Download Central Europe and Russia Fund (CEE)

Central Europe and Russia Fund
(CEE)
Investor Recommendation:
Buy
Shares
900
Stop-loss
$42.00
Position size 3.5%
Risk to Fund 0.55%
Pricing:
(As of 3/30/07)
Closing Price $50.10
52-week high $59.90
52-week low $35.27
Market Data:
Shares
14,002,505
Avg. Volume 113,700
Market Cap. 701.5M
Beta
1.87
NAV
$772.7M
Dist. Rate
1.21%
Derek Schmidly
[email protected]
Central Europe and Russia Fund (CEE)
Fund Stated Objective
The Central Europe and Russia Fund Inc. is a non-diversified
closed-end investment company seeking capital appreciation
primarily through investment in Central European and Russian
equities. Its benchmark is comprised of 45% CECE (Central
Europe) 40% RTX (Russia) and 10% ISE National 30 (Turkey)
effective April 1 2004.1
Basic Information
The Fund's portfolio includes investments in Russian, Polish,
Hungarian, Czech Republic, Turkish, Austrian, Dutch, Cyprus,
Bermuda and Virgin Islands common stocks. The Fund invests in
various industries, including commercial banks, diversified
telecommunication services, food products, metals and mining,
personal products, wireless telecommunication services, building
products, diversified telecommunication services, media,
pharmaceuticals, automobiles, and oil, gas and consumable fuels.
The Fund is managed and advised by subsidiaries of the
Deutsche Bank Group. The Fund's investment advisor is
Deutsche Asset Management International GmbH. The Fund's
manager is Deutsche Investment Management Americas Inc.2
Selection Criteria
Due to the recommendations of the MIF committees, I thought it
would be good to give the fund more exposure to emerging
markets. For several years BRIC (Brazil, Russia, India, China)
have been the fastest growing emerging markets. After
examining all the opportunities and risks associated with these
countries, I decided that CEE would be the best fund at this time.
The following are the main reasons I did not choose the other
countries:
Brazil (EWZ): The economic data projects slower growth
comparatively
India (IFN; IIF): The funds do not follow the India Index close
enough
China (FXI): FXI is extremely overextended, 24% above the
300MA.
1
2
Etfconnect.com
Google.finance.com
1
Russia Overview (Since 56% of the ETF is allocated to Russia, my report will focus primarily on
the opportunities and risks in that country.)
The economic and business landscape in Russia has changed drastically over the last 15 years.
After the fall of communism, the economy changed to a free-market society, which is still
developing. Economic risk in Russia is relatively low compared to the primary risk, which is
political. The Russian economy has been performing well for several years – recovering from the
ruble devaluation of 1998 – and it should continue to perform well for several years to come.
Overall, inflationary pressures have been very high. Each year chronologically from 20022006 inflation was 15.8%, 13.6%, 10.9%, 12.5%, and 9.7%. Forecasters expect these numbers to
slowly decline in the coming years – 8.9% in 2007, and 8.7% in 2008, and 8.4% in 2009 (See
Appendix).3 In developed countries, inflation levels this high would be very damaging to the
economy, but the Russian economy has been growing so quickly that living standards have remained
relatively stable. Even with such a loss in purchasing power, private consumption has been robust.
Data suggests that living standards are poor, but the actual living standards have held up much better
than the official data suggests. This discrepancy is due to underreporting of wages in Russia. In
other words, corruption, and specifically tax evasion, is a serious problem in Russia, and it is making
some statistics less reliable.4
Unemployment has decreased sharply from an average of 14.2% in 1998 to 7% this year and
is expected to decline to about 6.5% within the next five years.
GDP is expected to continue to grow at a strong rate. In 2003 and 2004, GDP growth rates
were more than 7%, and this year it is expected to finish at 6.8%. It is expected to continue to grow
at a strong pace above 5.5% each year for the next 3 years.
According to Business Monitor International (BMI), the short term economic rating for
Russia is great, designated at 81.0 which is well above the emerging market average of 60.3. The
long term BMI economic rating for Russia is also strong.5
“Russia: Macroeconomic Data and Forecasts,” Russia Business Forecast Report; 2007, p. 2.
“The Economy: Regional Trends,” Counrty Profile: Russia; 2005, p. 46.
5 “Chapter 2: Economic Outlook,” Russia Business Forecast Report; 2007 Q1, p 11.
