US-based outsourcing firm Accenture is laying off almost half its workforce in the Philippine capital due to the effects of the global financial crisis, the Labour Department said.
Accenture Philippines has filed a notice of retrenchment for about 500 workers at its facilities in Manila, said Labour Undersecretary Rosalinda Baldoz.
Accenture, which engages in business process outsourcing, including call centres, had about a thousand workers in Manila and in March 2008 it opened an office in the central city of Cebu which employs about 500 people.
Call centres and other outsourced business processes have become a major industry in the Philippines. Industry leaders had previously predicted that the sector would not be affected by the global financial turmoil as companies in developed countries would outsource more of their functions abroad to save money during the crisis.
Agencies
Showing posts with label global financial crisis. Show all posts
Showing posts with label global financial crisis. Show all posts
Tuesday, March 3, 2009
Tuesday, February 17, 2009
Has the crisis left Dubai migrant workers out in the cold?
Low-paid Asian workers who toil long days to build the skyscrapers of Dubai have become the latest victims of the global financial crisis as companies run short of business and money.
For many years, the Gulf emirate was a magnet for South Asian workers who fed the booming economy with cheap manpower -- from cleaners and gardeners to skilled and unskilled builders.
A report issued earlier this month showed that 582 billion dollars worth of building projects in the United Arab Emirates, of which Dubai is a part, had been put on hold due to the slowdown. That was 45 percent of the total.
Arnold, a 26-year-old Filipino machine operator, found a job in a small aluminium factory only two months after arriving in Dubai last summer. But in January, he and six others from the 15-strong workforce were laid off.
"I am staying in Dubai trying to find another job," he said, pointing out that his previous employer lost a great deal of business when many construction projects ground to a halt, cutting demand for aluminium products.
Six years of spectacular growth in the UAE construction sector, mainly in Dubai, absorbed hundreds of thousands of workers, mostly from South Asia. That had a knock-on effect, creating further opportunities for migrants.
But the financial crisis, mainly in construction and related industries, is reversing that trend, forcing foreign workers to go home.
"The crisis is worse in the Philippines. We have no future there. We are looking for part-time jobs here, anything," Arnold told AFP as he hung out with two friends who had also lost their jobs.
Christopher, a compatriot, said he has been in Dubai for around nine months working as a welder during the day and a barista in the evening.
He and his wife, who also works in a Dubai coffee shop, used to send 500 dirhams (136 dollars) a month home, where their two kids were left behind.
Migrant workers send billions of dollars home every year. One money transfer firm, UAE Exchange, said its volume last year was 12 billion dollars, most of it to India, Bangladesh and the Philippines.
Like Arnold, Christopher was working illegally in the hope that an employer would get him a work permit. Now he is searching desperately for anything.
But even for labourers who were brought to the UAE on a work visa to satisfy the needs of the once-booming economy, many are receiving the pink slip.
"Some 200 gardeners were sacked recently from our company" out of about 10,000 workers, said an Indian as he planted saplings in the garden of an elegant office building in Dubai.
"They told us the company does not have much work and is short of money," said the man in his mid-40s, refusing to give his name.
Two other colleagues, an Indian and a Bangladeshi, carried on trimming the hedge, appearing hesitant to say anything that might jeopardise their jobs.
"We are expecting to lose our jobs," said the man, who earns a meager 500 dirhams (136 dollars) a month in return for 48 hours a week.
He lamented that two years ago he had to pay what was for him a fortune of around 10,000 dirhams (2,725 dollars) to Indian intermediaries to get a job in Dubai.
Murukesan, an Indian cleaner, said his employer, a large cleaning and maintenance company, last week told workers who had completed at least two years of work to go home on four-month unpaid vacations.
"They said do not come back until we call you," he said with a faint smile, appearing content as he has completed only 18 months of his contract.
"In the past, workers were not taking vacations, even after four years of continuous work," he said, highlighting a huge work load in the immediate past.
