The Financial Times chief economics commentator Martin Wolf thinks that very few emerging markets are seen as financially stable among international investors. Mr. Wolf took part in a webinar this afternoon alongside Brazilian economists, including former Finance Minister Pedro Malan and former Central Bank Chairman Ilan Goldfajn.
“There are very few emerging economies which are perceived as completely unambiguously stable. Not about politics, in economic policy terms. There are a few exceptions,” said Mr. Wolf, without mentioning which countries fit the bill.
According to him, investors are looking for opportunities in emerging markets but want to avoid being “exposed in one country.”
“They want to diversify risks and want to be reasonably liquid, be able to run if possible. It is not committed long-term,” he said, emphasizing he was talking about bonds and equity markets.
In the mid-term, he says, Brazil has the significant advantage of not needing to take a side in the dispute between the U.S. and China. The neutral position seems “quite obvious” to Mr. Wolf. He did not touch on the many diplomatic issues created by Jair Bolsonaro’s administration in recent months. Nevertheless, like their neighbors in South America, the country still has to find a way to deal with the coronavirus. “The way the crisis is being handled will affect very much how people will perceive the continent subsequently.”Support this coverage →