3
4
2
Recently, much of the economic growth in Russia has been the result of high oil prices.
Russia is rich in natural resources; thus, its oil supply has brought windfall profits into the country.
The government has been saving much of the money, but it has also used some of it to pay down the
huge debts from the former USSR. As a result, Russia’s credit rating has improved, and slowly it has
earned investment grade from every major investment agency, with S&P being the final agency to
upgrade them (Jan 2005). Exports have also been consistently higher than imports, giving Russia an
incredible balance of trade. This aspect has helped reduce its deficit. From 2003-2008 past data and
forecasts give the following trade balances (in billion $): 59.9; 85.8; 118.3; 139.6; 134.0; 120.2.
The ruble to dollar exchange rate is expected to fluctuate between 27 and just below 26 in
years to come. Overall, the economy has been and looks very promising; however, there are many
threats to prospect investors.
Risks
The biggest problem for businesses thinking about operating in Russia is corruption. Tax
evasion is a bad problem both for individuals and companies. Bribes are the norm in Russian culture,
paid to get out of speeding tickets, to avoid the government’s corporate regulations, and even to
receive favor in judicial proceedings. Last year, the average Russian company paid $135,000 in
bribes every year. Five years ago, the average was only $23,000. These bribes are primarily used to
pay off inspectors in order to keep them from reporting problems to the government. 6 Furthermore,
Russia has one of the largest markets for counterfeit products in the world, second only to China. It
is especially problematic in the pharmaceutical industry in which 60% of drugs sold in Russia are
counterfeit.7 These facts reflect a deficiency in Russian law and enforcement.
The second biggest threat is the vulnerability of the Russian economy to oil prices. The
market for commodities has been driving the Russian economy and many other resource-rich
economies around the world. Though this aspect has been one of Russia’s greatest strengths, it also
Renee Montagne, “Analysis: Corruption on the Rise in Russia,” Morning Edition NPR (11 Nov 2005).
http://search.epnet.com/login.aspx?direct=true&db=nfh&an=6XN200511251102.
7 “Chapter 4: Key Economic Sectors,” Russia Business Forecast Report, 2006, p. 32.
6
3
makes its economy vulnerable. The forecasts presented by economic analysts for Russia are all based
on the assumption that oil prices will stay near their current levels.8 However, if oil prices do fall, the
actual economic data will be substantially lower than the current forecasts.
The ways the Russian government has been spending its surplus profits from oil is the third
largest threat. Instead of using the excess to boost legislation and enforcement (which would reduce
corruption and attract foreign investments), the government has been spending the oil wealth on
wages, pensions, and other recurrent expenditures.9 Because of Russia’s high level of corruption, the
government has had difficulty gaining membership in the World Trade Organization (WTO),
although recent news is saying that it should be able to join by the end of the year.10 Reducing
corruption to tolerable levels, thereby attracting new investments, would also make its economy less
vulnerable to oil prices. Currently, Russia’s economic situation presents an opportunity for foreign
companies to capture huge market share, growth, and diversification; thus, with less corruption, DFI
would drive growth across all sectors instead of commodities alone.
Another risk to consider is that this is an election year for Russia, and the country is waiting to
see who will replace President Putin.
Strengths and Opportunities
Despite some threats, Russia presents some great opportunities. The best one is Russia’s tax
system. In 2001, the government passed a tax overhaul introducing a new flat tax system. The
previous system imposed a top rate of 30% on taxable income exceeding $5000; the new system
presents a 13% flat-rate on personal income.11 A tax this low seemed radical to many in the US, but
just one year after the new system was implemented, real ruble revenues increased 28%, and after
two years, a total of 50%. Those who support supply-side economics say this happened because
“people are willing to produce more and pay their taxes when the system is fair and tax rates are
low.”12 Corporate taxes were also lowered from 35% to 24%, and small businesses are now given the
choice of either a 6% tax on gross revenue or a 15% tax on profits.
Because of rising incomes, a middle class is emerging in Russia. 13 This fact presents
opportunity for retailers to introduce household convenience items. However, in order to achieve
growth, businesses must be able to persuade Russians about the “need” for convenience. Unlike
American culture, there are still many stay-at-home moms in Russia and also grandparents who live
in the home. Because of this, there has not been a high demand in the past for convenience items,
which are big sellers in the US. If retailers are successful in marketing, then the growth potential in
retail markets are high.
