All Coface Publications
Expertise & agility: We believe that trade is the driving force behind value creation and stability on a worldwide scale, but it is a risky and complex world out there. That is why it is our job to help you make the right decisions, so you can get on with growing your business without any disruptions. Because each market is unique, there are two essential dimensions to how we operate: expertise and agility. Our employees are ready, willing and able to assist in more than 100 countries where Coface can support you.Read More
In 2018, the Netherlands were the sixth-largest goods exporter in the world. In the service-exports category, the Dutch placed eighth in 2015. Considering exports relative to GDP, the Netherlands took third place in 2015 (right behind Ireland and Switzerland). However, times have changed...Read More
Despite improving economic performances across the Gulf Cooperation Council (GCC), monetary and financial conditions remain tighter compared with before 2015. Access to financing remains one of the key issues for companies, particularly for small- and medium-sized enterprises (SMEs). Loan growth in the region has recovered somewhat thanks to higher oil prices, but it remains below its historical average.Read More
13 major sectors assessed worldwide. Coface assessments are based on 70 years of Coface expertise and on the financial data published by listed companies from 6 geographical sectors. 5 financial indicators are taken into account: turnover, profitability, the net debt ratio, cashflow, and claims observed by our risk managers.Read More
The first part of 2019 was marked by the decline in world trade, which will decrease in volume over the year as a whole according to our forecasts (-0.7%), despite a slight recovery expected in the second half of 2019.Read More
During the first four months of 2019, the rate of corporate insolvencies in France increased by +0.8%. This rate was particularly high during January and February, mainly due to the repercussions of the "gilets jaunes" (yellow vests) movement; however, the increasing rate of insolvencies declined in March and April. Nonetheless, Coface anticipates that, despite resilient economic growth, insolvencies will increase by +1.7% over the whole of 2019 (…)Read More
China has rapidly become a big player in 5G technology, thanks to the government’s strategy and its support of high investment in Research and Development (R&D). This new technology is part of the Made in China 2025 initiative, through which the Chinese government targets self-sufficiency in high-end industries. China coordinated its approach to 5G and some successes are already visible. For example, 40% of global patents for current 5G network standards are from Chinese firms. Moreover, Chinese companies are set to benefit from 5G. Huawei is the global leader in network infrastructures; it currently holds 29% of the market (...)Read More
The luxury market is unique, mainly due to the fact that its products are consumed for social distinction. This has helped companies in the segment to outperform other sector-segments over the past years. Nevertheless, the luxury market is facing important challenges, notably regarding counterfeit products, a risk for companies, and e-commerce, which is disrupting how business is conducted. In addition, the market is not immune to challenging economic conditions. Global economic activity is currently experiencing a slowdown: Coface forecasts a global GDP growth rate of 2.9% in 2019 after 3.2% in 2018, and this will have an impact on some luxury products. Looking ahead, the rise of emerging markets’ middle classes – especially in China – presents great opportunities. Despite global economic slowdown, we are therefore expecting the luxury retail market overall to be resilient, notably benefiting from the rise of Chinese consumers’ appetite for luxury.Read More
In the context of a global oil market that is likely to remain volatile, the two largest Latin American economies – Brazil and Mexico – are expected to implement significant changes in their energy policies in the medium term. Both countries have appointed new presidents in the last year following polarised elections: in Brazil the right-wing president Jair Bolsonaro took office in January 2019, while December 2018 saw the arrival of left-wing André Manuel Lopez Obrador (AMLO)1. Similarly, the two oil industries share two main common features: their state-owned companies have experienced significant financial and governance issues, and both countries are crude oil exporters and net oil derivative importers. Conversely, in terms of energy policies, they appear to be taking opposite directions.Read More
The Chinese economy experienced some challenges in 2018 . Corporate bond defaults in US dollars quadrupled, reaching an amount of USD 16 billion, while the number of bankruptcy cases settled through the Supreme Court of the People’s Republic of China spiked to 6,646 (...)
