Marcello Estevão · Jonathan Fortun / Institute of International Finance
Global growth in 2026 increasingly depends on a US expansion powered by productivity and investment in artificial intelligence. Yet stronger output does not translate proportionately into jobs. Capital intensity, semiconductor concentration and policy frictions reshape the expansion, while geopolitical risks operate through confidence and asset pricing. The result is growth with a weaker employment footprint.
Marcello Estevão · Jonathan Fortun / Institute of International Finance
Improved repayment capacity helps explain why emerging market sovereign spreads have narrowed even with elevated US yields. Stronger balance sheets and favorable rating changes point to declining credit risk rather than a rally driven solely by easier global rates. As returns from carry mature, the analysis anticipates a possible rotation of inflows toward issuance in foreign currencies.
Jonathan Fortun / Institute of International Finance
Emerging market portfolios ended December with $36.7 billion in inflows, reversing November’s $5.4 billion withdrawal. Bonds accounted for most of the recovery, attracting $29.4 billion, while equities received $7.3 billion. Asia and Latin America led the rebound, with debt providing the more dependable source of demand as equity investors remained selective.
Fortun distinguishes renewed investor appetite from durable stabilization, examining domestic debt, scarce liquid reserves and the risks of borrowing abroad before restoring fiscal credibility.
Jonathan M. Fortun Vargas / Fiscal policy for sustainable development in the Global South, LSE International Inequalities Institute and UNU-WIDER workshop
Accepted for presentation at the LSE International Inequalities Institute and UNU-WIDER workshop on 6 November 2026. Using BOLMOD, the Bolivian module of SOUTHMOD, this paper studies how Bolivia’s fuel subsidy reform and exchange rate unification affect households. It compares the enacted compensation package with alternatives deliverable through existing registries, showing why administrative visibility matters for who receives relief.
Fortun argues that Bolivia's fuel-subsidy reform needs a broader fiscal anchor and that implementing it during December's seasonal demand peak intensifies inflation and uncertainty.
Jonathan Fortun argues that removing Bolivia’s fuel subsidies was economically necessary but politically exposed. He examines how higher fuel prices can spread through transport, food costs, exchange rate expectations and household behavior. The essay assesses targeted income support, social conflict and political coordination as conditions for turning an emergency decree into a durable stabilization program.
Marcello Estevão · Jonathan Fortun / Institute of International Finance
The direction of the 2025 economic cycle proved more predictable than its timing. China’s repeated recovery trades faded, while emerging market resilience relied more on domestic foundations than expected. Europe and Japan moved through uneven stages, requiring reassessment. Low volatility and a relatively contained dollar range persisted despite geopolitical uncertainty, pointing to structural forces beneath the headlines.