Frontier Markets Weekly, January 8th 2022


I’m delighted to announce that Ken Stibler joins me this week as a finance and economics contributor covering Latin America. Ken is currently pursuing an MPA in International Development and Economic Policy at George Washington University and has a passion for emerging and frontier markets that developed while he was working with the US State Department, the World Bank and others.

As always, feel free to let me know what you think of this newsletter—or anything else that’s on your mind. Contact me at to share news ideas and feedback. 


Sudan’s prime minister resigns as political crisis worsens. Sudan’s Prime Minister Abdalla Hamdok resigned late last Sunday, abandoning his weekslong efforts to form a new technocratic government to pull the country out of its economic crisis and a worsening political standoff, the Wall Street Journal’s Nicholas Bariyo reports. Hamdok was head of Sudan’s fragile transitional government following the ouster of long-serving leader Omar al-Bashir in 2019, but was toppled and detained in an October coup.

Protesters in Khartoum, Sudan, on Sunday. More than 50 people have been killed in clashes in the last few months. Photo: Marwan Ali/AP

Following a deal with military leader General Abdel Fattah al-Burhan, Hamdok was reinstated in November but protest leaders rejected the agreement and have been demanding a full restoration of civilian rule, plunging the country into weeks of protests as inflation soared and food shortages spread.

Hamdok, a former United Nations economist, cited political fragmentation as well as conflicts between civilians and the military over power sharing as the reasons for his resignation.

US terminates AGOA trade preferences for three Africa nations over human-rights violations. The US government this week ejected Ethiopia, Guinea and Mali from the AGOA trade-preference program saying actions by the three countries’ governments violated the membership terms of the program.

“The Biden-Harris Administration is deeply concerned by the unconstitutional change in governments in both Guinea and Mali, and by the gross violations of internationally recognized human rights being perpetrated by the Government of Ethiopia and other parties amid the widening conflict in northern Ethiopia,” the US Trade Representative said in a statement. The move comes “amid ongoing conflict and famine in Ethiopia…and after coups d’état in Guinea and in Mali,” Reuters reported

The US did leave the door open to the three countries’ rejoining the duty-free pact, though. “Each country has clear benchmarks for a pathway toward reinstatement and the Administration will work with their governments to achieve that objective,” the USTR added.


US on sidelines as China and other Asia-Pacific nations launch trade pact. China joined US allies including Japan and Australia in a new Asia-Pacific trade agreement this week—with the US watching from the sidelines, Yuka Hiyashi reports in the Wall Street Journal. The new Regional Comprehensive Economic Partnership, or RCEP, will eventually eliminate more than 90% of tariffs on commerce among its 15 member countries, in what economists say will be a boon to trade in the region.

The other member nations of the RCEP are Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, New Zealand, the Philippines, Singapore, South Korea, Thailand and Vietnam.

Sri Lanka’s government seeks to ease pain for poorest as economic crisis intensifies. Sri Lanka’s government this week announced a $1.2 billion package of measures intended to defuse intensifying unrest over sharp rises in prices on the island, India’s Business Standard reports. The economic relief package includes tax cuts, additional pay for government workers, subsidies for farmers whose harvests have been hit by a ban on chemical fertilizer and cash grants for the South Asian nation’s poorest citizens.

Sri Lanka has been suffering an escalating foreign-exchange crisis since the onset of the pandemic, which effectively shuttered the country’s tourism industry. Questions have repeatedly been raised about its ability to service its foreign-denominated loans this year, and finance minister Basil Rajapaksa reportedly plans to ask international bondholders to renegotiate their payment schedules.

A Sri Lankan farmer. Photo: Eranga Jayawardena/AP, via The Guardian

In an in-depth story on Sri Lanka’s economic crisis, The Guardian this week reported that “the situation has got so bad that long queues have formed at the passport office as one in four Sri Lankans, mostly the young and educated, say they want to leave the country.”

Russia sends troops to Kazakhstan as dozens killed in unrest. Russia sent paratroopers to help Kazakhstan’s leader stamp out a wave of protests this week, the WSJ’s Ann M. Simmons reports. Dozens of people were killed in clashes between protesters and Kazakhstan’s security forces in the early hours of Thursday, including 18 law enforcement officers, according to Russian state media.

Protesters clashed Thursday with security forces in Almaty, the largest city in Kazakhstan. Photo: Alexander Platonov/Agence France-Presse/Getty Images

Initially sparked by a sharp increase in fuel prices at the beginning of year, the protests quickly spiraled into a broader outpouring of frustration with the resource-rich nation’s authoritarian leaders. Protesters accuse them of squandering its wealth, echoing the kind of uprisings that toppled one of Russian president Vladimir Putin’s protégés in Ukraine in 2014 and a wave of protests against Belarus’s pro-Kremlin leader in 2020.

More than 2,000 people were detained as President Kassym-Jomart Tokayev attempted to regain control of Almaty, the country’s largest city, calling in a Moscow-led security alliance for help putting down what he described as a terrorist revolt, a common accusation made by the leaders of former Soviet states.

