Nigeria fiscal surplus deteriorates, “Made in China” brand gets revamp, Vietnam trade deficit doubles, Brazil just inches away from investment grade, Dubai property market suffers on US subprime woes
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Nigeria fiscal surplus deteriorates, “Made in China” brand gets revamp, Vietnam trade deficit doubles, Brazil just inches away from investment grade, Dubai property market suffers on US subprime woes

Nigeria’s finance minister Shamsudeen Usman admitted that the new government has not been saving money into the excess crude account (ECA) - a vehicle in which oil revenues gained over the $40 per barrel reference price are deposited. The finance ministry also announced a 15% public sector pay rise, as part of a settlement with labour unions following a strike in June. Analysts say these measures, combined with lower oil production this year and higher government spending, will erode the fiscal surplus for 2007 to around 3%-4% compared to 8%-12% seen in previous years. (For an exclusive interview with Nigeria’s president pledging wholesale economic reforms, please click here)

China has launched a four-month campaign to crack down on unsafe food and low quality products, in an attempt to protect the “Made in China” image after recent product recalls. The new measures require all food-processing companies to obtain licenses and require all restaurants to record the sources of their raw materials. The campaign compels electronic and toy producers to set up product quality controls throughout the entire production chain. Beijing has been put under the international spotlight after a series of quality problems affecting pet food, faulty tires and sub-standard toys. But experts do not expect that the recent product recalls will hamper China’s exports significantly. (For more on China’s export performance, click here)

Vietnam’s trade deficit doubled in August on the back of declining oil exports and surging imports of machinery. The trade gap widened to $6.41 billion through the first eight months of 2007 from $2.8 billion in the same period a year ago. Exports rose 19% to $31.22 billion, while imports climbed 30% to $37.63 billion. (For coverage on Vietnam’s surging equity market, please click here)

Brazil’s credit rating was raised to within one level of investment grade by Moody's to reflect the strong improvement in the government’s overall debt profile and large international reserves. The agency lifted the country’s foreign currency bond ratings to Ba1 from Ba2, which brings them into line with the other two main agencies, Standard & Poor's and Fitch.  Brazil's foreign reserves have soared to a record high of $160 billion on the back of surging exports and foreign investment into the local stock and bond markets. The government brought back more than $10 billion of foreign debt in 2006, using these dollar streams. (For more on the increasing stability of financial markets in Brazil, please click here)

Analysts say Emaar Properties, the largest real estate company in Dubai, will see a 15% decline in earnings due to its exposure to the troubled US property market through its subsidiary, John Laing Homes. But its long-term potential is likely to be offset by earnings from large tourism development projects in Libya. (For more coverage on the booming Gulf property market, please click here)

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