Emerging and Growth Markets

Emerging and Growth Markets

Over the past two months, the Merval is up by more than 40%, the largest two-month percentage gain since late 2014.

Latin America

Argentines hope new president will resolve country’s economic crisis. Argentines have voted the once-disgraced nationalist Peronist movement back into power in a move that has far-reaching consequences for international creditors and the future of a trade agreement with the European Union, Ryan Dube reports. Alberto Fernández, a Peronist veteran, got 48% support in Sunday’s election, eliminating the need for a runoff vote against his defeated rival President Mauricio Macri.

Mr. Fernández will inherit an economy in tatters and will face a range of tough challenges when he takes office in December. In particular, he must reconcile his campaign-spending promises with the strict fiscal demands of the longtime nemesis of the Peronists: the IMF, Santiago Pérez and Ryan Dube report.

Argentina’s government is already on the brink of insolvency, saddled with more than $100 billion in foreign debt, and fast-dwindling dollar reserves. To stave off default, Mr. Macri’s government secured a $57 billion IMF bailout in 2018, the largest ever by the fund, adding substantially to the country’s obligations.

Investors seem unperturbed. Argentina’s stock market continued to surge this week, with the benchmark Merval Index tacking on more than 20% in October, according to Dow Jones Market Data and FactSet. Over the past two months, the Merval is up by more than 40%, the largest two-month percentage gain since late 2014.

Former president tries to turn the tables on Bolivia’s leader.Carlos Mesa, the politician leading the opposition against Bolivian President Evo Morales, is attempting to use street tactics and international pressure to force Mr. Morales to face him in a December runoff, John Otis reports. The incumbent is claiming he won a fourth term in the first round of voting on Oct. 20, though electoral monitors say the process was rife with irregularities.

Early returns as well as an independent quick count indicated Mr. Mesa would receive enough votes to force a runoff against Mr. Morales. That is when the Supreme Electoral Tribunal suddenly stopped publishing results for nearly 24 hours.  When the vote-counting resumed, the president’s lead gradually increased to 10 percentage points, the amount needed for outright victory. Observers from the Organisation of American States questioned this sudden shift in the voting trend and recommended that the winner be decided in a runoff.

Bolivia said on Sunday it agreed with the OAS to allow an audit of the election.

On Monday, for the eighth-straight day, thousands of Bolivians heeded Mr. Mesa’s call to take over the streets of La Paz and other cities. One of the protesters, political consultant Krupskaya Oña , said Mr. Mesa has finally risen to the challenge of leading the movement.  “He used to be bookish and timid,” she said. “But now he’s an icon of democracy because he’s the only one left who can challenge Evo Morales. ”

Chile protesters’ grievances shift to inequality. What began as students hopping turnstiles over a 3.7% rise in subway fares has morphed into mass protests about an array of concerns, including a growing sense of injustice, Juan Forero writes.

A demonstration last Friday drew more than a million people into the streets of the capital, Santiago, and brought the government closer to a reckoning. Looters have destroyed hundreds of shops and supermarkets and 20 people have been killed. At least 11 of the dead were found in stores set ablaze by arsonists.

The country’s President Sebastian Piñera announced he would reshuffle his cabinet to quell the protests, but demonstrations have continued. In a deeply researched story, Forero explains why Chile’s middle class feels it’s been betrayed by the country’s leaders.

 

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