Middle East

Military bases housing U.S. forces attacked in Syria and Iraq. Rockets and indirect fire struck bases hosting U.S.-led military coalition forces in Iraq and Syria in at least three separate attacks Wednesday, the third day in a row that Iran-aligned paramilitary groups targeted America and its partners in the Middle East, Jared Malsin and Ghassan Adnan report in the WSJ.

Wreckage from a drone being examined at Baghdad airport on Monday after explosive-laden drones targeted the airport. Photo: Coalition official/Reuters

The latest spate of attacks started on Monday as the militias marked the second anniversary of the American strike that killed senior Iranian general Qassem Soleimani in January 2020. Iran and its allies in the region have sworn to avenge Gen. Soleimani’s death by attacking US forces and driving the American military out of the region. None of the attacks have caused any casualties or major damage, but the persistence of the rocket and drone attacks raises the risk of a broader conflagration.

In a speech in the southern Iraqi city of Basra on Tuesday, the leader of one of the Iran-aligned militias, Harakat al-Nujaba, vowed to continue the fight to expel American forces from the country.


Kosovo bans cryptocurrency mining to save power. Faced with a worsening electricity shortage and rising tensions over rolling blackouts, Kosovo’s government has banned cryptocurrency mining, the BBC reports. The country’s power system has been under strain since its largest coal-fired power station was shut down for technical reasons in December 2021, forcing the government to import power at relatively high prices.

Crypto mining had become popular in Kosovo because, until recently, it had among the lowest electricity prices in Europe. According to the BBC, “the practice is particularly popular in northern areas of Kosovo, where ethnic Serbs do not recognize the state’s independence and refuse to pay electricity bills.”

The blackouts have sparked protests against the government in Kosovo’s capital, Pristina. Photo: Getty Images, via BBC

According to ZDNet, proposals to outlaw crypto mining have surfaced in other European countries. Swedish authorities, for example, sent an open letter to the European Union arguing that the energy consumption associated with crypto mining will jeopardize efforts to slow global warming.

Latin America

Despite Brazil’s darkening outlook, some bright spots remain. Brazil’s economy has been hobbled recently by political instability, shaky public finances and a major drought, but its infrastructure investment-attraction program represents an underappreciated but substantial bright spot in Jair Bolsonaro’s economic agenda, the FT’s Brian Harris writes. 

The World Economic Forum marks Mr Bolsonaro’s first foreign trip as Brazil’s president

The program to attract private investment in infrastructure development has auctioned 131 concessions for $145 billion in investments and raised $26 billion in fees for the government. Officials expect more than 150 further auctions to generate over $70 billion in investments this year. 

The program to attract private investment is not the lone bright spot. Despite the complex tax code and burdensome regulations that Bolsonaro was unable to reform, the country also has a thriving startup ecosystem hosting over 70% of Latin America’s VC funding and 60% of its unicorns, according to El Pais. —Ken Stibler

What We’re Reading

DP World begins construction in Senegal of its biggest port investment in Africa. (The National

Ghana’s debt burden unnerves foreign investors. (Investment Monitor

Russian troops deploy to Mali after French withdrawal. (Radio Free Europe)

I have given my best to Nigeria, says Buhari. (The Guardian)  

Ethiopia releases opposition figures as it seeks end to war. (WSJ

China criticizes sanctions against belt and road partner Eritrea. (SCMP

China’s foreign minister visits Kenya amid unease over rising debt. (Reuters

Fire inflicts heavy damage on South Africa’s parliament building. (WSJ

Morocco’s tough Covid-19 restrictions hammer tourism sector. (Arab News

VinFast delivers first electric cars to customers in Vietnam. (CleanTechnica

Vietnam mulls $15.2b in aid for Covid-hit economy. (Bloomberg

Cambodia’s Hun Sen visits Myanmar to meet military leaders. (VoA

Bangladesh mulls fresh restrictions as Omicron spreads. (NewAge

Afghanistan’s Taliban clash with Pakistan over border fence dispute. (Foreign Policy

North Korea fires missile off its east coast. (WSJ

Turkish inflation soars to highest level under Erdogan. (FT

Turkey and Armenia to hold talks on restoring ties next week. (Middle East Eye

Attacks on U.S. allies raise tensions on anniversary of killing of Iran’s Soleimani. (WSJ

Lebanon’s crippled economy hobbles into new year. (Al Jazeera

Romania could face near-40% population plunge by 2100: UN. (Romania Insider

Washington bars eight Cuban officials from entering US. (Reuters)

Two journalists burned alive by gang in Haiti. (CNN)

Venezuela’s U.S.-backed opposition frays as Nicolás Maduro tightens grip. (WSJ

Argentina’s opposition refuses to attend meeting on IMF talks. (Buenos Aires Times

Argentine bonds slump as economy chief criticizes IMF proposals. (Bloomberg)

Welcome to Frontier Markets News

Sign up to receive our frontier and emerging markets newsletter.

We don’t spam and we won't share your info!

Leave a Reply

Your email address will not be published. Required fields are marked *