1. Overview of risks in advanced and emerging countries
Grzegorz Sielewicz
CEE Chief Economist
Coface Country Risk Conference
Prague, 24th May 2017

2. Recovery in global growth
Coface world GDP growth forecast
Business confidence
( average = 100)

3. Are financial markets becoming tired of politIcal risk?
Political uncertainty & stock market volatility
Stock market volatility after a major political shock (VIX, 1-month average)
Greece: First bailout plan (Q2 2010)
Greece: 4th & 5th austerity packages (Q3 2011)
Greece: A. Tsipras sworn as PM (Jan. 2015)
UK referendum (June 2016)
US election (Nov. 2016)
Italy’s referendum
(Dec. 2016)
Global political uncertainly index (EPU)
VIX index (RHS)
Source: Coface
Sources: Reuters, Coface

4. US: will Trump manage to delay the end of the cycle?
US: Corporate profits, building permits and vehicle sales
Sources: Coface, BEA

5. UK: rising inflation impacts sectors in different ways
UK: Impact of a 15% depreciation of the GBP (% points, REER)
UK: Coface Sector Risk Assessments
Low risk
Medium risk
High risk
Very high risk
Low risk
Medium risk
High risk
Very high risk
Source: Coface
Source: Coface

6. Businesses: fewer insolvencies, but still little business creation
Business insolvencies: growth forecast (%)
Business creations
(% change between 2015 and the pre-crisis peak)
36,5%
Germany US
Italy
France (2016) UK
Sources: Coface forecast, national sources
Sources: National sources

7. Emerging markets: slight economic upturn in 2017
Emerging markets: 2017 Growth forecasts by sector
2017 Growth
forecast
Growth change in pp
Sources: Coface, Oxford Economics

8. Corporate debt and banking risk go hand in hand
Corporate debt to GDP ratio
(Change between Q et Q in pp)
Banking credit condition survey
(below 50 = tightening)
Sources: Coface, BIS
Sources: IIF, Coface

9. China: from one bubble to another
1. Stock market
(CSI 300 index)
2. Capital outflows
(USD bn / month)
3. Bond market
(5-year sovereign bond yield, %)
4. Real estate market
(average national price,
RMB/sqm)
5,500
5.0
5,000
4.5
4,500
4.0
4,000
3,500
3.5
3,000
3.0
2,500
2,000
2.5
1,500
2.0
2012
2013
2014
2015
2016
2012
2013
2014
2014
2016
2012
2013
2014
2015
2016
2006
2009
2012
2015
Sources: Bloomberg, CEIC, Coface

10. Country Risk Assessments

11. Country Risk Assessments: Advanced economies

12. Country Risk Assessments: Emerging economies (1)

13. Country Risk Assessments: Emerging economies (2)