Welcome to the latest edition of Frontier Markets News. As always, I would love to hear from you at with news ideas, feedback and anything else you find interesting.

If you'd like to receive this newsletter in your inbox every weekend, sign up at Please also share this link with any friends or colleagues you think would enjoy it.

Last week, FMN’s Noah Berman caught up with Shinta Kadmani, the chair of B20 Indonesia. Jump to the end of this newsletter to read about her thoughts on the efforts emerging markets will have to make to tackle recent challenges.


Floods rock Nigeria. Relentless flooding has destroyed massive swaths of farmland, infrastructure and homes in Nigeria, displacing some 1.4 million people and destroying thousands of homes, the New York Times reports. Flooding has also killed more than 600 people so far this year.

The flooding has reached 27 of Nigeria’s 36 states, officials said. Nigerian Minister of Humanitarian Affairs Sadiya Umar Farouq called the floods avoidable, writing on Twitter Monday “there was enough warning and information about the 2022 flood but States, Local Governments, and Communities appear not to take heed.”
nigeria flooding
Flooding in Nigeria. Photo: National Emergency Management Agency

Officials have cited climate change and water released from a dam in northern Cameroon as causes for this year’s severe flooding. The Nigerian government signed an agreement with Cameroon to contain flooding by building a twin dam on the Nigerian side of the countries’ shared border in the early 1980s, but the dam was never built, Pulse Nigeria reports.

The flooding has dampened Nigeria’s economic prospects as food inflation reached 23% in August. In 2012, the most recent year Nigeria experienced severe flooding, the World Bank estimated economic losses at over $16 billion.
—Noah Berman

Benin and Togo secure UK investments. Benin and Togo scored investment packages from the UK this week, as Britain bolsters its investment in West Africa. The UK’s export credit agency UKEF guaranteed a £106.5 million ($120 million) loan from Deutsche Bank to the government of Benin. The loan will fund a “ministerial city,” a governmental building complex that will hold offices for 21 ministries.
UKEF also guaranteed £68.6 million in MUFG financing to build a road that will connect Benin and Togo. The bridge is expected to accelerate inter-African trade.
UKEF Benin and Togo investment
UK Trade Commissioner for Africa, John Humphrey, highlights the UK’s commitment to strengthening commercial ties with Francophone Africa. Photo: UKEF

Last year, UKEF supported $856 million in financing in West and Central Africa. “We want to do even more,” UK Minister of State for International Trade James Duddridge said at the UK-Francophone West and Central Africa Trade and Investment Forum in London. Duddridge will have to contend with decreased risk appetite from investors for frontier markets in the region, according to The Africa Report.
—Noah Berman


Khan wins by-elections. Former prime minister Imran Khan’s Pakistan Tehreek-e-Insaf (PTI) party won six out of eight open seats in national assembly by-elections this week. Khan personally ran in seven of the elections, winning the six seats for his party.

Khan’s decision to personally run for the seats makes the victories more ceremonial than effective. Under Pakistani law, a candidate can run for multiple seats in a by-election, but upon winning multiple must choose one and vacate the rest. Khan is already a member of the national assembly, so he will likely vacate all seats he won this week, leaving the PTI to field a new candidate in another election, Al Jazeera reports.
pakistan khan oct 22
Pakistan’s former PM Imran Khan. Photo: Asif Hassan/AFP

Khan was ousted in a vote of no confidence in April, but he has remained popular in the country as it deals with severe flooding that has imperiled the Pakistani economy. Khan said this week he will lead a protest march that will converge on the capital, Islamabad, if the government does not announce a date for early elections, Bloomberg reports. Elections are currently scheduled for October 2023.
—Noah Berman

Dates set for Malaysian election. Malaysia’s election commission announced that national elections will be held on November 19th. Prime Minister Ismail Sabri Yaakob dissolved parliament two weeks ago amid a feud with allies in the ruling coalition.

The decision to hold elections in the monsoon season drew ire from critics and opposition parties who fear that heavy rain and wind may deter voters, the South China Morning Post reports. Parliament’s term had been scheduled to expire in July 2023.
malasia opposition
Malaysian opposition leader Anwar Ibrahim. Photo: Eileen Ng/AP

Ismail’s party, United Malays National Organization, is hoping to take advantage of strong polling to install more of their own members in the ruling coalition government. In the recently disbanded parliament, UNMO had fewer seats than the opposition Democratic Action Party, but had the most seats in the ruling coalition. No party earned enough seats to achieve an outright majority, and analysts anticipate that new coalitions will be necessary to form a government after November’s elections, the Associated Press reports.