Another opportunity is the government’s use of oil revenues to safeguard the future and
improve the country’s infrastructure. Recently, oil revenues have been used to help construct roads,
start regional housing projects, and pay the military’s fuel bills. The government has also established
an Oil Stabilization Fund (OSF), which essentially is a savings account for excess profits that
safeguards the economy against the risk of a sharp fall in the oil prices. In October 2006, the OSF
stood at $71 billion.14
“Chapter 2: Economic Outlook,” 10.
“Russia – Concluding Statement of the 2005 IMF Mission,” International Monetary Fund (6 June 2005).
http://www.imf.org/external/np/ms/2005/060605.htm.
8
9
10
http://www.themoscowtimes.com/stories/2007/03/30/046.html
Alvin Rabushka, “The Flat Tax at Work in Russia,” (21 February 2002). http://www.russianeconomy.org/comments/022102.html.
12 Daniel J. Mitchell, “Russia’s Flat-Tax Miracle,” The Heritage Foundation (24 March 2003).
http://www.heritage.org/Press/Commentary/ed032403.cfm.
13 “Chapter 3: Business Environment,” 21.
14 “Russia diversification talk hurts dollar, boosts yen,”
http://www.marketwatch.com/News/Story/Story.aspx?dist=newsfinder&siteid=mktw&guid=%7B5ED60E5B-920E-4D11-A5A2AA5995D7EE25%7D
11
4
Russia and Eastern Europe vs. Other Emerging Market Investments
India: There are several reasons I chose CEE over India. The first is that there is not as much
macroeconomic data readily available to compare with the other countries. But the primary reason is
that none of the India funds track the BSE 30 (India Index) closely enough. Looking at the chart
below you’ll see the three India funds available to choose from and how they compare to the index.
IIF and IFN do not follow it closely enough, and although INP does seem to track it, the fund has too
little history to judge for sure. It was just launched late last year.15
Another reason I favor Russia over India is due to the Sector allocation of each fund. IFN
favors technology and finance; IIF favors Industrials and Financials; whereas CEE is heavily
weighted in Energy. As I’ll demonstrate later, CEE performs exceptionally well when oil prices rise,
and as the summer months approach, I believe the allocation of CEE will see much greater price
appreciation than the allocation of the India funds.
IFN
15
IIF
CEE
Comparing India Funds: INP is Clearly the Best Option,” http://india.seekingalpha.com/article/30466
5
Brazil: Brazil was a close second choice to Russia. Brazil also looks very favorable because its
allocation, which has the heaviest weight in Metals, Mining, and Oil, would be in line with the
recommendations of the economic committee. However, compared to Russia, Brazil has about half
as much growth in GDP and half as much inflation (See Appendix). Looking at the data, it seems to
be a country that is approaching more stable growth compared to the other BRIC countries which still
have many years of rapid growth. Brazil has also has had a significant increase in its perceived level
of corruption in the last year (See Appendix).
Brazil (EWZ)
China: China clearly has the fastest growing economic trends due to real GDP growth at 10.7% and
an inflation rate at 1.4%. However, the Chinese fund (FXI) is very extended right now and suffered
about a month ago from a 9% single day decline, which will take some time to recover from. For that
reason, I think it would be good for the class to look into an investment in China sometime later this
year, but now is not the time to buy because the risk is too great. The current price is a whopping
24% above the 300MA, and will likely be running into strong resistance at $105.
6
Central Europe/Russia
Unlike China, the time is right for this area of the world. Take a look at the chart below. The
green line is the price of oil. Clearly, whenever oil prices increase or decrease, the price of CEE
moves strongly also. However, if you notice the most recent run up in oil starting in the beginning of
2007, the price of CEE has not responded. I believe this is only a delay. Based on its history and
heavy allocation in Energy, an increase in oil prices should lead to price appreciation. The increase
has probably been delayed because other emerging markets were overextended at the end of last year,
and investors have been avoiding emerging markets since the beginning of the year. So, they have
probably lumped CEE in along with the other emerging markets and have overlooked it. So, based
on its correlation to oil prices, and the projection that oil prices will rise as we head into the summer,
I think now is an opportune time to purchase shares in this fund.