Despite the many obstacles in its path (diverse and varied political risks, high volatility of commodity prices, supply constraint s in advanced economies, to name but a few), world growth in 2018 managed to sustain its 2017 rate (3.2%)Read More
A favourable economic environment was not enough to reduce company insolvencies in Central and Eastern Europe (CEE). While average GDP growth accelerated to 4.5%, i.e. the highest level in nine years, insolvencies increased by 6.4%.Read More
With Greece about to pull out of its third bailout package, signs of economic recovery are multiplying: 2017 was a year marked by the return of positive growth (+1.4%), and - despite weakening growth in the eurozone - Greek GDP growth is expected to be close to 2% in 2018, with Greek households and businesses remaining more optimistic in the first half of the year than in 2017.Read More
This is the first corporate payment survey in Turkey aiming at indicating how payment terms stand in different sectors, how companies manage credit management practices and evaluate future payment experience (...)Read More
Despite regional conflicts, the 2007-08 financial crisis, and the 2009-11 eurozone crisis, Western Balkans countries have developed a close economic proximity with the European Union via a number of regional and bilateral agreements. However, due to institutional, economic, and diplomatic obstacles, accession to the EU will be a long process. At the same time, due to the region’s strategic importance and with the reinforcement of membership conditions, accession (or a pre-accession status) is likely to happen – especially as membership would divert the region from other
interested parties (Russia, China).
The Chinese economy staged a comeback in 2017. GDP ticked up from 6.7% in 2016 to 6.9% in 2017, favoured by strong demand, as well as loose monetary and fiscal policy settings. As a result, risk managers have become more complacent, both in terms of their economic expectations and their risk management procedures.
Infographics - French organic food sector: how can it increase scale without abandoning its original principles?Read More
The UK automotive industry is entering a dry period. The voices of the main UK industry representatives and their concerns regarding the negative effects of a potential hard Brexit appear to remain unheard (...)Read More
While more than 30% of respondents said in 2015 that that the time between the transmission of invoice and collection was between 30 and 60 days, this share decreased to 24% of respondents in 2016 and 11% of respondents in 2017.Read More
Central and Eastern Europe: Less business insolvencies despite temporary headwinds in the construction sectorRead More
Political changes in the US have caused uncertainty over the trade policies that could be implemented and the region’s vulnerability to tighter financial conditions. Since Donald Trump’s victory, the currencies of many emerging countries have fallen against the dollar. Mexico’s currency was the most greatly affected in the world, with 19 % depreciation against the USD in 2016Read More
Labour markets in the Central and Eastern Europe (CEE) region are continuing to improve.
Unemployment rates have reached the lowest levels ever recorded and most CEE economies are enjoying lower unemployment than the EU average
RMB depreciation, capital flow measures and new monetary stance - What are the implications for Chinese corporates?Read More
Coface’s payment survey confirms that sales on credit are being extensively used by Polish companies. Although credit periods have become common practice, it does not mean that receivables are being paid on time.Read More
South Africa’s growth performance has been in decline since the global financial crisis. Since peaking in 2011, the growth rate (hit by lower commodity prices and power supply problems) has continued to slow.Read More
Turkey’s economy experienced several shocks during 2015 and 2016. Heightened political uncertainties, regional tensions, the US rate hike process, the credit rating downgrade and domestic security issues, have all resulted in (...)Read More
For this quarter, the result is clearly negative once again, as eight sectors have been downgraded and only one upgraded. The changes concern North America (increased risks in the retail, textile-clothing, paper-wood and transport sectors), Western Europe (downgrade of the agrofood sector) and Central Europe (downgrades for construction and IT & communications, but an upgrade for the transport sector) and Middle East (downgrade for IT & communications).Read More
Despite the silent impact of the first arrow on Japan’s exports, the operating profits of Japanese manufacturers which have been mainly exported oriented surged, in part due to their pricing-to-market behaviour.Read More
Poland has seen a slowing of its economy this year, compared to 2015. Nevertheless, growth is still continuing at a fair rate and, in fact, remains at a level which many other economies can only dream of.Read More
French growth has taken a time-out in Q2. The political uncertainties in the United Kingdom, the strikes in May and the floods affecting Ile-deFrance are all likely suspects responsible for this surprise halt. However, the figures are expected to recover in Q3.Read More
The importance of the Agrobusiness sector varies between the different North African economies. While on a regional level, the sector leads exports, on a country basis it differs. In Morroco, agribusiness benefits from government subsidies, as it contributes nearly 16% of GDP and provides employment for 40% of the population. Overall, across the main north African countries, the lowest level of risk is in Morocco...Read More