UNMO led Malaysia from its independence in 1957 until a multi-billion dollar corruption scandal brought down the party in 2018. UNMO returned to power in 2020.
—Noah Berman

Philippines abandons Russian arms deal. President of the Philippines Ferdinand Marcos Jr. this week endorsed a decision to scrap a $215 million deal to buy 16 Russian military helicopters. The move was previously announced by former president Rodrigo Duterte, but Marcos did not publicly comment on it until this week.

Marcos said the island state and US-treaty ally had “secured an alternative supply” from the US, adding that the aircraft would be manufactured in Poland, ABC News reports. Russia’s ambassador to the Philippines Marat Pavlov disputed Marcos’ account, telling reporters the Philippine government had not officially notified Russia of intent to cancel the deal, France24 reports.
The original decision to withdraw from the deal came as concerns over sanctions made the prospect of paying for the equipment more complicated. Philippine officials also worried the purchase could affect remittances from the US and other Western states, which make up a significant portion of foreign currency flowing into the Philippines, Manila Times reports. Frontier markets have suffered declining foreign reserves this year, as a surging dollar makes imports more costly.
—Noah Berman

Middle East

Israel-Palestine violence reaches highest level since 2015. Israeli soldiers shot and killed a Palestinian at a police checkpoint in the West Bank, as deaths from Israeli-Palestinian violence reached their highest point since 2015, Al-Jazeera reports.

Israeli’s military said the Palestinian’s car was fleeing Israeli forces after illegally crossing into Israel. The victim’s father said he was headed for work when the shooting occurred.
israeli-palestinian violence
Israeli security forces and emergency personnel carry away a Palestinian man, who was shot after he reportedly stabbed an Israeli in occupied East Jerusalem. Photo: Ahmad Gharabli/AFP

Amid a rash of rash of violence, Israeli military checkpoints in the occupied West Bank have been targets for Palestinian shooters, who say they are retaliating against Israeli raids that targeted Palestinian militia members.

Israelis are set to choose their prime minister in an election slated for November 1st that pits current PM Yair Lapid against former premier Benjamin Netanyahu.
—Jack Kubinec

Iran protests spread to labor force. Weeks of protest in Iran spurred by Mahsa Amini’s death at the hands of the regime’s morality police have spread to the nation’s labor unions, The Wall Street Journal reports. Teachers and factory workers went on strike demanding better pay, and scores of striking oil workers have been arrested, according to Iranian activists.
tehran protest oct 22
Students held a protest at Tehran’s Amirkabir University of Technology earlier this month. Photo: ESN/AFP

Iranian Prime Minister Ebrahim Raisi’s government insists the women’s rights protests are waning, but the spirit of discontent threatens the government’s hold on power, particularly as the better-organized labor movement joins the fray.
—Jack Kubinec

Latin America

Central American journalists begin to crack under concerted pressure.
Central America’s strongmen appear to be winning their war on journalism as authoritarian regimes across the region adopt new tactics to repress negative coverage, the FT’s David Argen reports. Leaders in Guatemala, El Salvador and Nicaragua, rather than relying exclusively on violence, have shifted to a new playbook for silencing journalists that includes using laws against money-laundering and foreign-agency to restrict and persecute journalists or media organizations receiving foreign funds.
guatemala journalist
Journalist José Rubén Zamora at a court hearing in Guatemala City in July. He denies charges of money laundering, blackmail and influence peddling. Photo: Johan Ordonez/AFP/Getty Images

In El Salvador, President Nayib Bukele faces accusations of using Pegasus spyware to track journalists, according to Citizen Lab at the University of Toronto. The recent state of emergency over gang violence also included a vague gag law against covering the gangs.

Meanwhile, Nicaragua’s increasingly authoritarian regime has been quietly and consistently repressing the media, with 46 outlets closing since 2018, according to Confidencial, a Nicaraguan newspaper operating in Costa Rica. Even in Costa Rica, the region’s most liberal democracy, newly elected President Rodrigo Chaves has promised to destroy media outlets he blames for a sexual harassment controversy during his stint at the World Bank.
—Ken Stibler

Venezuelan opposition parties move to replace leader Juan Guaido as international strategy shifts from political isolation to economic stabilization. Venezuela’s opposition parties are withdrawing support from Juan Guaidó and seeking to replace him, the WSJ's Kejal Vyas reports. Leaders of A New Era, Democratic Action, and Justice First, the three largest parties in Venezuela’s opposition coalition, concluded at meetings last week that they would not support “interim president” Guaidó after his term expires on January 5th.
Venezuela Juan Guaidó
Juan Guaidó speaks in Caracas, Venezuela, after regional and local elections in November. Photo: Leonardo Fernandez Viloria/Reuters

The move marks a major shift from Western plans for regime change that involved recognizing Guaidó as the legitimate president in 2019. Despite such support, President Nicolás Maduro retained power, assisted by economic and security partnerships with Russia, Iran, China and, to a lesser extent, Cuba and Nicaragua.

