However, the Chinese government has sub- stantial financial resources to complete the necessary reforms. The adoption of a more ambitious fiscal policy in 2016 meant that Chi- nese economic growth remained on track at around 6.5%, avoiding a hard landing. Although the Chinese currency stabilised in the second half of the year, fears of a weaker yuan persist due to heavy capital outflows, which continued throughout the year.

Brazil and Russia, the two big countries to have experienced serious economic difficulties in 2015, with a contraction of the economy, saw their situation improve, in particular through an oil and commodity price rally. However, the economic and political situation in Brazil remains complicated, and the economy again shrank considerably in 2016 (-3.5%) according to IMF forecasts.


One of the key events of 2016 was the rebound in oil and industrial commodity prices (generally sensitive to the global business cycle) from a January low.

Oil prices had fallen from USD 115 a barrel on 19 June 2014 to USD 28 on 20 January 2016, a 75% reduction in the space of 19 months. The oil glut, resulting from US shale oil and high output in OPEC countries, was largely responsible for this fall.

Starting on 20 January 2016, oil prices more than doubled to end the year at nearly USD 57.

This increase stemmed from a rebalancing of supply and demand on the physical market, first due to temporary production stops, especially in Canada and Nigeria, and to lower production from tar sands, and then to the ratification of an agreement on 30 November to reduce output from OPEC countries, as well as other non-member countries such as Russia.

This rebalancing between supply and demand, which happened earlier than expected, also resulted from the continued rise in oil demand, especially in Asia, largely because the international economy did not collapse.

Oil price in dollars (per barrel)

Brent North Sea reference









2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Source: Bloomberg.