In the light of the on-going structural reforms, the "tale of two Chinas" is resulting in sector wise winners and losers, linked to their growth potential in the medium and longer term, government policies and structural demand.Read More
Coface updates its risks outlook for 12 business sectors in 6 regions every quarter. For the first time, these regional assessments are accompanied by detailed sectoral assessments for 17 countries (see appendixes page 6): United States, Japan, Germany, France, United Kingdom, Italy, Spain, China, India, Brazil, Mexico, Poland, Russia, Turkey, Saudi Arabia, UAE and South Africa. While the "balance of risks" currently seems to be more even than in Q1 (6 downgrades for 7 upgrades, compared to 9 downgrades for only 2 upgrades in Q1), it continues to mask marked differences from one region to By Coface Group Economists the next. In particular, sectoral risks continue to increase in the emerging world, where 5 of the 6 downgrades have been noted, whereas they have fallen in Europe despite the risks linked to the result of the British referendum.Read More
Sluggish global growth, characterised in particular by China's loss of momentum, shock to commodity prices… Sub-Saharan Africa has not been spared in the global tempest and seeks to maintain growth against wind and tide. The commodity producers are the most affected.Read More
Bankruptcies drastically decreased in almost all countries in the region during the course of last year - especially in the four Northern Europe Region (NER) countries we focus on in this panorama, namely Germany, the Netherlands, Sweden and Denmark.Read More
Brazil: a country in deep recession looks tentatively towards the first steps of the new government.Read More
Sluggish growth, absence of inflationary pressures, ever more expansionary monetary policies and increased volatility in financial markets; these are four elements characterising the global economy in early 2016 (...)Read More
Since 2003, Coface has been conducting annual surveys on business payment experience in China. In 2015, the average credit termes offered by China-based firms decreased again, reflecting a more prudent approach to granting credit facilities to customers. the overall payment experience in China deteriorated and remained very challenging in 2015.Read More
After five years of sanctions, Iran is finally to rejoin the global community. The return of Iran should have an effect on international growth through the oïl channel but above all, will bring huge changes to Iran itself. International sanctions have impacted the Iranian economy. Two consecutive years of negative growth and runaway inflation have tested Iran’s resistance model to its limit. The lifting of the EU embargo will allow Iran to revive its oil sector and return to the global market. The country is perceived as a new Eldorado, with its 78 million potential consumers.Read More
The German economy has changed its growth model during recent years. While internal demand (especially private consumption) – was sluggish and weak throughout most of the 2000s, it is currently the (...)Read More
After US households in 2007-2008 and Eurozone states in 2011-2012, emerging countries are now getting their turn at the epicentre of the storm, in part because of excessive debt. How did that happen? Growth cut in half in the emerging world between 2010 and 2015, highly expansionary monetary policies after the Lehman Brothers crisis, and the drop in commodity prices since mid-2014 are all part of the answer.Read More
During 2015, Turkey’s economy faced several challenges.
On the political scene, the country went through two elections in 2015, bring to four the number of elections over the last two years. After talks to form a coalition government fell through following the June 7 general election, the country returned to the polls on November 1. The combination of greater political uncertainty, security issues and global economic worries caused a sharp depreciation in the lira, which hit its alltime weakest level against the dollar in September.
Retail trade benefits from good prospects of consumer demand which, however, will not eliminate challenges for the sector including an intense competition and the implementation of new levy for retailers. Foreign chains will remain dominant taking an advantage of their large-scale bargaining position and offering the most attractive prices for consumers even despite being charged by the new tax.Read More
Amongst the 14 business sectors monitored in three main regions of the world (Western Europe, North America and emerging Asia), three were downgraded during the third quarter of 2015: metallurgy in Europe, retailing in North America and textiles-clothing in emerging Asia.Read More
Tenuous but confirmed. These are the terms that best describe France’s current growth - as illustrated by the figures for the third quarter, published in early November. Household consumption has increased, even if only modestly, due to gains in purchasing power as a result of almost zero inflation and despite the ever-rising unemployment rate.Read More
Brazil has grown over the last decade, as a result of the boom in commodity prices and strong household consumption. The country endured the 2008-2009 crisis, thanks to liquidity injections from public banks.Read More
The increased economic activity in Poland already reached levels required to stabilise the number of company insolvencies. The current global economic situation could be summarised as a gradual recovery for advanced economies and turbulent times for emerging countries.Read More
Despite competition from China and the end of subsidies, the revival of the European photovoltaic industry seems likely.
