
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Monetary Conditions Bode Well
Banks are sitting on record reserves
Consumer credit beginning to pick up
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Asia: China Moderation • Emerging markets growth in Asia will moderate, though the region will remain a key driver of global growth
• China is in the process of a major macroeconomic restructuring with private consumption rising in relative importance to investment and exports
• Indian growth will outpace China over the long run
BMI Asia Growth Forecasts 2008 2009 2010 2011f 2012f 2013f 2014f 2015f
China 11.7 9.2 10.3 8.9 8.1 7.6 7.0 7.0
Hong Kong 2.3 -2.7 6.8 4.1 3.9 3.5 3.6 3.6
India 6.8 8.0 8.6 7.8 8.2 8.0 7.9 7.6
Indonesia 6.0 4.6 6.1 5.9 5.8 6.2 6.3 6.4
Japan -1.2 -6.3 3.9 0.7 1.8 1.3 1.2 1.2
Philippines 3.8 0.9 7.3 5.1 4.8 5.0 4.8 4.8
South Korea 2.2 0.3 6.1 4.0 4.7 4.1 4.2 4.2
Taiwan 0.7 -1.9 10.8 4.3 5.0 5.1 5.0 4.9
Thailand 2.7 -2.5 7.8 3.6 4.0 4.2 4.3 4.2
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CEEMEA Strategy: Investment Boom Has Legs • Russia and Turkey are among the strongest EM convergence stories over the long term. Both will benefit from robust investment cycles, rising consumption and strong headline real GDP growth
• UAE and Qatar will be resilient to regional political crises while Saudi Arabian investment will continue to boom.
• Egypt and Morocco still present strong growth stories assuming there are peaceful political resolutions.
• Ghana, Nigeria and Zambia are among our favourite global frontier markets. All combine commodity booms with broader consumer and infrastructure investment plays.
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MENA: Assessing The Implications• Conflicting Trends: Higher oil prices benefit producers, but higher risk premiums undermine importers
• There has been a fundamental shift in risk perceptions across the region
• Political crises are unlikely to be resolved soon, there will be protracted uncertainty
BMI MENA Growth Forecasts 2008 2009 2010 2011f 2012f 2013f 2014f 2015f
Bahrain 6.3 3.1 3.5 -1.6 1.6 2.8 4.7 13.0
Egypt 7.2 4.7 5.1 3.2 3.7 4.9 4.9 5.0
Iran .8 1.2 1.6 1.2 2.4 2.2 1.9 2.5
Israel 4.0 .7 3.7 3.8 3.3 3.2 3.0 3.0
Morocco 5.5 3.8 3.3 2.2 4.1 4.1 4.2 3.7
Oman 12.7 1.4 4.3 4.3 3.7 1.8 1.9 1.9
Qatar 25.4 8.7 15.9 17.2 7.8 6.6 6.4 5.8
Saudi Arabia 4.1 0.4 3.8 5.0 5.1 3.6 3.5 3.2
UAE 7.4 -3.0 2.9 3.3 3.2 3.1 4.0 4.5
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Dual Deficit Economies Most At Risk
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Morocco, 5-year credit default swap (bps)
• rising risk premia will pose particular challenges for those that rely on foreign financing…
Source: Bloomberg, Respective Central Banks
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Oil Exporters Oil Importers
CrisisLib, Bah
OutliersAlg, Irq, Irn
Gulf MonarchiesSA, Qat, UAE,
Kw,Om
MonarchiesMor, Jor
OutliersLeb
CrisisTun, Egp, Syr, Yem
More StableLess Stable Less Stable
Wide Divergences In Political Stability
Source: Business Monitor International
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CEE: Russia And Turkey As Global EM Leaders • Both Russia and Turkey present robust growth stories fitting in
with the wider secular emerging market convergence pattern• Capital investment growth will average 7.0% in Turkey and
7.8% in Russia from 2011-2015.• Both countries will benefit from very stable banking systems,
low leverage ratios and booming middle classes.
