China economic downturn deepens
For long life: A group of Chinese chefs show off the art of noodle making in Xian, northern China's Shaanxi province on Wednesday. The Chinese have been feasting on noodles for approximately 2,000 years, dating back to the Han dynasty (206 BC-220 AD). Picture: AFP
SINGAPORE
Friday, November 28, 2008
CHINA yesterday warned its economic downturn was deepening with the spread of the global financial crisis, while a senior European policymaker said woes could extend beyond 2009.
In India, emerging Asia's other economic titan, financial markets were closed after Islamist militants killed more than 100 people in the commercial capital Mumbai.
The violence in Mumbai and the political unrest in Thailand showed that political risk is an extra potential threat to emerging markets reeling from the global crisis.
"These awful events are reinforcing the nervousness about emerging markets, which have been weak any way for some time after the U.S. slowdown and the domino effect," said Justin Urquhart Stewart, investment director at Seven Investment Management in London.
The economic warnings from China's top planner came a day after its central bank cut interest rates by the biggest margin in 11 years in response to the worst global downturn in decades.
China's State Information Centre, a government think-tank, forecast annual growth would slow to eight per cent this quarter from nine per cent in the third quarter, a rapid cooling from double-digit rates recorded in the past five years.
"The global financial crisis has not bottomed out yet. The impact is spreading globally and deepening in China. Some domestic economic indicators point to an accelerated slowdown in November," Zhang Ping, chairman of the National Development and Reform Commission, told a news conference.
With factories closing by the thousands, Chinese officials have grown increasingly concerned in recent weeks that slowing growth may threaten the stability that the ruling Communist party craves for its 1.3 billion people.
Slowing demand for Chinese exports in the West is curbing growth and there is no relief in sight.
The eurozone is likely to be in recession next year, European Union Economic and Monetary Affairs Commissioner Joaquin Almunia said, reversing a forecast of slight growth made earlier this month.
Almunia would not give a specific forecast for 2009, but said next year may not mark the end of the eurozone's troubles. "The crisis may not end in 2009," he said.
Emphasising the bleak outlook, the eurozone's business climate indicator fell to its lowest in more than 15 years in November, European Commission data showed.
Reuters
Showing posts with label global. Show all posts
Showing posts with label global. Show all posts
Friday, November 28, 2008
US$5 trillion lost in global financial crisis
US$5 trillion lost in global financial crisis
PARIS
Friday, November 28, 2008
A TOTAL of US$5 trillion has been lost in the global financial crisis, the head of the Davos economic forum said yesterday as he announced a record presence of world leaders at the conference in January.
Russian Prime Minister Vladimir Putin will give the opening speech at the World Economic Forum in the Swiss resort on January 28 where the theme will be "Shaping The Post Crisis World", said its founder Klaus Schwab.
The Swiss economist, on a visit to Paris, said: "As it stands now, about US$5 trillion has been lost in the financial crisis and now has to be reconstituted" by governments. The forum had forecast the crisis in the financial system in its annual risk report at the start of the year.
"I am not dramatically pessimistic about the future, just realistically pessimistic and I think there are also enormous opportunities in terms of using technology and changing the environment," Schwab said.
He said the turmoil, the worst financial crisis since the Great Depression, meant that the 39th annual Davos meeting would be the most important ever and it will have the biggest participation.
Schwab said there would be more than 160 leaders of head of state or government or ministerial rank among the 1,200 business, social and trade union leaders at the five-day forum.
Putin was the only world leader whose presence was confirmed, but forum officials said many leaders from the Group of Eight industrial powers and emerging economic powers were expected to attend. The full list will only be released in January.
The violence in India and political unrest in Thailand highlighted political risk as an extra potential threat to emerging markets battered by the global crisis.
A crisis that began last year with the collapse of the US housing market has spread around the world, bringing several financial institutions to their knees and pushing the US, Japan and Europe into recession or to the brink of it.
Central banks around the globe have slashed interest rates to try to ease the flow of credit and restart stalled economies.
Economic sentiment in Europe's single currency zone slumped to 15-year lows in November and inflation expectations plunged, boosting the case for a big rate cut by the European Central Bank (ECB) next week.
"The eurozone is in a deep recession, upping the pressure on the ECB to cut interest rates further," said Christoph Weil, economist at Commerzbank. "We envisage a first move next week on a scale of 75 basis points to 2.5 per cent."
Benchmark rates stand at 3.25 per cent in the eurozone, compared with one per cent in the US.
Amid the crisis, job cuts are also increasing across the globe. Steelmaker ArcelorMittal said it would slash up to 9,000 positions. AFP, Reuters
PARIS
Friday, November 28, 2008
A TOTAL of US$5 trillion has been lost in the global financial crisis, the head of the Davos economic forum said yesterday as he announced a record presence of world leaders at the conference in January.
Russian Prime Minister Vladimir Putin will give the opening speech at the World Economic Forum in the Swiss resort on January 28 where the theme will be "Shaping The Post Crisis World", said its founder Klaus Schwab.
The Swiss economist, on a visit to Paris, said: "As it stands now, about US$5 trillion has been lost in the financial crisis and now has to be reconstituted" by governments. The forum had forecast the crisis in the financial system in its annual risk report at the start of the year.
"I am not dramatically pessimistic about the future, just realistically pessimistic and I think there are also enormous opportunities in terms of using technology and changing the environment," Schwab said.
He said the turmoil, the worst financial crisis since the Great Depression, meant that the 39th annual Davos meeting would be the most important ever and it will have the biggest participation.
Schwab said there would be more than 160 leaders of head of state or government or ministerial rank among the 1,200 business, social and trade union leaders at the five-day forum.
Putin was the only world leader whose presence was confirmed, but forum officials said many leaders from the Group of Eight industrial powers and emerging economic powers were expected to attend. The full list will only be released in January.
The violence in India and political unrest in Thailand highlighted political risk as an extra potential threat to emerging markets battered by the global crisis.
A crisis that began last year with the collapse of the US housing market has spread around the world, bringing several financial institutions to their knees and pushing the US, Japan and Europe into recession or to the brink of it.
Central banks around the globe have slashed interest rates to try to ease the flow of credit and restart stalled economies.
Economic sentiment in Europe's single currency zone slumped to 15-year lows in November and inflation expectations plunged, boosting the case for a big rate cut by the European Central Bank (ECB) next week.
"The eurozone is in a deep recession, upping the pressure on the ECB to cut interest rates further," said Christoph Weil, economist at Commerzbank. "We envisage a first move next week on a scale of 75 basis points to 2.5 per cent."
Benchmark rates stand at 3.25 per cent in the eurozone, compared with one per cent in the US.
Amid the crisis, job cuts are also increasing across the globe. Steelmaker ArcelorMittal said it would slash up to 9,000 positions. AFP, Reuters
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