Although photovoltaics only accounts for 5.3% of total electricity consumption in Europe, this sector has benefited from worldwide momentum in favour of "greener" energy consumption. Between 2004 and 2012 European electricity from photovoltaics increased sharply, from 0.7 to 62.4 billion KWh. This growth was driven by Germany, Spain and Italy, where 80% of Europe's photovoltaic facilities were located. The sudden expansion of photovoltaics was made possible by favourable government policies (a system of renewable purchase obligations and subsidies), plus the sharp and continued drop in the price of installations, intensified by Chinese competition. Europe led the field at that time, accounting for 75% of worldwide production in 2012.
In a context of low growth, the global sectoral dynamics are mixed. In this overview we analyse five major sectors: automotive, energy, metals, information and communication technologies (ICT) and paper-wood, in North America, emerging Asia and in Western Europe.Read More
The Chinese economy has been in the spotlight for several months: devaluation of the yuan, stock market collapse, falling property prices, fears of an excessive economic slowdown, doubts about the reliability of published data and, more generallyspeaking, uncertainties about the rebalancing process the authorities have launched. In this anxiety-provoking environment, other Asian countries seem to be the first potential victims in the event of a hard landing for the Chinese economy.Read More
For the fourth consecutive year, global growth will fail to exceed 3%. At the beginning of the year however, this target did not appear unattainable, as the highly expansionary monetary policies in place, combined with the fall in the oil price and less restrictive fiscal policies, were expected to effectively accelerate growth. But this was not the case. Who is at fault? Chiefly the emerging markets, with Russia and Brazil in deep recession, and with growth slowing down more rapidly than expected in China, while failing to take off in South Africa or in Turkey.Read More
What are the impacts of lower oil prices on the gulf countries economy. Focus on Saudi Arabia, the UAE and Bahrain. What are the diversification strategies and the region’s integration with international trade. Focuses on the food and beverage sector in the UAE and automotive sector in Saudi Arabia.Read More
Growth in Latin America has been slowing down since 2011, and was estimated at 1.2 % in 2014 . This lacklustre result, caused by weak domestic fundamentals, were exacerbated by cyclical factors such as the decline of commodity prices - and particularly the plunge in oil prices experienced since the second half of 2014.Read More
In this first overview of company insolvencies in Europe, Coface examines the following question: Was the return to growth observed in Europe strong enough to bring about a lasting reduction in business failures? For 10 out of the 12 Western European countries studied, the answer is «yes».Read More
The CEE region has become an attractive destination for investments by global car manufacturers. In 2014, 3.6 million vehicles were produced in Eastern Europe, equating to 21% of total EU production. In the CEE countries covered by Coface´s analysis there are 33 car factories, most of which were created by foreign direct investment (FDI) inflows. The analysis shows that despite high dynamics of car sales generated by local clients recently, CEE factories remain highly dependent on foreign demand.Read More
After a decade of well-implemented reforms and high growth rates, the Turkish economy seems to be struggling to maintain the same growth performance. Coface expects a growth rate of 3.5% this year - still a solid rate, yet below the potential growth rate estimated at 5% and lower than some of the country’s peers.Read More
"Company insolvencies stabilized with a just minor drop by 0.5% as the regional average. Our scenario assumes that companies should experience further gradual decline of insolvencies this year facing good prospects for internal demand and more visible recovery of Eurozone as the CEE’s main trading partner."Read More
This barometer sets out the latest trends for company insolvencies for the first four months of 2015 in France. After a 2.9% fall recorded for 2014, a level not observed since 2010 (-3.8%), the first four months of the year were marked by a rebound in insolvencies.Read More
Coface conducts an annual survey to examine corporate payment trends and experiences in the Asia-Pacific region. In 2014, the survey was conducted in 8 economies – Australia, China, Hong Kong, India, Japan, Singapore and Taiwan, as well as, for the first time, Thailand. The study revealed some key indicators that showed signs of a (...)Read More
The changes in our sector assessments reflect the development of the world economy since the end of 2014, marked by the appreciation of the dollar against other currencies, the oil price collapse and gradual recovery in the Eurozone. These trends have had repercussions on most of the sectors we track.Read More
The automotive sector in the US, deeply impacted by the onset of the 2007 crisis, seems to be currently a part of a virtuous circle.