The opposition’s change in strategy comes as the Biden administration discusses scaling down sanctions on Venezuela to allow its oil back into the market. The deal is reportedly contingent on Maduro’s resuming talks with opposition leaders to move toward free and fair presidential elections. Other areas of detente are showing as well, with opposition representatives moving to sign a $3 billion humanitarian aid package, along with the Maduro government, which will allow food and medicine imports through a United Nations-administered program.
—Ken Stibler


ESG focus conflicts with impact investing over emerging market allocations.
Addressing climate change will require an extra $2 trillion investment per year in emerging markets, over 70% of which will need to come from private financial sources. Yet, some ESG strategies risk diverting capital away from developing countries that struggle to meet corruption and inequality benchmarks, FT Moral Money’s Sarah Murray reports. By failing to invest up the risk curve—whether political or social—investors are effectively pitting responsible investing against impact investing.
EM fund flows
Pensions and sovereign wealth funds are increasingly avoiding emerging and frontier markets, excluding China, as an asset class given ESG and reputational risks, according to a study by Intellidex. The shift comes as these types of funds have been at the forefront of active ESG ownership approaches.
  • Investors are fleeing emerging markets. Some strategists say it's time to buy. (WSJ)
Increased focus on pro-social or non-financial returns is clearly driving investments then. Yet overall allocations to the markets that can benefit most from such capital remained small at less than 22% in 2021, according to SWF Global data. Such a strategy risks depriving investors of both financial and social returns as the stubborn challenges found in such markets offer a willing destination and necessary proving ground for ESG investments like green energy and sustainable agriculture.
—Ken Stibler

IMF urges foreign exchange caution. Governments should hold tight to their foreign currency reserves in the face of future market volatility and the strongest dollar since 2000, IMF economists Gita Gopinath and Pierre-Olivier Gourinchas wrote in a blog post last week.

The economists urged governments, especially emerging economies, to reinstate swap lines with the central banks of advanced economies. Countries with moderate needs should proactively take advantage of IMF precautionary lines to meet future liquidity needs.
Photo: Andrew Harrer/Bloomberg

The warning comes as nations from Latin America to Asia shed foreign currency reserves to build up their own currencies. Foreign currency holdings by developing and emerging economies slipped by 6% in the first seven months of this year, Bloomberg reports. Meanwhile, the greenback has shot up 15% this year.

The IMF estimates that every 10% of dollar appreciation correlates to 1% in inflation. These pressures can be especially sharp in emerging economies that have higher import dependencies and a greater share of dollar-denominated imports.
—Noah Berman

What we’re reading

Russian role in Burkina Faso crisis comes under scrutiny. (AP)

Nigeria to convert vast central bank loans to 40-year bonds. (Bloomberg)

Eritrea goes for broke in Ethiopian civil war to crush old foe. (Bloomberg)

Somalia signs oil production-sharing agreement with US firm. (Bloomberg)

DR Congo leader rules out deploying Russian mercenaries to quell rebels. (FT)

Mozambique jihadi violence spreads despite military effort. (AP)

Zimbabwe looks to clear its debts as it re-engages with the world. (The Africa Report)

South Africa and Saudi Arabia strike $15b worth of agreements. (The Africa Report)

Can Vietnam weather the coming era of great power competition? (The Diplomat)

Vietnam’s anti-graft campaign casts shadow over economy. (Nikkei)

China carves path to Indian Ocean with Myanmar rail network. (Nikkei)

Pakistan wants to buy fuel from Russia. It has to be sold at ‘India rate.’ (Hindustan Times)

Tajikistan renews crackdown on independent journalists. (Radio Free Europe)

Kyrgyzstan asks Russia-led bloc to send peacekeepers to Tajik border. (Reuters)

Turkey cuts benchmark interest rate despite rampant inflation. (FT)

Erdogan gears up for huge pre-election spending spree in Turkey. (FT)