Stockcharts.com
Another reason I favor long term investment in Russia is due to its huge amount of land and natural
resources. As more countries are becoming industrialized the demand for natural resources should
continue to increase. So, as long as there is growth somewhere in the world, chances are, those
countries will be looking to Russia for the natural resources needed to drive that growth. Also,
because there is still so much undeveloped land in Russia, there are opportunities for exploration and
discovery of new resources. On the other hand, most other countries are running out of land that has
not yet been explored.
Central Europe and Russia Fund (CEE) vs Templeton Russia Fund (TRF)
Because the corruption levels in Russia are so high (See Appendix for corruption rankings by
nation) and because the country’s leadership can be unpredictable at times, I decided that CEE would
have less risk than TRF because of its exposure to other Eastern European nations like Poland,
Turkey, Austria, and Hungary, which have much lower rating on corruption. I also think that CEE’s
very heavy weight in Energy makes it more attractive than the current allocation of TRF, which has
its largest allocation in Telecom. The projections for growth in the Eastern European countries are
good, but not as strong as the projections for Russia (See Appendix). However, I believe the
reduction in political risk and better diversification are worth giving up some allocation to Russia.
7
Russia (TRF)
Russia (TRF)
CEE
CEE
Another downside to TRF is that its management fee is almost twice as much as CEE’s management
fee: 1.91% verses 1.09%.
CEE Largest Holdings
Gazprom
Lukoil
Unified Energy
JSC MMC Norilsk Nickel
Surgutneftegaz
Erste Bank
Ceske Energeticke
Telekomunikacja Polska
Bank Polski
Polski Koncern Naftowy
Etfconnect.com
12.1%
8.7%
6.5%
5.6%
4.8%
4%
3.9%
3%
3%
2.9%
8
Key Stats & Ratios: Gazprom
Quarterly
(Sep '06)
Annual
(2005)
Annual
(TTM)
Net Profit Margin
26.13%
22.84%
26.29%
Operating Margin
33.36%
32.81%
34.30%
EBITD Margin
-
41.83%
41.98%
Return on Average Assets
10.87%
8.37%
12.63%
Return on Average Equity
Finance.google
16.52%
13.33%
19.04%
Quarterly
(Sep '06)
Annual
(2005)
Annual
(TTM)
Net Profit Margin
13.51%
11.68%
12.13%
Operating Margin
18.21%
16.70%
16.78%
EBITD Margin
-
19.04%
19.31%
Return on Average Assets
21.57%
18.73%
19.63%
Return on Average Equity
Finance.google
31.67%
27.06%
28.52%
Key Stats & Ratios: Lukoil
Valuation
Unfortunately, there is not enough data available to calculate a meaningful valuation. This is
the case for most international ETFs, which is why there has been so much information in the other
sections.
Beta was calculated using a regression of 3 year monthly returns against the S&P 500
SUMMARY OUTPUT
Regression Statistics
Multiple R
0.43906897
R Square
Adjusted R
Square
0.19278156
Standard Error
0.07761335
0.16903984
Observations
36
ANOVA
df
Regression
Significance
F
SS
MS
F
8.11995
0.007384
1
0.048913217
0.0489
Residual
34
0.204810311
0.006
Total
35
Coefficients
0.253723528
Standard
Error
t Stat
P-value
Lower 95%
-0.0833
0.0136
6.1156
0.0000
-0.1110
-0.0556
-0.1110
-0.0556
1.8738
0.6576
2.8496
0.0074
0.5374
3.2101
0.5374
3.2101
Intercept
0.0033
Upper
95%
Lower
95.0%
Upper
95.0%
9
Recent News16



Central Europe and Russia Fund Inc. Announces Distribution
2006 Dec 11 | 11:14 PM
The Central Europe and Russia Fund, Inc. announced that its Board of Directors declared a
distribution of $0.584 per share payable from net investment income, $1.94 per share payable
from short-term capital gains and $2.992 per share payable in long-term capital gains for a
total distribution of $5.516 payable in stock with an option to receive cash. The record date is
December 21, 2006, and the payable date will be December 28, 2006. The shares will trade
'ex-dividend' on December 19, 2006.