As the car sales are on an upward trend, some risks could derail the sector economy, though.
In this panorama we first set out a study examining how the advanced economies are facing up to the challenge of weak economic growth since the Lehman Brothers collapse, that is for the past seven years now! Some observers are even talking of "secular stagnation". But, in our view, not all the advanced economies are facing the same challenges regarding this risk of longterm stagnation. We believe that (...)Read More
The Czech Republic is back on fast track. After falling into recession in 2012 and 2013 due to sharp fiscal consolidation and sovereign debt crisis in the Eurozone, the economy regained momentum reaching solid growth rate of 2.0% in 2014 and should gain speed with (...)Read More
Ongoing economic scenario in Brazil remains sensitive, Coface expects GDP to break even in 2014 and activity should contract by 0.5% in 2015. Industry dropped by 3.2% in 2014 and will probably record another negative year in 2015. The year has just started, but it may reserve some negative surprises.Read More
Coface conducts an annual survey of payment experience in China. With 80% of the survey respond-ents shared overdue experience and 56.7% of them saw an increase in overdue amount over the past year, the overall payment experience in China remained very challenging in 2014 (...)Read More
Latin America is a major producer of commodities and recent drop in oil prices is impacting countries of the region in different ways. Some of them may benefit from lower international quotation, others are negatively impacted already in the short term and finally a third group could be affected in the medium term only.Read More
How do the Middle East and North Africa (MENA) economies perform after the social and political turmoil caused by the so-called "Arab Spring" late in 2010? Have social and economic demands of protesters resulted in a healthier economic outlook in these countries?Read More
Disclosure of the exit strategy by FEDChairman Ben Bernanke in May 2013 triggered a new period marked by a change in the risk perception towards developing economies in financial markets. Turkey entered this period with a high current accounts deficit, a production sector substantially dependent on imports and three successive elections.Read More
Three decades ago Latin America used to be known by negative terms such as dictatorship, debt crises and high inflation. The region's GDP increased by an annual average of only 1.5% in the 1980s. One decade later the rate rose to 2.4% and finally achieved 4.2% between 2003 and 2013. Over the years Latam has begun to be associated with economic growth, new middle class, poverty reduction and controlled inflation.Read More
This end of year panorama starts with the risk assessment of 14 sectors in the three regions we monitor. North America is witnessing major evolutions. Our assessments in this region are improving for chemicals, transportation and textile-clothing. These three sectors are benefiting from the good shape of the American economy and from the fall in oil pricesRead More
The single European Union (EU) market for air transport was formed only in 1997. Since then, the traditional airlines have had to compete with low-cost carriers on their short and medium-haul flights.Read More
Activity in Brazil remains lackluster, inflation stands above the target, interest rates are among the highest in the world, confidence remains at a low level across a variety of indexes and the well-known low investment ratio continues to deteriorate. What is the impact on companies’ payment capacity?Read More
After five challening years Romania’s economic performance proved that it has become one of the leaders of the European recovery and exceeded expectations with GDP growth rising by 3.5% in 2013. However, the slowldown of the growth in 2014 shows another picture.
From 2004 to 2008 Brazil had grown, on average, by 4,8% a year, but in the former period, from 2009 to 2013, the average rate declined to 2,7%. The country did not take advantage of the good winds to make important reforms, such as improving the infrastructure and the business climate...Read More
New barometer of companies insolvencies in France : a lull is observed from January to April 2014, the number of insolvencies falling by 2.3%. This barometer is followed by a comparison between the situation
of SMEs in France and Spain.
The group’s 2013 activity report is available. Besides elements on 2013 performance, the report contains general information about Coface, missions, governance, businesses, offer and analysis of the world macroeconomic situation.Read More
A broad spectrum of exciting reform plans have been announced, and the government had a series of follow-up actions. But in the near-term, potential negative impacts on the real economy as a result of the reform effort and credit risks associated with the rising cost of fund have to be watched out for.Read More
Textiles - Upmarket positioning and innovation: Key to the success for the French and European textile industry?
