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By Ken Stibler, Noah Berman, Nojan Rostami and Mariel Ferragamo. Executive editor: Dan Keeler

Africa

Botswana votes out longtime incumbent

Voters in Botswana’s presidential election this week chose opposition leader Duma Boko over incumbent Mokgweetsi Masisi, whose party has been in power for 58 years since the country’s independence. Boko’s Umbrella for Democratic Change party promised to introduce a new economic strategy that better distributes wealth, addressing criticisms of Masisi’s Botswana Democratic Party, which has been accused of sustaining a system that channels the country’s mineral wealth to an elite few.

Botswana has long been regarded as a country with a strong democracy and stable economy, but a recent dip in the global demand for diamonds, one of the country’s pivotal exports, has led to a sharp rise in unemployment. Concern over the health of Botswana’s economy was a major reason for the shift in leadership this week.  

By Friday, the BDP had won only four parliamentary seats—down from 38 in the previous election—and Masisi announced he would hand over the office peacefully to Boko. 

Ethiopia aims to sharply increase government revenue

Ethiopia has more than doubled its revenue target as part of its effort to meet the conditions for a $3.4 billion IMF financing program signed in July, Business Insider Africa reports. The continent’s second-most populous country and East Africa’s biggest economy has also let its currency float freely and implemented plans to bring more foreign investment to its financial sector and to privatize a number of state-owned enterprises.  

Prime Minister Abiy Ahmed told lawmakers on Thursday that the government plans to boost revenue from its previous target of 613 billion birr ($5 billion) to 1.5 trillion birr by imposing a value-added tax on banking services and raising telecommunications and property taxes.

Ethiopia is already making progress on raising revenues. In the first quarter of this fiscal year, Ethiopian authorities said revenue had jumped 65% compared to the previous year to reach 180 billion birr.  

Asia

Kazakhstan GDP set to double

Kazakhstan’s economy is on track to double in size by the end of the decade, Prime Minister Olzhas Bektenov said on Wednesday. The country’s GDP grew 5% last year and has already grown by 4% this year with two months to go, Astana Times reports.

The increase has been led by the agriculture and construction sectors, each of which is growing by double digits.

After the Russian invasion of Ukraine in 2022, several Western countries upped their efforts to engage with the Central Asian petrostate, bringing new economic relationships to a country where Moscow has long held influence. Other tailwinds are unrelated to politics. Last week, Lonely Planet named the country one of the best places to visit in 2025.

Exports surge from Vietnam and Philippines to US

Continuing corporate efforts to shift supply chains away from China are helping boost exports to the US from Southeast Asia, Nikkei reports. For the second straight quarter this year, the region exported more to America than to regional neighbor China.

• Vietnam says Saudi Aramco wants to invest in oil refining and petrol distribution (Reuters)

The Philippines, a US treaty ally, saw its exports to the US grow 35% year-over-year in the second quarter. Vietnam, with which the US recently upgraded ties, saw 24% year-over-year growth. Overall exports from ASEAN to the US grew 11%.

Growth was particularly pronounced in high-tech products, an area of focus for Washington. Vietnam’s semiconductor exports to the US grew by 41%, far higher than other exports.

In a sign of its further broadening its trading horizons, Vietnam this week signed a free trade deal with the UAE, a key focus of which is reducing tariffs on each other’s exports. 

Bangladesh’s Hasina ‘helped ultrawealthy siphon billions out of banking system’

The head of Bangladesh’s central bank has accused wealthy business magnates linked to former Prime Minister Sheikh Hasina of working with the country’s intelligence agencies to steal $17 billion from the country’s banking system. 

Ahsan Mansur, who was appointed as governor by the Bangladesh’s interim government after Hasina fled the country in August, told the FT that the Directorate General of Forces Intelligence, a military intelligence agency, helped force bank takeovers that resulted in $16.7 billion leaving the country. 

