We present estimates of Venezuela’s external debt, which more than doubled in the last decade. Nearly half of Venezuela’s debt sits with PDVSA. Non-bonded debt, especially bilateral loans, is high. External debt rose sharply relative to exports, and, on this metric, is very high relative to peers.

Growth momentum continues, albeit at a slower pace in 2019 and 2020. Capital inflows will cushion pressure from weaker current accounts. Fiscal deficits and trade tensions are the main risks to the outlook.

Portfolio inflows to Emerging Markets were $26 billion in February. Equity and debt inflows reached $14 billion and $12 billion, respectively. Net capital flows strongly rebounded into positive territory in January.

Despite hopes for a continued “v-shaped” equity market recovery, investors are hedging their bets; Highly procyclical U.S. fiscal stance in sharp contrast to other mature economies; “Shadow banking” on the rise around the world—though not so much in the U.S.; Record pace of buybacks by S&P500 sparks more debate about their merits

Our EM FX fair value estimates update prompted lots of questions on the inner workings of our model which we lay out in a series of equations and a summary table in this piece.

EM bank lending conditions tightened less in 2018Q4. Access to trade finance resumed easing in Q4, as other lending categories tightened by less. EM Europe saw their conditions improve the most, while EM Asia began tightening, so that only SSA saw easing. Respondents expect easing in lending conditions for 2019Q1.

Average growth in MENAP is foreseen to decelerate slightly to 2.2% in 2019—below the population growth. This aggregate picture, however, hides considerable heterogeneity in economic paths across the region. Non-resident capital inflows to MENAP should rise marginally this year to $189 billion.

China’s imports of US goods fell sharply last year, in response to new US tariffs on Chinese goods. We attribute the decline to a retaliatory 25% tariff, but data suggest non-tariff measures were also used. China substituted certain US imports markedly, in favor of countries like Russia and Brazil.

South Africa’s Budget 2019 includes adjustments, which are markedly offset by sizable bailout funding for Eskom, leaving the government’s deficit targets to widen compared to those presented last October. The worsening fiscal position and rising public debt are key risks for the credit rating.

Angola is seeking to make its growth model more sustainable, inclusive, and diversified. An IMF program has started, and policy adjustment is underway, but benefits will take time to accrue. Evidence connecting key figures to a Mozambican scandal may limit the credibility of the reform drive.