It appears some of the unpaid "vacations" are simply a way of getting rid of people without having to pay them off. Under UAE law, workers laid off must be paid 21 days' salary for each of the first five years worked and a month's salary for every year after that.
"They are trying to find excuses to bypass the rules of terminating a contract," said Monir al-Zaman, labour attache at the Bangladeshi embassy.
"Compensation should be paid if workers are being fired," he told the media, adding that companies should resort to cutting overtime work and even reduce salaries before laying off workers.
In December, Khalfan al-Kaabi, a member of the Abu Dhabi Chamber of Commerce board of directors, said up to 45 percent of construction workers could be laid off this year if private sector projects in the UAE were delayed or cancelled.
Zaman said he could not provide a figure on Bangladeshi workers having lost their jobs in the UAE, because the process is not done "formally".
He also pointed out that he noticed, during inspection visits to labour camps, that many workers stayed in the UAE even if they were not being paid, in hope of finding work.
But poor unemployed workers cannot linger for long if jobs remain rare.
"Maybe this month I have to decide to stay or go ... because I don't have any money. Now I'm borrowing from friends," said Arnold.
Agencies
For many years, the Gulf emirate was a magnet for South Asian workers who fed the booming economy with cheap manpower -- from cleaners and gardeners to skilled and unskilled builders.
A report issued earlier this month showed that 582 billion dollars worth of building projects in the United Arab Emirates, of which Dubai is a part, had been put on hold due to the slowdown. That was 45 percent of the total.
Arnold, a 26-year-old Filipino machine operator, found a job in a small aluminium factory only two months after arriving in Dubai last summer. But in January, he and six others from the 15-strong workforce were laid off.
"I am staying in Dubai trying to find another job," he said, pointing out that his previous employer lost a great deal of business when many construction projects ground to a halt, cutting demand for aluminium products.
Six years of spectacular growth in the UAE construction sector, mainly in Dubai, absorbed hundreds of thousands of workers, mostly from South Asia. That had a knock-on effect, creating further opportunities for migrants.
But the financial crisis, mainly in construction and related industries, is reversing that trend, forcing foreign workers to go home.
"The crisis is worse in the Philippines. We have no future there. We are looking for part-time jobs here, anything," Arnold told AFP as he hung out with two friends who had also lost their jobs.
Christopher, a compatriot, said he has been in Dubai for around nine months working as a welder during the day and a barista in the evening.
He and his wife, who also works in a Dubai coffee shop, used to send 500 dirhams (136 dollars) a month home, where their two kids were left behind.
Migrant workers send billions of dollars home every year. One money transfer firm, UAE Exchange, said its volume last year was 12 billion dollars, most of it to India, Bangladesh and the Philippines.
Like Arnold, Christopher was working illegally in the hope that an employer would get him a work permit. Now he is searching desperately for anything.
But even for labourers who were brought to the UAE on a work visa to satisfy the needs of the once-booming economy, many are receiving the pink slip.
"Some 200 gardeners were sacked recently from our company" out of about 10,000 workers, said an Indian as he planted saplings in the garden of an elegant office building in Dubai.
"They told us the company does not have much work and is short of money," said the man in his mid-40s, refusing to give his name.
Two other colleagues, an Indian and a Bangladeshi, carried on trimming the hedge, appearing hesitant to say anything that might jeopardise their jobs.
"We are expecting to lose our jobs," said the man, who earns a meager 500 dirhams (136 dollars) a month in return for 48 hours a week.
He lamented that two years ago he had to pay what was for him a fortune of around 10,000 dirhams (2,725 dollars) to Indian intermediaries to get a job in Dubai.
Murukesan, an Indian cleaner, said his employer, a large cleaning and maintenance company, last week told workers who had completed at least two years of work to go home on four-month unpaid vacations.
"They said do not come back until we call you," he said with a faint smile, appearing content as he has completed only 18 months of his contract.
"In the past, workers were not taking vacations, even after four years of continuous work," he said, highlighting a huge work load in the immediate past.