Iran seeks to exploit widening gulf between Russia and the west. (FT)

Russia shrinks forces in Syria, a factor in Israeli strategy there. (NYT)

As Europe piles sanctions on Russia, some sacred cows are spared. (NYT)

ExxonMobil accuses Russia of ‘expropriation’ as it exits oil project. (FT)

Ukraine’s grain exports recover to near prewar levels. (WSJ)

Ukraine asks Israel for Iron Dome and other defense systems. (Axios)

Bulgarian ex-PM Borissov fails to create new ruling coalition. (BalkanInsight)

Albania to tax private electricity producers’ record profits. (BalkanInsight)

Venezuela: 7.1 million left country since 2015. (BBC)

Colombia’s acreage of coca, used to make cocaine, surges to record. (WSJ)

UN approves sanctions against Haitian gang leader. (WSJ)

Boric’s approval rating hits new low ahead of Chile protest anniversary. (Bloomberg)

Milei plans to ‘dollarize’ economy if elected president of Argentina. (MercoPress)

Argentine prosecutor wants Iran’s VP arrested in Qatar. (MercoPress)

Emergency declared in Uruguay due to poor rainfall. (MercoPress)

Lula’s losing Brazil’s biggest state forces urgent campaign rejig. (Bloomberg)

Bolsonaro cuts into Lula’s lead ahead of Brazil runoff. (Bloomberg)

Interview: Shinta Kadmani, B20 chair

Last week, Noah Berman caught up with Shinta Kadmani, the chair of B20 Indonesia, a summit that connects global business leaders with their diplomatic counterparts ahead of the G20 summit. The annual B20 conference will take place from November 13-14 in Bali.

NB: What key themes are you focusing on this year?

SK: There are three. First [is] prioritizing innovation to unlock post-crisis growth. We can really see innovation [through] technology play a very big role.

Second is pushing to empower SMEs and vulnerable groups. Indonesia is an emerging economy and we want to drive some of the agenda, looking into how SMEs play a big part in the global economy. They need a lot of support, and this is something B20 wants to play more of a role in.

Third is supporting increasing collaboration within developing countries’ business. The development gap remains a fact in this global economy. Such a gap in industrial sophistication, capital generation capability and distribution of enabling infrastructure across countries is detrimental to our efficiency and effectiveness.

NB: Are the challenges facing businesses worldwide more acute in an emerging market like Indonesia?

SK: Increased inflation, rising energy and food costs really impact many countries, including Indonesia. But while Indonesia has been quite lucky—our economic growth has been quite good despite the global crisis situation—we know that next year definitely the storm is coming heavily. Each country has its own set of challenges—some more than others—but it remains a global challenge in terms of rising inflation, food crises, energy crises. Those are aspects businesses need to be aware of and find solutions for.

NB: Since the onset of the pandemic, we’ve seen some nations draw back from globalization. Where do we go from here?

SK: We understand now with the global crisis there are some regressions in globalization, but…we have to get back to having the balance again.

We have to have that interdependency with other businesses from different countries. This is the interesting part of having a multilateral platform like this. You start opening your eyes again to see actually there are many opportunities ahead.

NB: Does globalization—or de-globalization—hurt the developing world?

SK: We want to develop our own manufacturing but we also need the technology, we need the cooperation aspect, with businesses from other countries. The trend for more developed countries to take back their manufacturing obviously will hit developing countries, but this is not about developing vs developed countries. This is the trend where every country will start prioritizing how their own industry can be developed, how we can be less dependent on others.

We need to think about how we can develop our industry and yet be part of globalization.

NB: This year, Indonesia joined the Indo-Pacific Economic Framework. How will that affect businesses there?

SK: The initiative involved ASEAN countries more on the government side, so businesses are not yet well informed on how it will impact them. We look forward to hearing more, to seeing how businesses can take advantage of policy that comes from the Indo Pacific.

NB: There is a lot of talk about how countries in Southeast Asia have to balance between economic interests in China and in the West. Do you feel this need for balancing in the Indonesian business community? Is this harmful or helpful to business?

SK: Businesses are commercially driven at the end of the day. They will see what’s the best interest for them, the best advantage they can be offered. The important element is we can’t be dependent on one country, on both the supply and the demand side. We need both the US and China, and many other countries. Businesses need to look at how to build their own resiliency, and anticipate the crisis that is coming.

Even in a country like Indonesia, we cannot stay complacent. Our economic growth looks very good - but next year? The storm is coming, we’d better be ready.
Email Marketing Powered by MailPoet