The allegations of cronyism come as Bangladesh looks to rebuild after Hasina’s government collapsed. The new administration is working to reclaim the taken-over banks and has negotiated a deal to fast-track IMF loans, but still must face the difficult task of uniting a population divided by the protests that ousted the prime minister just three months ago.

Middle East

Saudi Arabia intensifies push for FDI

Saudi Arabia this week played down concerns over its economic prospects as it sought to pull more foreign investment into its domestic tourism and AI sectors. At the so-called Davos in the Desert conference, the country’s government reportedly secured billions in funding pledges for tourism development and new construction megaprojects, which have this year been scaled-down due to an ongoing cash crunch in the kingdom, Bloomberg reports.

Riyadh’s sovereign wealth fund, the Public Investment Fund, announced at the conference a $70 billion multi-year partnership with Google to develop a local AI and cloud computing hub. The announcement came on the heels of an earlier pledge by the kingdom’s leading AI research hub to divest from collaborations with China, and a pivot towards the US to secure access to more advanced US technology transfers and deeper capital markets.

Revised forecasts of lower economic growth, higher budget deficits and an increasing reliance on international debt markets cast a shadow over the conference, however. Attendees were also reportedly concerned about the country’s recent admission that it needs to focus on domestic investment, particularly in infrastructure and tourism construction, to fill a shortfall of FDI.

US-supported ceasefire could help Lebanon stabilize government and markets

The US is pushing for a ceasefire agreement between Israel and forces in Lebanon that would allow the Lebanese Armed Forces (LAF) to take over the border region between the two countries, AI Monitor reports. Lebanon’s prime minister has expressed “cautious optimism” about the talks, which would reduce Hezbollah’s influence in Lebanon by removing them from the border with Israel and re-empowering the LAF to assert government control over the country’s borders, the FT reports.

The draft agreement, which envisions a greater US role as a security guarantor and a less volatile relationship between Lebanon and Israel, would be a huge step toward restoring a functioning government and capital markets access in Lebanon. While not final and subject to change, any agreement with the core function of reverting control of the borders to the LAF would be beneficial for Lebanon’s embattled sovereign bonds and currency.

Europe

Georgia’s election result heightens tensions with West

Hungary’s Prime Minister Viktor Orbán has emerged as the only EU leader to endorse the results of Georgia’s parliamentary elections as “free and democratic,” the FT reports. The election, won by the incumbent Georgian Dream party, was marred by widespread allegations of voter intimidation and ballot fraud and has drawn criticism from 13 EU nations and international observers, who have documented irregularities in approximately 10% of precincts—a significant increase from previous elections.

Opposition MPs have refused to take their parliamentary seats, calling for new elections under international supervision, as President Salome Zourabichvili joined critics in characterizing the victory as “completely falsified.”

• Putin’s Central European vanguard threatens to expand into Czechia (Politico)

The disputed outcome threatens to further derail Georgia’s prospects for joining the EU. The European Commission has already frozen €121 million in funding and is reportedly preparing to recommend against opening accession talks. The Georgian Dream party, founded by pro-Russian oligarch Bidzina Ivanishvili, faces mounting scrutiny over its democratic credentials after earlier pushing through controversial “foreign-agent” legislation modeled on similar laws in Russia and Hungary.

Upstart opposition party takes lead in Hungary

A newly established opposition party has jumped ahead of Hungarian Prime Minister Viktor Orbán’s Fidesz party in two key opinion polls, the FT reports. The center-right Tisza party, led by former Orbán ally Péter Magyar, captured 42% support among decided voters according to the 21 Research Centre, narrowly leading Fidesz’s 40% share. 

The surge reflects growing discontent with Orbán’s Russia-friendly stance and illiberal policies, which have prompted the EU to freeze €20 billion in funding and strained relations with Western allies.

While analysts note Tisza still needs to build political infrastructure before the 2026 parliamentary elections, Magyar’s rapid rise from obscurity to matching Fidesz’s support base marks an unprecedented challenge to Orbán’s long-standing dominance of Hungarian politics.

