The Recycler Issue 316

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CITY NEWS
ASIA
China, GDP, Slow Down
2019 to bring Chinese slowdown
A new report on the nation’s growth outlook has cast its predictions for the
Chinese economy.
Writing for Business Day, Dan Steinbock
argues that in the coming year, the Chinese
economy will be required to “cope with great
international uncertainty and even more
extraordinary market volatility.”
Looking at annualised growth over the
course of 2018, Steinbock calls last year an
“exceptional” one, with the fallout from the
trade war with the USA in the second half of
the year leading to “substantial collateral
damage that will be felt even more in 2019, in
the absence of a constructive reconciliation.”
However, forecasts for growth remain
around the 6.5/6.6 percent mark, and Chinese
GDP could grow by around 6.2 percent across
the Full Year – “assuming policymakers
succeed in the challenging balancing act
to sustain higher-quality growth while
suppressing faster debt accumulation.”
Despite this, Steinbock also asserts that the
Chinese government’s own GDP growth
target, which may not be officially announced
until March, will likely reflect a steady
deceleration, again owing to the trade war, and
other “more secular” pressures, including
environmental, debt, and real estate market
issues. This deceleration is referred to as
expected, following China’s recent history of
speedy industrialisation and growth.
Steinbock also admits that China “could
achieve more rapid growth,” but this would
come at the cost of ignoring its commitments
to higher living standards, sustainability, and
eradicating poverty. Despite the expected
deceleration, living standards in the country
should rise. The slowdown will also foster
stability, it is opined, compared to a more
abrupt decline.
In the long-term, the growth rate is
currently set to fall from 9.6 percent, as it was
in 2008, to 5.6 percent by 2023. Yet in that
period, GDP per capita will increase to more
than $21,200 (€18,549) from less than $7,900
(€6,912) in 2008.
Steinbock finishes his summary by warning
that the world’s major advanced economies
are “heading toward a complicated,
economically challenging and politically
divisive stagnation. Unfortunately, much of
these downside risks remain under-valued in
the West. The greater the gap between
misguided perceptions and economic realities,
the more challenging will be the awakening.”
EMEA Kotak Investment Advisors, Karvy Data Management Services
Kotak and Karvy bid for
Ricoh India
Kotak Investment Advisors and Karvy Data Management Services have
submitted bids to acquire Ricoh’s troubled Indian subsidiary.
As the Economic Times reports, the
“distressed” Ricoh India has almost
Rs 3000 crore ($421.7 million/€369.7
million) in unpaid dues and owes
Ricoh Japan and Ricoh Asia Pacific
approximately Rs 1,500 crore ($210.8
million/€184.8 million).
Kotak and Karvy submitted their bids to
Ricoh’s committee of creditors, helmed by
Deutsche Bank, “which will choose the
new owner of the company.” Ricoh India’s
lenders may suffer a 5-10 percent loss on
their loans. These include Bank of India
and Citibank.
Ricoh India’s troubles began in 2016,
when the company “admitted its accounts
appeared to have been ‘falsified’ and that it
estimated to have incurred a loss of Rs
1,123 crore ($157.8 million/€138.4 million)
for the financial year concluding March
2016.
Minority shareholders claimed
compensation both from Ricoh India and
its Japanese parent company.
THE RECYCLER • ISSUE 316 • MARCH 2019
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