Thursday, June 30, 2011

US: Small business borrowing surges

Borrowing by small businesses rose at a record pace in May, data released by PayNet Inc on Thursday showed, a sign that economic growth is poised to pick up in coming months.
The Thomson Reuters/PayNet Small Business Lending Index, which measures the overall volume of financing to U.S. small businesses, rose 26 percent in May from a year earlier, PayNet said.
The index is now at its highest since July 2008, two months before the collapse of Lehman Brothers and the near derailment of the world financial system.
Borrowing by small businesses is seen as a harbinger for the broader economy because they account for as much as 80 percent of new hiring. The loans PayNet tracks are typically used to buy or update plants and equipment.
The Federal Reserve has kept rates near zero since December 2008 to try to pull the economy from the worst downturn since the 1930s.
Last week Fed officials reiterated their promise to keep rates low for an extended period, but predicted a slower-than-expected Spring would give way to faster growth later this year.
Dallas Fed President Richard Fisher on Tuesday said he expects 4 percent growth in the second half, more than twice the 1.9 percent pace in the first quarter.
Thursday's data on small business borrowing bears up that optimistic view. Changes in the index typically signal developments in the overall economy two to five months in advance.
"If small businesses are taking these kind of chances, taking risks, making long term investments, they are seeing some long-term opportunities on the horizon," PayNet founder Bill Phelan said in an interview. "That's got to be a big positive sign for the economy."
Separate data also released on Thursday showed small business loan defaults at their lowest in five years, tying records set in April and May 2006.
Accounts in moderate delinquency, or those behind by 30 days or more, fell in May to 1.95 percent from 2.06 percent in April, PayNet said on Thursday.
Accounts 90 days or more behind in payment, or in severe delinquency, fell to 0.59 percent in May from 0.63 percent in April.
Banks with improving asset quality outnumbered banks with deteriorating asset quality by four to one, Phelan said.
Accounts behind 180 days or more, or in default and unlikely to ever get paid, fell to 0.75 percent of total receivables in May, from 0.77 percent in April, according to PayNet, which provides risk-management tools to the commercial lending industry.
(Source: Reuters)

Take cotton success story forward

Chinthi Reddy, a farmer in Warangal, Andhra Pradesh, who cultivates cotton with Bt seeds on his five-acre land, says: “Life has never been so good.” Reddy has installed drip irrigation in his field at an investment of Rs 70,000 and sent his son to the UK for MS studies in 2008. What's more, earning Rs 20,000 per acre in his cotton fields and saving Rs 7,500 per acre on account of less pesticide use has given him the added financial muscle to purchase more land for farming.
Reddy's story resonates with that of 60 lakh farmers who plant cotton with insect-protection technologies across India. This is a story of the transformation of cotton farming in India since 2002.


Across the large cotton-growing States, Bt cotton technology seeds are improving the lives of Indian farmers by providing them with savings on insecticide , higher yields, higher income, and helping them live with dignity.
Cotton production in Andhra Pradesh increased two-and-three-quarter times since the first planting of Bt cotton seeds, and farmers earn Rs 4,500 crore incremental income per annum by using hybrid Bt cotton seeds, as opposed to non-Bt varieties.
Imagine the improved status of our farmers if we can leverage the potential of these technologies with the right regulatory and market policies across crops. The power of plant technologies cannot be denied — they lifted India to the position of world's second largest producer and exporter of cotton, from being a large importer until 2002.
Today, the cotton farmer has more choices than ever before with 300 Bt cotton hybrids approved by the Government for cultivation.
The Indian farmer has rapidly adopted higher-yielding hybrid seeds with Bt cotton technologies, twice as fast as US farmers, and a third faster than Chinese farmers — a clear sign of the robust value derived from these technologies. Why stop them or deny them access to the latest technologies?