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BMI Russia and Turkey Forecasts
2008 2009 2010 2011f 2012f 2013f 2014f 2015f
Russia Real GDP Growth 5.2 -7.8 4.0 4.6 4.5 4.7 4.3 4.3
Turkey Real GDP Growth 0.7 -4.8 8.9 4.3 4.5 5.4 5.4 5.4
Russia GFCF Growth 10.6 -14.4 6.1 7.0 7.0 7.0 7.0 7.0
Turkey GFCF Growth -6.2 -19.1 30.0 7.6 7.9 8.2 7.7 7.5
Russia Consumption Growth 10.6 -4.8 3.0 3.0 4.1 5.0 5.5 5.5
Turkey Consumption Growth -0.3 -2.3 6.6 4.3 4.3 4.7 4.5 4.5
Russia GDP, US$bn 1,661 1,223 1,480 1,727 2,100 2,475 2,797 3,129
Turkey GDP, US$bn 730 614 737 822 945 1,084 1,224 1,361
Russia GDP per capita, US$ 11,698 8,620 10,438 12,228 14,929 17,669 20,043 22,520
Turkey GDP per capita, US$ 9,874 8,202 9,732 10,732 12,198 13,852 15,474 17,029
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Africa: Favouring The Frontiers• African frontier markets
are among our global favorites
• Commodity export booms in Nigeria, Ghana and Zambia will help drive a concurrently robust expansion in infrastructure investment. This in turn will feed through to local consumers as well.
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Real GDP Growth Forecasts (%)
Source: Business Monitor International
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Appendix
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Key Conclusions:1. The recovery is maturing and the demand outlook is improving in the US and
Eurozone. However, the risk profile is substantial, suggesting that the recovery will not be a straight line.
2. Credit Markets are expected to improve further, but a repeat of the 2003-2007 credit boom is not expected.
3. Business investment will form a large component of the global recovery .4. Europe: Core states led by Germany will continue to perform well ensuring
stability and mitigation of crisis risks. Russia and Turkey will be outperformers.5. MENA: The revolutions are a ‘game changer’ and the risk profile has fundamentally
shifted, but economies such as Qatar, UAE and Saudi maintain positive outlooks.6. Africa: Frontier markets including Ghana, Nigeria and Zambia are only at the
beginning of a long-term investment, consumption and export boom.
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Appendix I: Western Europe GDP Forecasts Table2011f 2012f 2013f 2011f 2012f 2013f 2011f 2012f 2013f
Western Europe REAL GDP GROWTH, % GDP, EURbn GDP PER CAPITA, EUR
Austria 2.0 1.9 1.9 294 306 319 35,067 36,480 37,899
Belgium 1.7 2.1 2.2 365 380 395 31,262 34,094 35,220
Cyprus 1.2 1.8 2.4 18 19 20 21,507 22,207 23,083
Denmark 2.0 2.3 2.6 306 332 364 54,842 59,582 65,222
Eurozone 2.2 1.8 2.0 9,366 9,701 10,059 28,365 29,327 30,357
Finland 2.7 2.2 2.3 187 194 201 34,753 35,858 37,011
France 1.7 1.7 2.0 2,015 2,090 2,171 31,932 33,005 34,196