It appears some of the unpaid "vacations" are simply a way of getting rid of people without having to pay them off. Under UAE law, workers laid off must be paid 21 days' salary for each of the first five years worked and a month's salary for every year after that.
"They are trying to find excuses to bypass the rules of terminating a contract," said Monir al-Zaman, labour attache at the Bangladeshi embassy.
"Compensation should be paid if workers are being fired," he told the media, adding that companies should resort to cutting overtime work and even reduce salaries before laying off workers.
In December, Khalfan al-Kaabi, a member of the Abu Dhabi Chamber of Commerce board of directors, said up to 45 percent of construction workers could be laid off this year if private sector projects in the UAE were delayed or cancelled.
Zaman said he could not provide a figure on Bangladeshi workers having lost their jobs in the UAE, because the process is not done "formally".
He also pointed out that he noticed, during inspection visits to labour camps, that many workers stayed in the UAE even if they were not being paid, in hope of finding work.
But poor unemployed workers cannot linger for long if jobs remain rare.
"Maybe this month I have to decide to stay or go ... because I don't have any money. Now I'm borrowing from friends," said Arnold.
Agencies
Monday, January 5, 2009
India to emerge strong from the global meltdown
The report said India, along with China, Russia and South Korea would emerge stronger from the global financial crisis as they enjoy strong economic foundations, higher growth rates and sound monetary policy measures.
US, China and Japan were ranked first, second and third respectively.
India ranked 19th in terms of budget balance as a percentage of the gross domestic product (GDP) and 12th in terms of public debt as a percentage of the GDP.
The ranking was based on seven economic indicators: size of the economy, spending power, tax structure, interest rate policy, budget balances, debt burden and foreign exchange reserves.
US, China and Japan were ranked first, second and third respectively.
India ranked 19th in terms of budget balance as a percentage of the gross domestic product (GDP) and 12th in terms of public debt as a percentage of the GDP.
The ranking was based on seven economic indicators: size of the economy, spending power, tax structure, interest rate policy, budget balances, debt burden and foreign exchange reserves.
Sunday, December 21, 2008
Texas Instruments to layoff 400 employees in Philippines
Texas Instruments, one of the world's biggest semiconductor manufacturers, is laying off 400 workers from its factory in the northern Philippines due to the global financial crisis, officials said.
The Labour Department's assistant regional director Sixto Rodriguez said the US-based company had notified the government of the cuts that will take effect on January 15, 2009.
He said the company has assured the government that it will give the laid-off employees all the necessary benefits and is offering them early retirement.
Company spokesmen would not comment however.
Texas Instruments employs about 2,300 people in its plant in the northern resort city of Baguio where it makes semiconductors -- conductive elements used in electronic circuits -- mostly for phone maker Nokia. It is the biggest taxpayer in the region.
The company has been operating in the Philippines for 28 years and was one of the pioneers of the electronics industry which has become the biggest export sector in the country.
Texas Instruments announced in May 2007 that it would invest around one billion dollars in a new test and assembly facility at the former US Airforce base at Clark, north of Manila.
The company would not comment on the fate of that plant in the face of the economic contraction that is hitting many countries.
The Baguio facility conducts final assembly and testing of semiconductors for customers in computer, aerospace, telecommunications and automotive industries in the US, Asia and Europe.
Press reports earlier said that Lear Automotive Services, a maker of automotive wire harnesses for export, was laying off 80 workers from its plant in the central Philippines.
Source: Agencies
The Labour Department's assistant regional director Sixto Rodriguez said the US-based company had notified the government of the cuts that will take effect on January 15, 2009.
He said the company has assured the government that it will give the laid-off employees all the necessary benefits and is offering them early retirement.
Company spokesmen would not comment however.
Texas Instruments employs about 2,300 people in its plant in the northern resort city of Baguio where it makes semiconductors -- conductive elements used in electronic circuits -- mostly for phone maker Nokia. It is the biggest taxpayer in the region.
