The Brazilian government withdrew $255 million from its sovereign wealth fund to finance public accounts, according to Newsmax. The fund was created in 2008 out of the commodities boom, but harder times forced authorities to withdraw money in 2012 to meet budget obligations. The latest withdraw comprised a third of the fund’s overall worth.
The International Monetary Fund (IMF) has turned a critical eye to Iran’s return to the international markets following years of economic sanctions that had cut it off from much of the rest of the world. In particular, resurgence in Iranian oil exports in 2016 could have dire consequences for crude oil prices, which have already sunk in price over the last year. According to the IMF, the surge of Iranian oil supply on the market could push down prices by as much as $5 to $15 a barrel.
Real GDP rose 2 percent in the third quarter, after rising 3.9 percent in the second quarter, a sharp deceleration that analysts expected despite lower energy costs that have failed to stimulate personal consumption. According to the Bureau of Economic Analysis, the growth in GDP was partly due to a better-than-expected environment for investment, as inventories fell less than feared.
North Korea may contend with a serious famine in 2016 due to a prolonged drought that failed to yield substantial crop production, according to UPI. Analysts predict that the government will have to make cuts to its nuclear program to foster economic reforms or make concessions to the international community in return for assistance, but there is a chance that leader Kim Jong-un may ramp up nuclear capabilities as the economy falters.
The World Bank has come under fire recently for policies and practices that many consider shortsighted and insensitive to the less fortunate. A glaring example involves the World Bank’s failure to provide oversight of development projects that force people from their lands and/or harm their means of making a living. However, after years of delay, the World Bank has announced that it will take action to address these social issues.
Oil prices plummeted to their lowest point in 11 years, prompting fears that energy companies will prove unable to pay back loans, which could cause rippling financial weakness throughout the global economy. Brent crude oil prices fell to $36.52 during Monday trading in European markets, while global supplies, especially in the United States, remain at record high levels.
Prime Minister Mariano Rajoy’s center-right Popular Party endured a heavy blow over the weekend, falling short of the seats needed to govern accordingly, but still maintaining a majority, notes USA Today. The ruling government will have to share power with opposition parties, but the process will remain contentious, as incumbent officials must govern alongside leftist parties. King Felipe VI will act as broker and nominate a prime minister for approval by parliament.
A new treaty between the United States and Mexico promises to greatly expand air travel between the two neighbors. U.S. and Mexican authorities believe this will lead to a boost in travel, shipping, and economic exchange between the two nations. Meanwhile, air carriers have roundly supported the treaty, anticipating substantial additions to their annual revenues.
Calls for a boycott of Thailand’s fish and shrimp products have grown as a new report shows child slavery and human rights violations remain common in the country’s seafood industry. An in-depth report by the Associated Press detailed working conditions in which children peel shrimp for several hours for little-to-no pay alongside adults who are held in captivity and forced to work.
Mozambique fails to improve economically as the southern African nation suffers from low commodity prices and overindulgent spending, according to AFP. The currency fell to a record 35 percent in 2015 against the dollar.
The government recently borrowed $286 million from the IMF, but it will not prove sufficient to save Mozambique from mounting issues—most notably the staggering debt. Public debt will climb to 60 percent of GDP as the year draws to a close. Further, donors and investors grow concerned over Mozambique’s finances and overall direction of the country.