Summary
Positive Aspects
Flat Tax is good for business
Resource rich country
Benefits from high oil/gas prices
The timing seems good
Growing middle class
The government is saving money (OSF) and paying off debt
Huge trade surplus
Growth forecasts are well above average compared to other emerging markets
Financial strength of largest holdings
Negative Aspects
High corruption in Russia
High inflation
Presidential changes
Management fee of 1.09%
Based upon this report, I think an investment in Central Europe and Russia is the best
investment opportunity in emerging markets right now. I am recommending a holding of 3.5%
in CEE and also that we sell 3.5% of our position in EFA to keep our international allocation
balanced.
16
Reuters.com
10
11
12
13
India
“Political Outlook,” Asia Monitor: South Asia Monitor of Business Monitor International, p 3.
14
Corruption Index 2006
CountryCountry
Rank
1
1
1
4
5
Finland
Iceland
New Zealand
Denmark
Singapore
2006 SurveysConfidence
CPI
used
range
Score
9.6
7
9.4 - 9.7
37
Cyprus
5.6
4
5.2 - 5.9
39
Oman
5.4
3
4.1 - 6.2
40
Jordan
5.3
7
4.5 - 5.7
9.6
9.5 - 9.7
41
Hungary
5.2
8
5.0 - 5.4
9.4 - 9.6
42
Mauritius
5.1
5
4.1 - 6.3
9.4 - 9.6
42
South Korea
5.1
9
4.7 - 5.5
9.2 - 9.5
44
Malaysia
5.0
9
4.5 - 5.5
Italy
4.9
7
4.4 - 5.4
9.6
9.5
9.4
6
7
7
9
6
Sweden
9.2
7
9.0 - 9.3
45
7
Switzerland
9.1
7
8.9 - 9.2
46
4.8
8
4.4 - 5.2
8
Norway
8.8
7
8.4 - 9.1
Czech
Republic
9
Australia
8.7
8
8.3 - 9.0
46
Kuwait
4.8
5
4.0 - 5.4
9
Netherlands
8.7
7
8.3 - 9.0
46
Lithuania
4.8
6
4.2 - 5.6
11
Austria
8.6
7
8.2 - 8.9
49
Latvia
4.7
6
4.0 - 5.5
11
Luxembourg
8.6
6
8.1 - 9.0
49
Slovakia
4.7
8
4.3- 5.2
11
United
Kingdom
8.6
7
8.2 - 8.9
51
South Africa
4.6
8
4.1 - 5.1
51
Tunisia
4.6
5
3.9 - 5.6
8.0 - 8.9
53
Dominica
4.5
3
3.5 - 5.3
7.7 - 8.8
54
Greece
4.4
7
3.9 - 5.0
7.8 - 8.4
55
Costa Rica
4.1
5
3.3 - 4.8
7.0 - 8.1
55
Namibia
4.1
6
3.6 - 4.9
6.7 - 7.8
57
Bulgaria
4.0
7
3.4 - 4.8
El Salvador
4.0
5
3.2 - 4.8
14
15
16
17
18
Canada
Hong Kong
Germany
Japan
France
8.5
8.3
8.0
7.6
7.4
7
9
7
9
7
18
Ireland
7.4
7
6.7 - 7.9
57
20
Belgium
7.3
7
6.6 - 7.9
59
Colombia
3.9
7
3.5 - 4.7
20
Chile
7.3
7
6.6 - 7.6
60
Turkey
3.8
7
3.3 - 4.2
6.6 - 7.8
61
Jamaica
3.7
5
3.4 - 4.0
6.3 - 7.2
61
Poland
3.7
8
3.2 - 4.4
6.0 - 7.2
63
Lebanon
3.6
3
3.2 - 3.8
6.1 - 7.4
63
Seychelles
3.6
3
3.2 - 3.8
5.4 - 7.1
63
Thailand
3.6
9
3.2 - 3.9
5.9 - 7.3
66
Belize
3.5
3
2.3 - 4.0
5.4 - 7.3
66
Cuba
3.5
3
1.8 - 4.7
Grenada
3.5
3
2.3 - 4.1
20
23
24
24
26
26
28
USA
Spain
Barbados
Estonia
Macao
Portugal
Malta
7.3