Germany 3.5 2.0 1.8 2,582 2,678 2,757 31,703 32,963 34,028
Greece -3.1 0.9 1.3 221 224 229 19,479 19,718 20,092
Iceland 2.5 3.2 1.6 11 14 15 35,121 43,164 46,715
Ireland 1.3 2.1 2.2 160 167 174 35,445 36,510 37,411
Italy 1.6 1.9 1.9 1,479 1,533 1,590 24,376 25,257 26,188
Netherlands 2.2 2.3 2.7 619 644 678 37,430 38,749 40,662
Norway 2.0 2.3 2.2 388 428 446 78,849 86,420 89,330
Portugal -1.3 0.8 1.8 168 170 175 15,749 15,912 16,410
Spain 0.7 1.4 1.9 1,074 1,113 1,162 23,082 23,741 24,602
Sweden 4.4 3.0 2.5 392 419 433 36,888 39,315 42,297
Switzerland 1.9 2.0 2.0 426 425 437 54,595 54,291 55,653
UK 1.7 2.2 2.5 1,792 1,998 2,284 28,646 31,784 36,157
Source: Business Monitor International50
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Appendix II: Central and Eastern Europe GDP Forecasts Table2011f 2012f 2013f 2011f 2012f 2013f 2011f 2012f 2013f
CEE REAL GDP GROWTH, % GDP, EURbn GDP PER CAPITA, EUR
Albania 5.0 6.5 6.7 10 12 14 3,148 3,747 4,318
Armenia 6.0 5.9 5.7 8 10 12 2,641 3,271 3,812
Azerbaijan 5.9 6.0 6.1 38 45 55 4,196 4,984 5,951
Belarus 6.7 6.4 6.7 44 51 59 4,557 5,320 6,169
Bulgaria 2.7 3.3 4.0 36 41 44 4,735 5,487 5,897
Croatia 1.7 1.9 2.2 44 47 52 9,993 10,691 11,756
Czech Republic 2.4 3.2 3.8 159 176 195 15,052 16,692 18,395
Georgia 5.5 6.3 5.5 10 12 14 2,314 2,884 3,452
Hungary 2.3 2.6 2.8 115 127 138 11,556 12,733 13,907
Kazakhstan 6.3 7.0 7.5 103 129 158 6,302 7,848 9,543
Poland 4.6 3.8 4.0 399 453 513 10,474 11,880 13,496
Romania 2.1 3.3 4.2 135 150 165 6,315 7,068 7,797
Russia 4.3 4.5 4.7 1,204 1,517 1,899 8,527 10,788 13,553
Serbia 3.2 4.0 4.9 32 36 42 4,460 4,962 5,754
Slovakia 3.2 3.5 3.8 70 74 78 12,319 12,757 14,078
Slovenia 2.0 3.0 2.9 37 39 41 18,094 19,005 19,992
Turkey 4.3 4.5 5.4 575 684 834 7,505 8,839 10,656
Ukraine 3.6 4.4 4.7 108 140 175 2,382 3,088 3,888
Uzbekistan 8.5 8.4 8.0 31 37 44 1,064 1,244 1,465
Turkmenistan 9.7 10.0 10.2 15 18 22 3,383 4,084 5,014
Source: Business Monitor International
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Appendix III: Middle East & North Africa GDP Forecasts Table2011f 2012f 2013f 2011f 2012f 2013f 2011f 2012f 2013f
MENA REAL GDP GROWTH, % GDP, EURbn GDP PER CAPITA, EUR
Algeria 2.7 3.7 4.7 143 165 180 3,983 4,518 4,852
Bahrain -1.6 1.6 2.8 22 25 26 27,016 29,992 30,617
Egypt 3.2 3.7 4.9 170 203 257 2,010 2,361 2,943
Iran 1.2 2.4 2.2 325 374 433 4,348 4,936 5,645
Iraq 5.5 5.2 6.6 109 125 142 3,284 3,689 4,091
Israel 3.8 3.3 3.2 174 195 216 22,471 24,782 26,969
Jordan 3.8 4.2 4.5 18 21 24 2,761 3,049 3,471
Kuwait 3.4 4.0 4.0 111 128 137 38,060 42,879 44,840
Lebanon 5.5 4.8 4.8 31 36 40 7,184 8,306 9,225
Libya -23.2 2.7 3.3 50 63 80 7,427 9,315 11,540
Morocco 4.3 4.3 4.2 65 72 81 1,979 2,166 2,434
Oman 4.3 3.7 1.8 38 42 47 12,703 13,816 15,092