Benefits of technology

Today, India has the world's fourth largest area cultivated under biotech crops. Technologies have provided farmers with cumulative benefits surpassing Rs 31,500 crore from 2002 to 2009 (ISAAA). Studies further reveal that 87 per cent of India's Bt cotton farmers enjoy better lifestyles, 72 per cent invested in their children's education, and a significant 67 per cent repaid their long-pending debts (IMRB).
Seed biotechnology enhances food, feed, and fibre crop production; promotes resource conservation and energy efficiency; reduces the environmental footprint of agriculture by using lesser water, land and energy; improves economic viability for farmers and communities; and advances agriculture product safety.
India needs farmer-friendly regulation comparable to Brazil, the Philippines, and the US, and encouragement of R&D. Plant science and politics must not mix.
With population increasing and arable land decreasing, increasing yield and productivity is the only way to solve the food insufficiency problems.
Biotech seeds can help provide these benefits in a sustainable way, so that increasing populations can be fed without additional pressure on natural habitats, and simultaneously give a much needed fillip to rural incomes and quality of life.
The first fallacy is that farmers need to purchase hybrid seeds every year. GM technology is independent of the farmer's choice to buy seeds every year or save seeds from his crop. More importantly, it is recommended that hybrid seeds are bought every year as the virility or vigour of the seeds weaken every time the saved seeds are re-sown. The fact is Bt technology can be inserted either in hybrids or OP varieties. The seed is the hardware, the Bt technology is the software.
Second, it is believed that GM technology leads to loss of biodiversity. The variety of biological and genetic diversity is progressively reduced in the commercial arena because of the process of selection and breeding.
Genetic diversity is maintained in the gene banks of various governments and institutes. Current biotech crops have equal or less impact on biodiversity compared with conventional crops. Biotech crops have contributed to the development of conservation farming, which can significantly reduce erosion and restore soil quality, and conserve topsoil and moisture content, which in turn helps preserve biodiversity. Another commonly cited argument is that GM technology increases the cost of seeds. Farmers are intelligent and choose the seeds that provide them with the highest yield, income and ease of cultivation. The farmer's cost of Bt cotton hybrid seeds account for around 5 per cent of the total cost of cultivation, while labour and fertiliser costs account for over 30 per cent of his input costs. Plus, hybrid Bt cotton seeds help him double his production, creating significant insecticide savings.

Wide choice

It is said that Indian farmers will become dependent on foreign companies as seeds are imported. First, Indian cotton farmers have the widest choice as India is the world's most competitive market for cotton seed. Bt cotton technology is available from five different sources, including Indian and global technologies, with one source being the the Government's of India's CICR. Second, more than 350 Bt cotton hybrids are approved for use by the Government of India, providing the farmers with a wide choice. In India, it is compulsory to test and register all seeds at local State Agriculture Universities within the ICAR system. This ensures that only good quality locally relevant seeds are available. Farmers always only buy seeds developed to suit their agronomic and environmental conditions and based on their experience. In any case, the actual seed is produced by the Indian companies. Even in Bt cotton that is the only GM crop approved and is being used in India, 90 per cent of the seed used by the farmer is produced by Indian companies. No Bt cotton seed is imported and sold to the farmers.


As for the belief that GM foods are not safe for human beings, the safety of GM crops is established through various rigorous regulatory data generation work done in different parts of the world, including India.
Scientists and international health organisations including WHO, FAO, among others, have concluded that biotech crops, foods, and feeds are as safe as conventionally bred crops, foods, and feeds. Over 3,200 renowned scientists worldwide have signed a declaration in support of agricultural biotechnology and its safety to humans, animals, and the environment. Biotech crops are among the most extensively tested foods in the history of food safety.
The view that Europe does not grow GM crops and hence we should also not grow them is also commonly voiced. GM crops are being cultivated in six European countries and another 27 European countries have approved the consumption of GM foods by their population. They import and consume GM food in these countries.
(Source: Mr. Ram Kaundinya, MD, Advanta India)

Credit to agriculture slows down this fiscal

An unfavourable monsoon and the after-effects of the agriculture debt-waiver scheme have together led to a slowdown of credit flow to the agriculture sector in May 2011.
The personal segment, which includes loans for homes, vehicles and consumer durables, saw a higher growth as consumption demand continued to be strong.
According to the Reserve Bank of India's data on sectoral deployment of credit for the month of May, credit to agriculture on a year-on-year basis increased at a slower pace (12.8 per cent), compared with 21.6 per cent in the previous year.
As on May 20, 2011, the bank credit to agriculture and allied activities was Rs 4,50,780 crore, against Rs 3,99,494 crore in May 2010, a growth of 12.8 per cent.

Key reasons

“There is a decline in the demand for agriculture loans and there are several reasons for this,” said a senior official from a public sector bank.
One reason was the climatic condition. Due to sporadic monsoon, the sowing season has started later than normal. Therefore, farmers are not taking loans.
Another reason was that bulk of the farmers who were eligible for the agriculture debt-waiver scheme (where the farmer had to pay 75 per cent of the loan amount in a single instalment), were not in a position to pay their share of the loan amount. Due to this their loans turned into non-performing assets (NPAs) and they were not eligible for fresh loans.
“About 60 per cent of the farmers were unable to pay their share of the loan repayment,” the official said.
In addition, farmers who were eligible neither for the waiver nor debt-relief schemes did not repay their dues, due to which those loans too turned into NPAs. These farmers also were not eligible for fresh loans, the official added.
Many banks have already reported a rise in NPAs in the agriculture sector in the quarter ended March 31, 2011.
Personal loans increased by 17.7 per cent in May 2011, in comparison with the growth of 5.6 per cent during the corresponding period of the previous year.
As on May 20, 2011, personal loans stood at Rs 6,93,204 crore, against Rs 5,89,003 crore, as on May 21, 2010. Most of the components of personal loans, such as housing, advances against fixed deposits, vehicle loans and consumer durables registered accelerated growth, said the RBI.