The company has been operating in the Philippines for 28 years and was one of the pioneers of the electronics industry which has become the biggest export sector in the country.
Texas Instruments announced in May 2007 that it would invest around one billion dollars in a new test and assembly facility at the former US Airforce base at Clark, north of Manila.
The company would not comment on the fate of that plant in the face of the economic contraction that is hitting many countries.
The Baguio facility conducts final assembly and testing of semiconductors for customers in computer, aerospace, telecommunications and automotive industries in the US, Asia and Europe.
Press reports earlier said that Lear Automotive Services, a maker of automotive wire harnesses for export, was laying off 80 workers from its plant in the central Philippines.
Source: Agencies
Sunday, December 7, 2008
Rs 300,000cr package to boost Indian economy
The government on Sunday announced major tax cuts across the board to boost demand and allocated additional funds and incentives for exports, housing, textile and infrastructure to stimulate the economy, hit by the global financial crisis.
"The government has been concerned about the impact of global financial crisis on the Indian economy
and a number of steps have been taken to deal with this problem," an official statement said.
The package, coming on the back of fresh monetary measures announced by the RBI on Saturday, includes a four per cent cut in ad-valoram duty across the board, to boost additional spending, besides enhanced credit for exporters, along with a Rs 10,000 crore mop up for India Infrastructure Finance Company.
The measures include additional plan expenditure up to Rs 20,000 crore in current year; total spending in four months till March expected at Rs 300,000 crore. A series of steps to boost exports; Rs 350 crore additional funds for export incentives; back-up guarantee to ECGC for up to Rs 350 crore; to be allowed refund of services in some areas.
The package also includes import duty on Naptha for use in power sector as well as export duty on iron ore to be eliminated. India Infrastructure Finance Company to raise Rs 10,000 crore through tax-free bonds by March 2009. PSU banks to soon announce package for borrowers of home loans upto Rs 20 lakh. An across-the-board cut on ad valorem rate to encourage additional spending; additional Rs 1,400 crore for textile sector.
Source: Agencies
"The government has been concerned about the impact of global financial crisis on the Indian economy
and a number of steps have been taken to deal with this problem," an official statement said.
The package, coming on the back of fresh monetary measures announced by the RBI on Saturday, includes a four per cent cut in ad-valoram duty across the board, to boost additional spending, besides enhanced credit for exporters, along with a Rs 10,000 crore mop up for India Infrastructure Finance Company.
The measures include additional plan expenditure up to Rs 20,000 crore in current year; total spending in four months till March expected at Rs 300,000 crore. A series of steps to boost exports; Rs 350 crore additional funds for export incentives; back-up guarantee to ECGC for up to Rs 350 crore; to be allowed refund of services in some areas.
The package also includes import duty on Naptha for use in power sector as well as export duty on iron ore to be eliminated. India Infrastructure Finance Company to raise Rs 10,000 crore through tax-free bonds by March 2009. PSU banks to soon announce package for borrowers of home loans upto Rs 20 lakh. An across-the-board cut on ad valorem rate to encourage additional spending; additional Rs 1,400 crore for textile sector.
Source: Agencies
Tuesday, December 2, 2008
SBI to hire 4,280 employees for associate banks
The country's top lender, State Bank of India, said it is looking to hire more than 4,200 employees for its associate banks -- a development that comes within days of its plan to recruit 25,000 people.
SBI said in a public announcement today that it plans to recruit 4,280 clerical staff at its various associate banks for operations across the country.
The recruitment drive for its associate banks follows SBI saying earlier last month that it would hire 25,000 people in the current fiscal -- a move that comes at a time when banks across the world are mostly trimming their workforces in the backdrop of a global financial crisis.
The various associate banks for which SBI is looking to recruit the staff include State Bank of Bikaner and Jaipur, State Bank of Hyderabad, State Bank of Mysore, State Bank of Indore, State Bank of Patiala and State Bank of Travancore.