Latin America

Argentine policies bolster dollar deposits

Argentina’s tax amnesty program has attracted $18 billion in foreign currency back to the banking system, bolstering President Javier Milei’s economic reform agenda, Reuters reports. The initiative, which allows Argentines to repatriate up to $100,000 tax-free and charges a modest 5% on larger amounts, comes as the nation grapples with a technical recession and seeks to shore up its foreign currency reserves.

The government is also looking to secure a $2.7 billion credit line from private banks to help cover international bond obligations due in January. Central bank reserves have climbed to $29 billion from $23 billion this year, while private dollar accounts have swelled to $32.5 billion since the tax amnesty policy began.

Challenges persist, however. Credit-rating firm Moody’s has warned that external bond payments will double to $5 billion next year. Meanwhile, early signs of economic recovery could strain the country’s balance of payments by increasing imports, testing the sustainability of Argentina’s debt management strategy.

Incumbent LatAm leaders face falling approval

A wave of disillusionment is sweeping across Latin America as incumbent leaders face plummeting approval ratings amid escalating security concerns and governance failures. In Peru, President Dina Boluarte’s approval has cratered to a mere 5%, The Intercept reports, while Colombia’s President Gustavo Petro is grappling with corruption scandals that have forced several close allies to step down, and prompted investigations, including into his own son and the head of state oil company Ecopetrol.

Security challenges are amplifying these governance woes. Colombia’s “total peace” talks with illegal armed groups have stalled as drug cartels expand their territorial control, while Peru faces a surge in violent crime and extortion that has paralyzed major cities.

Governance issues are front and center across the region. Chile’s recent municipal elections reflect regional discontent, with President Gabriel Boric’s ruling coalition suffering significant losses to right-wing opposition parties in the wake of a damaging sex scandal involving a former official. In Colombia, 77% of citizens cite corruption as their primary concern in recent polling, dwarfing worries about inflation and immigration.

What We’re Reading

Africa

Senegal’s prime minister was attacked but unharmed on the campaign trail (France 24) 

Financial audit forces Senegal to reassess IMF program strategy (AfricaNews)

Northern Nigeria is under major blackouts after grid sabotage (AFP) 

Guinea junta mass-dissolves dozens of political parties (AP)

Mozambique’s febrile political landscape won’t derail long-term growth prospects (FrontierView)

Spats over Russia and Ukraine expose cracks in South Africa’s unity government (AP)

South Africa cuts growth target as economic reality bites (FT)

France and Morocco announce high speed rail investments as Macron visits Rabat (AP)

Macron pledges French investment in Western Sahara under ‘Moroccan sovereignty’ (Le Monde)

Fintech startup Moniepoint becomes Africa’s latest unicorn (FT) 

Asia

Islamic finance rises in Pakistan (FT)

Pakistan hires external counsel as it prepares arbitration against Iran over pipeline dispute (Global Arbitration Review)

UK, EU and Canada announce new sanctions on Myanmar (UK FCDO)

Thailand, fresh off joining BRICS, seeks OECD accession (OECD)

Thailand and Indonesia lose ground to Côte d’Ivoire in rubber output (Nikkei)

Indonesia’s new president faces $186bn debt dilemma with state-owned enterprises (Bloomberg)

Middle East

Oman OQ shares plunge then recover as local investors take profit on IPO debut (AGBI)

Bank deposits in Oman rise nearly 12% in first 8 months of 2024 (Muscat Daily)

QatarEnergy takes 50% stake in TotalEnergies solar project in Iraq (Reuters)

Europe

Ukraine and Russia in Qatar-mediated talks over halting strikes on energy plants (FT)

Latin America

Dominican Republic’s 2025 budget shows broad investment but limited tax collection (FrontierView)

Panama Canal seeks LNG comeback after 65% decline in traffic (Reuters)

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