You will find in it our usual barometer, which assesses the risks to which companies in fourteen key industrial sectors in emerging Asia, North America and Western Europe are exposed.
We have also included an analytical focus on European textiles. This traditional industry was affected very early by globalisation, and, in particular, competition from developing countries.
In this Panorama, you will find the Coface barometer, which analyzes the evolution of French insolvent companies between November 2012 and October 2013.
We then publish a study on insolvencies in the French construction sector, overrepresented in insolvencies compared to it weight in the economy.
This panorama contains a study on household consumption in Asia. How big is the rise in household consumption in this region? Have Asian households taken on too much debt? What are the specific consumer behaviour patterns in Asia? Which sectors are benefitting most from this expansion of consumption?Read More
This Panorama includes our global sector barometer, which analyses the situation in fourteen key economic sectors in three of the world‘s major regions (European Union, North America and Emerging Asia) through a single credit risk indicator. In Europe, sector risks continue to deteriorate, especially in chemicals due to the remaining difficulties in the European industry, and also in the pharmaceutical branch due to the fiscal tightening measures taken by the governments.Read More
Ranked seventh in the world (and the second largest emerging economy) by GDP size, Brazil is the archetypal emerging country. But, the Brazilians’ legendary optimism has been sorely tested for the last two years: Can the Brazilian economic engine be repaired?Read More
This new Panorama contains the results of our Company Insolvency Monitor from April 2012 to April 2013 and the results of a study on insolvencies among Eastern European countries, a region experiencing a sharp rise in insolvencies rate.Read More
Coface releases a series of economic reports and is pleased to announce the publication of its second Panorama sector report. Readers will find in it a global sector barometer which analyses the situation in fourteen key economic sectors. The originality of the analysis is that it is based on aggregating the accounts of 6,000 companies in three of the world’s major regions: the European Union, North America and Emerging Asia.Read More
In this Panorama, Coface highlights the radical transformation of risks in emerging countries. While traditional country risk (sovereign risk, external vulnerability) has appreciably declined, three new risks are appearing and need to be monitored.Read More
The 17th Country Risk Conference held by Coface on 22 January 2013 has confirmed the complexity of a situation where, more than ever, the world seems to be «split in two»: advanced versus emerging countries.Read More
Investors have made it one of their favourite havens during this period of recurrent crises, from global finance to sovereign debt in the eurozone. Proverbial political stability, sound management of public finances, a complex but attractive tax system, many very innovative small businesses and a flexible labour market. Not forgetting, of course, a renowned financial market, making it a major player on the international scene in wealth management activities. These are strengths which sometimes turn into weaknesses.Read More
When public sector job creation runs out of steam, eyes turn to the private sector, which alone seems able to offer a solid basis for recovery in the months to come through investment and the hiring of workers.Read More
Although the overall number of insolvencies continues to decline (-1.8% between September 2011 and August 2012), the summer of 2012 confirms the trend that began last Spring with an important growth in their cost (+17%) and a correlative increase in unemployment (+3.3%). The barometer presented in this panorama analyses this development, principally caused by the difficulties of larger French companies. A list is also given of the riskier sectors, those where risks are deteriorating and those which have been relatively spared.Read More
The United States remains the planet’s leading economic power. As evidence, one need only consider the simple fact that the US consumer accounts for 70% of the US economy and 18% of global GDP. The economic spotlights are therefore focused for very good reasons on rising petrol prices, falling housing prices, unemployment and unequal profit distribution, all of which undermine household confidence. The outcome of the political debate between the Republicans and Democrats over the US budget and national debt as well as the Fed’s orientation and monetary policy as from July are therefore also under close scrutiny.Read More
In Southern Europe, the recession is deepening, particularly in Spain, Italy and Cyprus. Coface is forecasting a recession rate of 2%, 1.8% and 1.3% in these countries respectively in 2012. Another source of concern is the eurozone sovereign debt crisis, which is now affecting growth in emerging countries, where Coface has noted a slowdown in activity.Read More
The «Arab Spring» was rather mild in Morocco, compared with what is still going on in other countries in the region. This results from the role of the king, the Commander of the faithful, but also from the fact that leaders in Morocco have attempted to anticipate the rise of unrest and discontent.