There are more than 1,000 vacancies each with State Bank of Hyderabad, State Bank of Patiala and State Bank of Travancore, between 240 and 440 employees would be recruited for each of State Bank of Bikaner and Jaipur, State Bank of Indore and State Bank of Mysore.
SBI Chairman O P Bhatt said on November 16 that SBI was hiring 20,000 clerical staff and 5,000 people in supervisory positions in the current fiscal. In its previous major hiring spree, SBI had announced, about a year ago, plans to increase its as well as the associate banks' headcount by about 10,000 people.
Last month, another state-run lender IDBI Bank said it was looking to hire about 650 people for its retail banking and SME finance businesses.
However, foreign banks have been mostly cutting down their payrolls, with biggest of them, Citigroup, recently saying that it plans to trim down its headcount by over 50,000 employees across the world, which reportedly includes about 1,000 employees in India.
Citi, which has already laid off over 25,000 people so far this year, plans to bring down its headcount to below 3,00,000 in the next few weeks, from more than 3,75,000 at the end of 2007.
American Express also recently said that it would lay off about 7,000 employees globally, which includes about 100 employees in India.
SBI said in a public announcement today that it plans to recruit 4,280 clerical staff at its various associate banks for operations across the country.
The recruitment drive for its associate banks follows SBI saying earlier last month that it would hire 25,000 people in the current fiscal -- a move that comes at a time when banks across the world are mostly trimming their workforces in the backdrop of a global financial crisis.
The various associate banks for which SBI is looking to recruit the staff include State Bank of Bikaner and Jaipur, State Bank of Hyderabad, State Bank of Mysore, State Bank of Indore, State Bank of Patiala and State Bank of Travancore.
There are more than 1,000 vacancies each with State Bank of Hyderabad, State Bank of Patiala and State Bank of Travancore, between 240 and 440 employees would be recruited for each of State Bank of Bikaner and Jaipur, State Bank of Indore and State Bank of Mysore.
SBI Chairman O P Bhatt said on November 16 that SBI was hiring 20,000 clerical staff and 5,000 people in supervisory positions in the current fiscal. In its previous major hiring spree, SBI had announced, about a year ago, plans to increase its as well as the associate banks' headcount by about 10,000 people.
Last month, another state-run lender IDBI Bank said it was looking to hire about 650 people for its retail banking and SME finance businesses.
However, foreign banks have been mostly cutting down their payrolls, with biggest of them, Citigroup, recently saying that it plans to trim down its headcount by over 50,000 employees across the world, which reportedly includes about 1,000 employees in India.
Citi, which has already laid off over 25,000 people so far this year, plans to bring down its headcount to below 3,00,000 in the next few weeks, from more than 3,75,000 at the end of 2007.
American Express also recently said that it would lay off about 7,000 employees globally, which includes about 100 employees in India.
Retailers tighten belts at Dubai shopping festival
Some big Dubai retailers, accustomed to giddy spending in the Gulf Arab tax-free haven, are grappling with a drop in sales as consumers worry about the impact of the global financial crisis on their wallets.
The Gulf has not been as heavily hit by the credit crisis as Europe and the US, but the contagion has led to stock market routs, tight lending conditions and a range of government and central bank attempts to mitigate its impact.
In the United Arab Emirates, home to the glitzy financial hub of Dubai where shopping is virtually a national sport, a frisson of fear has seeped into consumers' minds.
"Business is 20 per cent down in the last week in retail," Mohi-din Bin Hendi, president of Bin Hendi Enterprises, told Reuters.
"In the beginning, people did not take it seriously. When they start to get their ATM cards refused from the bank, that's when sense come back ... that this is serious."
Bin Hendi, whose retail-based conglomerate operates in the Gulf Arab region and India and offers everything from jewelry to sofas, said the firm would take steps to ready for a further decline in consumer spending and would "cut the desirables, go to the essentials."
Asked whether he would cut jobs, he said: "Absolutely. We have not come to a figure as yet."
"People with wise moves won't suffer as much as those who think this is only a cloudy day and it'll clear up tomorrow. It won't clear up tomorrow that easily.