Qatar 17.2 7.8 6.6 106 122 143 69,156 78,437 90,024
Saudi Arabia 5.0 5.1 3.6 293 330 375 11,043 12,195 13,583
Syria 4.3 5.0 4.7 49 57 66 2,235 2,510 2,856
Tunisia 1.3 2.3 4.9 30 34 39 2,831 3,181 3,529
UAE 3.3 3.2 3.1 211 235 262 43,865 47,820 52,442
Yemen 2.2 3.3 2.7 25 28 31 1,008 1,086 1,187
Source: Business Monitor International52
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Appendix IV: Sub-Saharan Africa GDP Forecasts Table2011f 2012f 2013f 2011f 2012f 2013f 2011f 2012f 2013f
Sub-Saharan Africa REAL GDP GROWTH, % GDP, EURbn GDP PER CAPITA, EUR
Angola 7.6 7.9 6.3 80 111 127 4,118 5,510 6,167
Botswana 5.1 5.0 5.0 12 14 17 5,774 6,818 8,381
Cameroon 3.7 5.7 5.2 19 21 25 916 1,008 1,152
Cote d’Ivoire -5.4 7.7 3.2 19 22 24 886 1,018 1,074
Congo (Rep. Of) 5.9 3.2 2.0 7 7 8 1,768 1,868 1,963
Ethiopia 8.5 7.6 7.0 19 22 25 218 240 273
Ghana 14.0 7.9 7.5 25 35 49 1,001 1,371 1,895
Kenya 5.2 6.3 5.9 29 36 45 701 837 1,025
Mauritius 5.5 5.1 5.3 8 10 11 6,161 7,600 8,730
Mozambique 8.2 6.9 6.5 8 12 16 352 480 627
Namibia 4.5 5.2 5.8 10 13 14 4,827 5,803 6,358
Nigeria 7.8 7.6 7.8 221 282 370 1,359 1,693 2,169
South Africa 3.5 4.0 4.3 308 361 432 6,147 7,130 8,438
Sudan -10.9 2.4 4.8 44 48 61 1,256 1,335 1,669
Tanzania 6.5 6.6 6.3 18 22 26 391 450 537
Uganda 7.0 9.3 9.7 13 16 22 399 499 644
Zambia 7.5 7.2 6.1 14 17 22 1,007 1,238 1,506
Source: Business Monitor International
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Appendix V: Exchange Rate and Interest Rate Forecasts2011f 2012f 2013f 2014f 2015f 2016f 2017f
EXCHANGE RATES (average)
Global Benchmarks
US$/EUR 1.43 1.39 1.30 1.25 1.25 1.25 1.25
JPY/US$ 88.00 90.75 93.75 97.50 102.50 105.0 107.50
CNY/US$ 6.55 6.43 6.31 6.18 6.06 5.94 5.82
US$/GBP 1.67 1.70 1.75 1.75 1.75 1.75 1.75
CEEMEA Currencies
RUB/EUR 42.16 37.57 33.47 31.56 31.25 31.25 31.25
TRY/EUR 2.13 1.99 1.83 1.73 1.71 1.70 1.68
PLN/EUR 3.82 3.52 3.36 3.30 3.17 3.13 3.11
ZAR/EUR 9.39 8.83 8.15 7.76 7.68 7.61 7.53
EGP/EUR 8.51 8.14 7.38 7.06 7.05 6.65 6.25
INTEREST RATES (end of period)
US Fed Funds Rate 0.00 2.00 3.50 4.25 4.25 4.25 4.25
ECB Refinancing Rate (Eurozone) 2.00 3.25 4.00 4.00 4.00 4.00 4.00
BoJ O/N Call Rate (Japan) 0.10 0.10 0.10 0.10 0.10 0.25 0.50
BoE Bank Rate (UK) 1.00 2.25 3.25 4.00 4.50 5.50 5.50
SNB 3M LIBOR Target (Switzerland) 0.75 1.25 1.50 2.00 2.00 2.00 2.00
BoC O/N Rate (Canada) 2.00 3.00 4.25 4.50 4.50 4.50 4.50
PBOC 1Y Lending Rate (China) 6.81 6.81 6.81 6.81 6.81 6.81 6.81
CBR Refinancing Rate (Russia) 8.50 9.50 9.00 8.50 8.00 7.00 7.00
Source: Business Monitor International
Business Monitor International
Business Monitor International• Business Monitor International is a leading provider of global country
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