Turkey’s record-breaking investments: as good as they sound?
At first sight the figures are staggering. In the space of a single day last week Turkey signed an agreement on a $22bn new nuclear power plant and concluded a €22bn tender on building Istanbul one of the biggest airports on the world.
No wonder there were proclamations about record-breaking investments as soon as last Friday’s announcements were made. Continue reading »
L&T: deals in the works?
Indian markets are buzzing with gossip about Larsen & Toubro (L&T), the Indian conglomerate, over two possible deals.
Although nothing is confirmed, analysts are expecting some deal activity to materialise – and the share price is getting a bumpy ride. Continue reading »
Poland: lots of construction, but where are the companies?
Poland is coming off the biggest construction boom in its thousand-year history and it does have a lot of roads to show for the effort – but there is one stark gap: Poland has not managed to produce any significant construction companies.
That was not the case in Spain, which underwent its own road construction boom that kicked off when it joined the EU in 1986. A new report by conultants Ernst & Young takes a closer look at just what went wrong in Poland compared to the Spanish experience. Continue reading »
China: shining a light at the machinery
January was a scary month for China’s machinery makers and their investors. First, Zoomlion was accused by a “concerned investor” of booking phantom sales, then Caterpillar accused its own recently-acquired Chinese subsidiary of accounting misconduct and took a $580m write down on the value of the deal.
Time for a ghostbusting analyst to bring some rational rigour to the sector. Continue reading »
Warsaw Modlin’s bleak outlook
Air travellers frustrated at delays in London, Paris and Frankfurt can put their woes in perspective – Warsaw’s suburban Modlin Airport looks like it will be shut for several months, playing havoc with the finances of the low-cost carriers using the new airport.
The reason is that Modlin’s newly-built but already crumbling runway is not fit to accommodate the large airliners that are supposed to land on it. The local building inspector is supposed to issue his verdict by Thursday but indications are that it will be closed until about May. Continue reading »
Myanmar struggles to meet tourist demand
Since a change of government just two years ago, Myanmar has thrown off its previous isolation to become a top regional tourist destination. Queues for visas at its embassy in Bangkok last week stretched down the street. “Do you know how many visas we issued today?” said a harried-looking consular official. “More than 1,200. It’s going crazy.” But the question that has remained unanswered is: where are these people going to stay? Continue reading »
China banks wary of steel traders
China’s banks are about to start installing CCTV cameras in steel traders’ warehouses to make sure those traders are using their bank loans to actually trade steel – such is the erosion of trust in that sector.
Banks realised at the end of last summer that things were not going so well for their exposures to the traders, perhaps because, as it turned out, many smaller and mid-sized operations had been using some of their bank loans for purposes other than buying and stocking steel products. Continue reading »
China urbanisation: Lords of the ring
Li Keqiang, China’s next premier, says the country must unleash urbanisation as its next big growth engine. That makes sense –China’s urbanisation rate is still just 50 per cent, well below the 80 per cent norm in developed economies.
But the government’s top-down push can play out in funny ways. If Li needs any reminder, he can look to his old stomping ground, the northeastern province of Liaoning. It is pioneering a new mode of development: start with the showcase monument, then build the city. Continue reading »
Brazil: going horizontal? Not really
A few months ago, Alexandre Tombini, governor of Brazil’s central bank, told beyondbrics that Brazil was finally “going horizontal”. Enough of picking winners and piecemeal, ad hoc measures, he said: it was time for across-the-board reforms that would deliver a more efficient economy and a level playing field for all.
So much for that. Back in the present day, Guido Mantega, optimist and finance minister, on Tuesday announced cuts in payroll and other taxes and a special line in finance for the construction industry. After Friday’s shocking GDP figures, it looks like a knee-jerk effort to get the economy moving – or at least its most labour-intensive sector. Continue reading »
Areva excluded from CEZ nuclear bid, leaving US and Russian rivals
By Nicholas Watson of bne
In a shock announcement, Czech power company CEZ on Friday excluded France’s Areva from its multi-billion-euro tender to expand the Temelin nuclear power plant for failing to fulfill all the requirements, leaving Toshiba’s US unit Westinghouse and a consortium led by Russia’s Atomstroyexport as the two remaining bidders. Continue reading »
From cheap shoes to giant malls, in Manila and beyond
Regular visitors to the Philippines may not have heard of SM Investment Corporation. But they have almost certainly seen or been into one of more than a dozen giant shopping centres it owns in metro Manila, the name given to the capital and its adjacent sprawl. They are hard to miss. Three of them, including the third and 10th biggest in the world, are located along EDSA, the main thoroughfare that bisects the metropolis. Continue reading »
Shanghai up on China spending (plus a bit of ECB…)
Good news for a change – but which bit of good news? The Shanghai composite index closed up 3.7 per cent on Friday. The ECB bazooka may be giving markets a boost worldwide, but in China, the bigger news is the Rmb1tn ($158bn) of infrastructure spending was given the green light.
Construction and cement stocks led the way, with Sany Heavy, China’s biggest construction-equipment maker, among the big gainers at 9.97 per cent. In fact, 25 stocks hit the 10 per cent upside limit on the market, with another eight stocks gaining between 9.90 and 10 per cent. Continue reading »
Poland: shock dip in industrial growth
The Polish economy is finally giving ground in the face of the blasts blowing from the eurozone. Having surprised economists with its resilience during much of the post-2008 global crisis, it delivered a bit of a shock on Wednesday with figures showing industrial production rose by only 1.2 per cent last month. Continue reading »
Corporate watch: PBG’s highway to nowhere
It was all going so well. Jerzy Wisniewski rode up the ranks of Poland’s rich list on the back of his construction company, PBG. Its crowning achievement was to scoop up some of the enormous road and stadium building contracts that came with Poland’s co-hosting of the Euro 2012 football championships.
The result was disaster. PBG, which has 7,000 employees, recently filed for bankruptcy and Wisniewski, who owns about a quarter of the company’s shares, has been bounced from the job of chief executive. Continue reading »
Poland: support for troubled builders?
Should the Polish government coming to the rescue of Polish construction companies that got into financial trouble after bidding too low for big infrastructure projects, not least the motorways that brought fans to the Euro 2012 football championship?
Yes, say the economy and treasury ministers. No says Jacek Rostowski, the hard-headed finance minister, credited with steering Poland’s steady course through the global financial crisis. Continue reading »
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