"We have to sit tight, cut down our costs and be smart."
Dubai consumers have begun to see uncomfortable signs on the crisis' toll on the city, long known for spending excesses.
Companies are quietly shedding jobs or not hiring, according to recruiters, while the Arab world's biggest listed developer, Emaar Properties EMAR.DU recently gave buyers more time to pay for new homes given difficulties in obtaining mortgages.
The UAE's biggest bank has stopped lending to foreigners who work for top Dubai property firms on fears a slowdown could jeopardize their jobs and income and an Islamic mortgage lender, Amlak AMLK.DU, has suspended new loans altogether for now.
Less spending per person
"There is less footfall in the stores, people are tightening their belts," said a retail manager who declined to be identified. "It's never been like this before."
The global financial meltdown came just as the world's biggest mall opened in Dubai and nearly each week has seen the announcement of one lavish retail exercise after another.
This week, British luxury retailer Burberry said it had created a new firm with its UAE franchisee, Jashanmal, that would manage all its retail and wholesale operations in the Gulf Arab region.
Jashanmal Group President Gangu Batra said forming the joint venture made business sense given its long ties to the British firm but the timing could have been better.
"Now all we can say is I hope it doesn't affect us too much. There will be some effect and we will see that effect in the course of time," he told Reuters.
Batra said same-store sales on a yearly basis were steady at the retailer, which operates department stores, booksellers and franchises for brands like Calvin Klein, but the firm was bracing for a slowdown in the wider economy in coming months.
"People are still there but spending per person has gone down," he said. "I don't think our country will be immune to these problems.
"I can see some slowdown when I go to restaurants and hotels. The view is, so far, there's no reduction in the tourists but then when they do the booking, they do so months in advance."
According to a 2007 annual country report, visitors to Dubai represent 69 per cent of all luxury retail and leisure spending.
Batra said spending levels were likely to decline even further once the current wave of vacationers head home.
Caution has seeped into every aspect of consumer spending. One Dubai-based dentist said business had fallen about 40 percent this year. "People see it as cosmetic rather than essential," she said.
Source: Reuters
The Gulf has not been as heavily hit by the credit crisis as Europe and the US, but the contagion has led to stock market routs, tight lending conditions and a range of government and central bank attempts to mitigate its impact.
In the United Arab Emirates, home to the glitzy financial hub of Dubai where shopping is virtually a national sport, a frisson of fear has seeped into consumers' minds.
"Business is 20 per cent down in the last week in retail," Mohi-din Bin Hendi, president of Bin Hendi Enterprises, told Reuters.
"In the beginning, people did not take it seriously. When they start to get their ATM cards refused from the bank, that's when sense come back ... that this is serious."
Bin Hendi, whose retail-based conglomerate operates in the Gulf Arab region and India and offers everything from jewelry to sofas, said the firm would take steps to ready for a further decline in consumer spending and would "cut the desirables, go to the essentials."
Asked whether he would cut jobs, he said: "Absolutely. We have not come to a figure as yet."
"People with wise moves won't suffer as much as those who think this is only a cloudy day and it'll clear up tomorrow. It won't clear up tomorrow that easily.
"We have to sit tight, cut down our costs and be smart."
Dubai consumers have begun to see uncomfortable signs on the crisis' toll on the city, long known for spending excesses.
Companies are quietly shedding jobs or not hiring, according to recruiters, while the Arab world's biggest listed developer, Emaar Properties EMAR.DU recently gave buyers more time to pay for new homes given difficulties in obtaining mortgages.
The UAE's biggest bank has stopped lending to foreigners who work for top Dubai property firms on fears a slowdown could jeopardize their jobs and income and an Islamic mortgage lender, Amlak AMLK.DU, has suspended new loans altogether for now.
Less spending per person
"There is less footfall in the stores, people are tightening their belts," said a retail manager who declined to be identified. "It's never been like this before."
The global financial meltdown came just as the world's biggest mall opened in Dubai and nearly each week has seen the announcement of one lavish retail exercise after another.