6.8
6.7
6.7
6.6
6.6
6.4
8
7
4
8
3
7
4
28
Slovenia
6.4
8
5.7 - 7.0
66
28
Uruguay
6.4
5
5.9 - 7.0
69
Croatia
3.4
7
3.1 - 3.7
31
United Arab
Emirates
6.2
5
5.6 - 6.9
70
Brazil
3.3
7
3.1 - 3.6
70
China
3.3
9
3.0 - 3.6
32
Bhutan
6.0
3
4.1 - 7.3
70
Egypt
3.3
6
3.0 - 3.7
32
Qatar
6.0
5
5.6 - 6.5
70
Ghana
3.3
6
3.0 - 3.6
34
Israel
5.9
7
5.2 - 6.5
70
India
3.3
10
3.1 - 3.6
34
Taiwan
5.9
9
5.6 - 6.2
70
Mexico
3.3
7
3.1 - 3.4
36
Bahrain
5.7
5
5.3 - 6.2
70
Peru
3.3
5
2.8 - 3.8
37
Botswana
5.6
6
4.8 - 6.6
70
Saudi Arabia
3.3
3
2.2 - 3.7
15
70
Senegal
3.3
5
2.8 - 3.7
99
Mozambique
2.8
7
2.5 - 3.0
79
Burkina Faso
3.2
5
2.8 - 3.6
99
Ukraine
2.8
6
2.5 - 3.0
79
Lesotho
3.2
5
2.9 - 3.6
105 Bolivia
2.7
6
2.4 - 3.0
79
Moldova
3.2
7
2.7 - 3.8
105 Iran
2.7
3
2.3 - 3.1
79
Morocco
3.2
6
2.8 - 3.5
105 Libya
2.7
3
2.4 - 3.2
79
Trinidad and
Tobago
3.2
5
2.8 - 3.6
105 Macedonia
2.7
6
2.6 - 2.9
105 Malawi
2.7
7
2.5 - 3.0
84
Algeria
3.1
5
2.7 - 3.6
105 Uganda
2.7
7
2.4 - 3.0
84
Madagascar
3.1
5
2.3 - 3.7
111 Albania
2.6
5
2.4 - 2.7
84
Mauritania
3.1
4
2.1 - 3.7
111 Guatemala
2.6
5
2.3 - 3.0
84
Panama
3.1
5
2.8 - 3.3
111 Kazakhstan
2.6
6
2.3 - 2.8
84
Romania
3.1
8
3.0 - 3.2
111 Laos
2.6
4
2.0 - 3.1
84
Sri Lanka
3.1
6
2.7 - 3.5
111 Nicaragua
2.6
6
2.4 - 2.9
90
Gabon
3.0
4
2.4 - 3.3
111 Paraguay
2.6
5
2.2 - 3.3
90
Serbia
3.0
7
2.7 - 3.3
111 Timor-Leste
2.6
3
2.3 - 3.0
90
Suriname
3.0
4
2.7 - 3.3
111 Viet Nam
2.6
8
2.4 - 2.9
93
Argentina
2.9
7
2.7 - 3.2
111 Yemen
2.6
4
2.4 - 2.7
93
Armenia
2.9
6
2.7 - 3.0
111 Zambia
2.6
6
2.1 - 3.0
93
Bosnia and
Herzgegovina
2.9
6
2.7 - 3.1
121 Benin
2.5
6
2.1 - 2.9
93
Eritrea
2.9
3
2.2 - 3.5
121 Gambia
2.5
6
2.3 - 2.8
93
Syria
2.9
3
2.3 - 3.2
121 Guyana
2.5
5
2.2 - 2.6
93
Tanzania
2.9
7
2.7 - 3.1
121 Honduras
2.5
6
2.4 - 2.7
99
Dominican
Republic
2.8
5
2.4 - 3.2
121 Nepal
2.5
5
2.3 - 2.9
121 Phillipines
2.5
9
2.3 - 2.8
2.5 - 3.0
121 Russia
2.5
8
2.3 - 2.7
2.5
3
2.3 - 2.6
2.5
3
2.2 - 2.7
99
Georgia
2.8
6
99
Mali
2.8
7
2.5 - 3.3
121 Rwanda
99
Mongolia
2.8
5
2.3 - 3.4
121 Swaziland
Countries with a significant worsening in perceived levels of corruption include: Brazil, Cuba, Israel, Jordan, Laos, Seychelles, Trinidad and
Tobago, Tunisia and the United States. Countries with a significant improvement in perceived levels of corruption include: Algeria, Czech
Republic, India, Japan, Latvia, Lebanon, Mauritius, Paraguay, Slovenia, Turkey, Turkmenistan and Uruguay. 17
17
http://www.finfacts.com/corruption.htm
16
17
18
19
20
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