BUENOS AIRES – At the recent Summit of the Americas in Panama, Cuban President Raúl Castro chose to break with the agreed protocol. Instead of speaking for eight minutes, he took six times longer to present a political history of his country that was only loosely based on fact. Why?
CAMBRIDGE – Something is definitely rotten in the state of capitalism. Despite unprecedentedly low interest rates, investment in most advanced countries is significantly below where it was in the years prior to the 2008 crisis, while employment rates remain stubbornly low. And even investment in the pre-crisis period was unimpressive, given low prevailing interest rates.
The world economy will receive a significant boost from lower oil prices this year despite fears of deflation and persistently weak spending, leading economists attending the World Economic Forum told the Financial Times.
Growth Lab's Albania research project in Harvard Gazette
Leading a nation long considered a model of economic dysfunction, Prime Minister Edi Rama of Albania has pushed for change since his election last year. And the change needed in his country is not the electioneering “change” promised by virtually everyone in U.S. politics, but sweeping reforms that remodel institutions and foster the economic revival taking hold oh-so-slowly in the former communist nation.
“We have … the youngest government in the history of Albania,” Rama said during a recent visit...
CAMBRIDGE – Will Venezuela default on its foreign bonds? Markets fear that it might. That is why Venezuelan bonds pay over 11 percentage points more than US Treasuries, which is 12 times more than Mexico, four times more than Nigeria, and double what Bolivia pays. Last May, when Venezuela made a $5 billion private placement of ten-year bonds with a 6% coupon, it effectively had to give a 40% discount, leaving it with barely $3 billion. The extra $2 billion that it will have to pay in ten years is the compensation that investors demand for the likelihood of default, in excess of the already hefty coupon.... Read more about Should Venezuela Default?
Colombia is currently one of the most dynamic economies in Latin America. In the first quarter of this year, growth was an impressive 6.4%, and for the full year will reach at least 5%. Abundant oil and mining revenues have been the main driver of the expansion. With a strong fiscal position and a monetary policy that enjoys credibility, the country has avoided squandering this boon. But it still has much...
WHICH WAY will Ukraine turn? With Russia’s recent military aggression taking so much of the spotlight, it’s easy to forget that Ukraine’s political unrest this year began with domestic protests over a question key to the future of its 45 million people: whether to tie their fortunes more closely to Russia, or to Western Europe.
As a former Soviet republic with many Russian speakers,...