This week, British luxury retailer Burberry said it had created a new firm with its UAE franchisee, Jashanmal, that would manage all its retail and wholesale operations in the Gulf Arab region.
Jashanmal Group President Gangu Batra said forming the joint venture made business sense given its long ties to the British firm but the timing could have been better.
"Now all we can say is I hope it doesn't affect us too much. There will be some effect and we will see that effect in the course of time," he told Reuters.
Batra said same-store sales on a yearly basis were steady at the retailer, which operates department stores, booksellers and franchises for brands like Calvin Klein, but the firm was bracing for a slowdown in the wider economy in coming months.
"People are still there but spending per person has gone down," he said. "I don't think our country will be immune to these problems.
"I can see some slowdown when I go to restaurants and hotels. The view is, so far, there's no reduction in the tourists but then when they do the booking, they do so months in advance."
According to a 2007 annual country report, visitors to Dubai represent 69 per cent of all luxury retail and leisure spending.
Batra said spending levels were likely to decline even further once the current wave of vacationers head home.
Caution has seeped into every aspect of consumer spending. One Dubai-based dentist said business had fallen about 40 percent this year. "People see it as cosmetic rather than essential," she said.
Source: Reuters
Saturday, November 22, 2008
Grim economic situation, says Hu Jintao
Chinese President Hu Jintao has warned the outlook for the world economy was not looking good, but that continued strong growth in China could help serve as a global buffer.
"The situation is very grim," Hu told world business leaders gathered in the Peruvian capital ahead of an Asia-Pacific economic summit.
"The sound and steady growth of the (Asia-Pacific) economy is threatened by the grim world economic situation."
Hu stressed that China's main contribution to world efforts to address the global financial crisis was to maintain steady economic growth at home.
"The steady and relatively fast economic development in China is in itself a major contribution to upholding international financial stability and promoting world economic development," he said.
China's growth, which soared by more than 11 per cent last year, slowed to 9.0 per cent in the third quarter this year, dragged down by economic slowdowns in key export markets such as the United States, Europe and Japan.
China has put together a four trillion yuan (586 billion dollar) stimulus package to shore up the economy, which for years had shown no signs of letting up as the country turned into the world's manufacturing hub.
China has repeatedly said it must focus resources on maintaining domestic growth amid rising expectations overseas that its 1.9 trillion dollars in foreign exchange reserves could be put to use fighting the world financial
woes.
However, Hu vowed China would step up its activity on the international financial scene. China "will play a more active role in international economic cooperation," he said, without offering details.
Source; Agencies
"The situation is very grim," Hu told world business leaders gathered in the Peruvian capital ahead of an Asia-Pacific economic summit.
"The sound and steady growth of the (Asia-Pacific) economy is threatened by the grim world economic situation."
Hu stressed that China's main contribution to world efforts to address the global financial crisis was to maintain steady economic growth at home.
"The steady and relatively fast economic development in China is in itself a major contribution to upholding international financial stability and promoting world economic development," he said.
China's growth, which soared by more than 11 per cent last year, slowed to 9.0 per cent in the third quarter this year, dragged down by economic slowdowns in key export markets such as the United States, Europe and Japan.
China has put together a four trillion yuan (586 billion dollar) stimulus package to shore up the economy, which for years had shown no signs of letting up as the country turned into the world's manufacturing hub.
China has repeatedly said it must focus resources on maintaining domestic growth amid rising expectations overseas that its 1.9 trillion dollars in foreign exchange reserves could be put to use fighting the world financial
woes.
However, Hu vowed China would step up its activity on the international financial scene. China "will play a more active role in international economic cooperation," he said, without offering details.
Source; Agencies
Tuesday, November 18, 2008
Now Japan also slides into recession
Japan’s economy slid into a recession for the first time since 2001, the government said, as companies sharply cut back on spending in the third quarter amid the unfolding global financial crisis. Government officials and economists warned that the world’s second-largest economy could contract further in coming months.