Non-food credit

On a year-on-year basis the total non-food gross bank credit increased by 21.9 per cent in May 2011, as compared with 18.1 per cent in the corresponding period of last year, said the RBI.
Loans to industry increased by 26.7 per cent, compared with 25.8 per cent. The services sector saw higher credit growth at 21.8 per cent, as compared with 15 per cent.
(Source: Business Line)

Biotech crop acreage touches a billion hectares

You like it or hate it, but you cannot ignore it. Biotechnology in agriculture has come of age. Recently, 100{+t}{+h} crore hectare was sown with a biotechnology crop in the US even as biotech crops spread to Eastern and Western Africa and Pakistan.
In the last few years after its introduction in 1996, biotech crops spread significantly as biotech cotton and maize caught the imagination of farmers. Speakers at a convention on ‘Demystifying crop biotechnology’ here said biotech in agriculture was going to play a major role as global population reached 1000 crore in 2050.
“It took 10 years to reach the first 50 crore hectares in 2005, but the second 50 crore ha came in just five years,” Dr Clive James, Chair of ISAAA (International Service for the Acquisition of Agri-biotech Applications), said, elaborating on the accumulated acreage of biotech crops.
India held the fourth position with 94 lakh ha in 2010 after the US (6.6 crore ha), Brazil (2.5 crore ha) and Argentina (2.2 crore), he said. Last year, the area under biotech crops was 14.8 crore ha, with 1.54 crore farmers growing these crops.
“By 2015, we expect that the area would grow to 20 crore ha as 50 lakh more farmers are likely to take to the crops,” he said.
Talking on ‘Global state of crop biotechnology’ here on Monday at the three-day annual conference of Asian Media Information and Communication Centre, he said genetically modified and biotech crops were not a panacea for the food problems the world faced. “It is not a golden bullet to solve them. It, in fact, is essential,” he said.
Dr William Dar, Director-General of ICRISAT (International Crops Research Institute for Semi Arid Tropics), said the global population would cross the 1,000-crore mark in 2050. This would require 70 per cent increase in food production.
(Source: Business Line)

Tata DoCoMo ups SMS, STD call rates; others seen following suit

In what could be early signals of an increase in mobile phone tariffs, some new telecom operators have quietly tinkered with the charges for voice calls and text messages.
Tata TeleServices, which had ushered in a tariff war with its per-second billing-based GSM offering two years back, has revised the rates for all new subscribers of Tata DoCoMo in every circle it operates.
According to a Credit Suisse report, Tata DoCoMo has raised local SMS tariffs by 67 per cent to Re 1 an SMS (from 60 paise earlier) for local SMS and by 25 per cent for national SMS to Rs 1.50 (from Rs 1.20). STD call tariffs will be doubled to two paise a second from the second year of subscription.
Analysts feel it is just a matter of time before the other telecom operators follow suit. “Well-entrenched vendors will seize this opportunity to raise tariffs, especially when it comes to national calls. This move by Tata Tele will enable them to take tariffs to a level at which they are comfortable operating,” said Mr Rishi Maheshwari, Vice-President, Research, Enam Asset Management. 
While operators, including Vodafone, Bharti Airtel and Reliance Communications, did not offer comments on their pricing strategy, these companies have in the past said the tariffs are not sustainable. At one paise a second (for voice calls), base tariffs in India are the lowest in the world.
A spokesperson for Tata TeleServices said the rationalisation in SMS tariffs is ‘in line with the market and applicable to all new subscribers'. “For us, ‘Pay Per Use' goes beyond any single sliver of usage and continues to be the central tent-pole of our consumer commitment… Our tariff offering, hence, will continue to be without conditions on our pay per use platform — the specific rates could change appropriately and in response to market conditions,” the spokesperson said in a written response to a Business Line questionnaire.
However, officials at some of the new telecom operators feel that call rates could go down further if there are regulatory changes. “There is still room for national long-distance, international long-distance and roaming charges to go down if interconnect usage charges are rationalised… It is now up to the Government to take a call,” a senior official said.
(Source: Business Line)

Rise of Indian social media entrepreneurs

Booming social media prompts organisations to seek help from Indian entrepreneurs to transform virtually every part of their business operations, writes Peerzada Abrar.

Last year, Amit Agrawal, a Jaipur-based consultant, bought a Dell Laptop for 33,000. Within seven to eight days of purchase, the machine started to crash repeatedly and could not play videos or music. Agrawal went to the company service centre several times, but they could not solve the problem.

