Exclusive outtakes from industry leaders
By Petra Spescha
European economists have been nearly unanimous about what Europe’s recovery from the crisis will look like on a chart: L-shaped — a severe slump with a prolonged period of flat or minimal improvements in the economy.
But at the Reuters Central European Investment Summit Ewald Nowotny created a new shape when he tried to clarify a statement he made to an Austrian newspaper earlier this month about the economic turnaround.
“It was not a real L-shape –it was an L which was a bit upward bending,” Nowotny, who is on the European Central Bank’s Governing Council, said.
So it appears Nowotny, an economics professor, takes a less pessimistic view of the recovery than we previously thought. Not quite a rebounding ‘V’ shape or a steady ‘U’-shaped rise but somewhere in-between those shapes and the downbeat ‘L.’
The U.S. recession and global credit crisis pulled a stunning array of corporate giants into bankruptcy court this year. Automakers General Motors and Chrysler, real estate company General Growth, and chemicals maker Lyondell all sought protection from their creditors after being brought down by rapidly changing economics and customer demands.
While the sudden shift in fortunes for some of the world’s biggest companies wiped out the savings of some equity investors, the changes have paved the way for new and interesting investment or takeover opportunities for other investors.
Reuters Central European Investment Summit, September 28-30, 2009
The former Communist countries of central Europe have been the last to be hit by the global economic crisis, but th e hit they took was among the hardest. Only big neighbour Russia’s deep plunge into recession is rivaling the sharp fall from record economic growth that’s in store this year for the economies between the former Soviet Union and Western Europe.
Global risk aversion and deleveraging exposed the weaknesses that the countries had been able to gloss over during the boom years – which in retrospect appeared to have been, in some countries, a colossal binge bankrolled by cheap foreign credit extended by Western European banks that had to come to an end when funding dried up.
Russian banking and aviation magnate Alexander Lebedev, owner of London’s Evening Standard, estimates that Russian bureaucrats have pocketed $500 billion in bribes in the past four years and corruption and red tape make Russia one of the worst places to invest on earth.
On the scale of bureaucratic outrages, Lebedev hit a personal low when the authorities asked him to produce a 100 page report on bee poo. They claimed to be concerned about the excrement produced in the hives at one of his farms.
It not only trumpeted the idea, but was one of the first big local firms to take out offices in a sleek glass skyscraper by the Moscow River, surrounded by foundation pits and towers of naked steel girders that were to become Moscow’s Canary Wharf.
Stephan Dolezalek, Managing Director of VantagePoint Venture Partners and Tom Werner, Chief Executive of solar power company SunPower, sat down at Reuters’ Global Climate and Alternative Energy Summit in San Francisco and shared their views on global warming, investment and cleantech.
Dolezalek sees industrialization in developing countries as a more predictable impetus for investment than global warming.
Ken Oshman, the Chief Executive of Echelon, sat down at Reuters’ Global Climate and Alternative Energy Summit in San Francisco to speak about revenue forecasts and smart meters.
The following is Oshman’s thoughts on how the sector may consolidate as the market picks up.