Japan’s economy shrank at an annual pace of 0.4% in the July-September period after a declining an annualised 3.7% in the second quarter. That means Japan, along with the 15-nation euro-zone, is now technically in a recession, defined as two straight quarters of contraction.
“What we’re starting to see is the extent of deterioration in external demand start to weigh more heavily on the Japanese economy,” said Glen Maguire, chief Asia economist at Societe Generale. “And I think looking forward, there’s every indication that dynamic is going to continue.”
The result was worse than expected. Economists surveyed by a news agency had predicted gross domestic product would gain an annualised 0.1%. Japan’s economy minister Kaoru Yosano said following the data’s release that “the economy is in a recessionary phase.”
But the worst may be yet to come, especially with dramatic declines in demand from consumers overseas for Japan’s autos and electronics gadgets. Hurt also by a strengthening yen, a growing number of exporters big and small are slashing their profit, sales and spending projections for the full fiscal year through March.
Japan’s economy shrank at an annual pace of 0.4% in the July-September period after a declining an annualised 3.7% in the second quarter. That means Japan, along with the 15-nation euro-zone, is now technically in a recession, defined as two straight quarters of contraction.
“What we’re starting to see is the extent of deterioration in external demand start to weigh more heavily on the Japanese economy,” said Glen Maguire, chief Asia economist at Societe Generale. “And I think looking forward, there’s every indication that dynamic is going to continue.”
The result was worse than expected. Economists surveyed by a news agency had predicted gross domestic product would gain an annualised 0.1%. Japan’s economy minister Kaoru Yosano said following the data’s release that “the economy is in a recessionary phase.”
But the worst may be yet to come, especially with dramatic declines in demand from consumers overseas for Japan’s autos and electronics gadgets. Hurt also by a strengthening yen, a growing number of exporters big and small are slashing their profit, sales and spending projections for the full fiscal year through March.
Friday, October 31, 2008
Financial crisis hits mobile phone market
According to IDC, third quarter shipment growth drops to 3.2 percent The worldwide mobile phone industry felt the impact of the global financial crisis in the third quarter of 2008 (3Q08) as total handset shipments were down significantly over previous quarters.
Mobile phone manufacturers shipped a total of 299.0 million handsets in 3Q08, up 3.2 percent from last year, and down -0.4 percent over 2Q08. The third quarter of the year has historically been a ramp-up quarter as manufacturers load their sales channels with handsets in preparation for the holiday season, producing year-over-year growth rates as high as 20 percent as a result.
This year has not witnessed a similar ramp up, largely due to the current economic situation.
Ryan Reith, senior research analyst, IDC's Quarterly Mobile Phone Tracker, said: "Handset vendors felt the pressures of the dismal economy in the third quarter of 2008, and as a result, shipments and revenues were down almost across the board. There were two signs of hope from two major players during third quarter earnings. First, as highly anticipated and now confirmed, Apple reported an extremely successful quarter and noted it is on pace to surpass its initial 2008 shipment estimates. Second Nokia's CEO Olli-Pekka Kallasvuo announced a positive outlook for 2008 despite a tough third quarter. This offers reassurance to all industry players as Nokia has been a clear leader in the mobile phone space for quite some time."
Looking forward to the holiday season, mobile phone average selling prices have already begun to drop and marketing campaigns are ramping up, and competition for buyers will remain high as spending will be a concern to consumers. IDC expects tight economic conditions will make 2009 slower and more competitive as well.
Ramon T. Llamas, senior research analyst, IDC's Mobile Devices Technology and Trends, said: "While the overall mobile phone market registered small growth compared to last year, the market for converged mobile devices (commonly known as smartphones) posted strong gains. The worldwide release of the Apple iPhone 3G earlier this summer marked a major step not only for Apple, but also raised the profile of converged mobile devices as a whole."
"Add on top of that the attention generated by the Google-powered G1, and the converged mobile device suddenly finds itself as the device sought by both seasoned and first-time users," he adds.
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