International Business : Global Markets and Economic Update
* The Bolsa index continues to rally. It went above its 1994 opening level of 2,502 on Wednesday, but it remains well below the year’s peak of 2,881.17 reached Feb. 8. Because of devaluation against the dollar, the index is about 9.5% lower in dollar terms since Jan 1. More investors are again betting on the success of reform.
* Political uncertainty has lessened since a poll found that Ernesto Zedillo, the presidential candidate of the Institutional Revolutionary Party (PRI), was preferred by 50% of the electorate. A PRI victory later this month would help secure reform and growth in corporate profits.
Source: Bloomberg Business News
Under pressure from international donors, Ghana instituted strict austerity measures in the late 1980s to restructure its economy, including removing most price and currency controls. The reform measures attracted additional foreign aid, which is responsible for Ghana’s healthy annual rate of growth during the 1990s.
Sources: Bank of America; World Information Services