- WB chief Paul Wolfowitz’s future remains in doubt amid continuing controversy over his involvement in the promotion and pay rise of his partner. Over the weekend, Wolfowitz remained defiant: "I believe in the mission of this organization and I believe that I can carry it out," he said. The board of the WB are reviewing the case. However, some European governments have been vocal in their criticism, but the US have declared its backing.
- President Correa secured a clear victory in the referendum held yesterday to approve an assembly to rewrite the constitution. The “Yes” vote totalled 78.1%, while 11.5% voted “No”. Blank and invalid votes amounted to 10.4%. This paves the way for an election to select 130 members in the Constituent Assembly to convene for 6 months most likely in September. Correa’s win was expected but opponents fear that this is an attempt to centralize power. Correa also announced IMF debts were now fully paid and that dollarisation would remain during his tenure.
- The political heat in Turkey was raised by a speech by the outgoing President Sezer who attacked the “erosion of the republic’s secularism”. Sezer in a further nationalist message called for an end to the privatization of strategic companies. With the presidential elections looming, analysts expect the handover to be far from smooth, which could affect investor sentiment.
- Ukraine’s PM Yanukovich announced GDP growth most likely reached 8.6% yoy in March, higher than the 7.9% yoy expansion recorded in February. He projected overall growth in Q1-07 was 8.6% yoy and forecast this year’s growth to be 6.5%. But analysts are more cautious and predict that the benign external environment, including metal prices are unlikely to last and political instability is likely to be a drag on investment growth. WB/IMF confirm this caution having downgraded growth forecasts to 5-5.5% GDP.
- Information provided by Euromoney group sources