Today, the country has a true asset with its manageable external indebtedness and its solid and dynamic banking sector.However, despite true economic and social progress, and despite the benefits that it derives from phosphates, tourism and better infrastructures, Morocco remains a rural, poor and insufficiently diversified country.
Greece quitting the eurozone would be disastrous. But this long unthinkable scenario cannot be discounted. Even though its likelihood remains below 50%, policymakers cannot afford to sweep it under the rug considering the severity of the Greek financial and economic crisis and the difficulty of implementing unavoidable reforms. This article draws lessons from the financial crises in Russia (1998) and Argentina (2001/2002) in exploring the likely advantages and disadvantages for Greece of withdrawing from the eurozone. What then would be the risk of propagation to the peripheral countries and the consequences for the eurozone as a whole?Read More
Like at the beginning of each year, Coface organized its 16th conference in Paris on 16 January 2012, which has become the flagship event in the field of country risk, one of its main areas of expertise. An exercise, particularly challenging for 2012.Read More
Italy’s economy – the third-largest in the euro zone – is well diversified. Yet the country is currently at the centre of the debt crisis plaguing the single currency zone. Of course, many of the economy’s fundamentals appear sound. The budget deficit did not deteriorate significantly during the crisis, the growth in industrial added-value and a niche strategy help to limit the trade deficit, and household indebtedness is relatively low. But the deterioration in the country’s economic growth potential due to structural weaknesses and the crushing weight of the public-sector debt in a very uncertain international environment are all cause for concern. Given the vast size of this debt and the fact that it is widely held by the European banking sectors, a default by the Italian government would have incalculable consequences on the euro zone’s future. However, the recent formation of a government of experts led by Mario Monti, an economist and former European Commissioner, provides some reassurance of rigour which is a step in the right direction.Read More
After their surge in 2007/2008, prices for farm raw materials began to soar again in June 2010, affecting foodstuff prices worldwide with particularly sharp increases in emerging countries. No other asset class registered jumps in prices as spectacular as those recorded by some farm raw materials with grain prices skyrocketing 36% year-on-year through August. Sugar prices also soared, up 50%. Prices for meat (beef, mutton, chicken) and dairy products rose over 15%. The price increase for rice was more modest with that commodity not traded on the futures market and only a small fraction of its production traded internationally.Read More
Disappointing growth figures for the second quarter of 2011, political tensions in the United States this summer around the question of the debt ceiling and the loss of its triple-A rating, the never-ending sovereign debt crisis in the eurozone, the persistent lack of confidence on the financial markets, tensions on the money market and the vertiginous fall of bank share prices: So many negative signals that are likely to affect the global recovery observed since mid-2009. Global growth in 2011 will settle at 3.2%, representing a slowdown of 1.1 point of GDP compared to 2010.Read More
Global 2011 growth now stands at 3.3% against 3.2% in March. Growth forecasts for industrialised countries are almost unchanged at the projected 1.8%, a net slowdown compared to the 2.5% increase recorded in 2010.Read More
Various events that marked the first quarter 2011 prompted us to revise our world growth forecast for the year, down from 3.4% to 3.2%. And based on virtually finalized data for the fourth quarter 2010, world growth for 2010 comes to 4.2%.Read More
Worldwide growth should be robust in 2011. But how can we analyse its driving forces and risks? Between the United States, where the recovery is hiding the weaknesses of an economic model that is overly based on debt, Europe, weakened by its heavy public debt and eroded competitiveness, and the emerging countries whose dynamism is continuing but needs to find new balances, decision-makers more than ever need reliable decryption and analyses to find their way.Read More
Global Construction: Substantial Geographic Differences, High Sensivity to Economic conditions, Permanent Credit Risk
The global construction sector is a kaleidoscope of diversity with substantial differences between countries and even between the regions of a given country.The sensitivity to changes in economic conditions also varies widely. In general,payment incidents involving actors in the sector are not uncommon. This surveyis intended to enable international trade actors to gain an awareness of the risksand opportunities that characterise this market.Read More