After eight months of struggle to use the laptop, he filed a complaint on Akosha, an online forum that helps Indian consumers in getting their grievances against companies resolved quickly. Agrawal soon got a call from a top Dell official, who sent engineers to his home and the problem was solved in few days.

Delhi-based Akosha was founded by Ankur Singla, a lawyer who practiced with the law firm Linklaters in London, before he returned to India to launch the venture. Brands getting serious about their reputation have spurred the birth of a breed of social media entrepreneurs like Ankur Singla.

"Apart from helping consumers, we help brands increase customer satisfaction levels by winning back these unhappy customers," says Singla, who will soon enable consumers to file complaints from their Facebook accounts. As more Indians join social media sites such as Facebook, LinkedIn and Twitter, consumer brands are relying on a new breed of social media start-ups such as MediaREdifined, Blogadda and Blogworks to build and track online chatter about them and manage their online reputation.

"Realising the business potential of this medium, a rising number of entrepreneurs are developing innovative products especially for the Indian market based on social media," says Nasscom regional director Avinash Raghava.

Over two million Indians accessed social media sites over the past year and it is expected to grow 36 times in the next three years, according to a report 'Indian Social Media Landscape' by market research firm Nielsen. Of the 80 million Indians online, one-third of them are on social media sites, according to the report. "Companies have now realised that one person posting or tweeting negative comments can influence millions of people," says Raj Mruthyunjayappa, managing director of Talisma Corporation, a customer relationship management software solution provider.

Social media becoming a vital business tool is compelling organisations and even local businesses to seek help from entrepreneurs to transform virtually every part of their business operations. This includes handling marketing, customer service and sales, to product development and human resources. India Emerging profiles a bunch of such start-ups.

Vangal Software and Services

Bangalore-based Vangal, founded by former Hewlett-Packard executive Vinita Ananth, uses social media analysis technology to understand the brand impact. It then provides those insights to its customers. This includes social analysis of impact on brands linked to the 2G scam to the analysis of Indian Premium League Cricket discussions, so that advertisers can come up with ads for target audience.

It indexes and spiders over 92,000 mainstream media sources including print, radio, television and dailies, over 700 million blogs and over 500 million social network users, microbloggers and mobile users. In just one year of operations, Vangal has notched up over 200 customers including brands such as Dell, Volkswagen , Mercedes Benz, Hyundai, Tissot and Samsung


Jivity, a social commerce company founded by serial entrepreneur Mukund Mohan, leverages social media to help businesses promote themselves through merchandising. It helps brands increase their recall, loyalty and engagement.
This is done by leveraging technology to help fine tune merchandise requirements of the brands, customers and employees. It boasts of working for over 40 power brands such as DELL, MindTree and HCL . Jivity works with over 100 high-profile merchandise partners such as Mont Blac, Reebok, Samsonite, Titan and Louis Philippe, who manufacture quality corporate give aways. Its catalogue features 15,000 unique merchandise in two hundred product categories from apparel to custom tour packages. The company has attracted investors such as VenturEast, Argonaut and eYantra Industries.

Founded just weeks before the Cricket World Cup 2011,, is the world's first social network for cricket fans. was founded by Pradeep Chopra, Manas Garg and Kapil Nakra who are cricket lovers and batchmates from IIT . They realised that 'socialising around cricket' is what every cricket fan around the world enjoys. Their business model is built around advertising. People buying virtual items using real money is another monetisation opportunity for them.

Going forward, social gaming, social prediction of match outcomes and virtual betting are some of the features they plan to implement on The founders will also open up the platform for matches being played in universities and colleges.


The one-year-old start-up founded by Subramanya R Jois, has developed products that is helping people to buy different deals from retailers and find jobs using Facebook and other networking websites.

Jois said their product BuzzDeals can help merchants and retailers to reach over one million Facebook users in a month to sell different deals. Another product '' helps people to find jobs. They can upload their resumes, LinkedIn profiles and twitter accounts that recruiters and companies can access. According to Nielsen report, social media is so popular among Indian internet users that consulting firms in the country will hire 35% of their staff from LinkedIn and other online social sites.


It is India's first social sharing platform for television programme recommendation. Founded by Rabi Gupta and Ashish Kumar, the start-up provides instant information on all the happenings on television on the basis of user profiles, geography, tastes and interests.

Users of iDubba can recommend shows to friends, get suggestions as to what to watch on TV, and set SMS reminders. It has also created a platform that TV broadcasters can utilise effectively to listen to their audience. "The benefits of social business are too great to ignore," says Karthik Padmanabhan, country manager, IBM social business & collaboration solutions.

California-based market research firm Radicati Group expects the total number of worldwide Social Networking accounts, including both consumer and enterprise accounts, to grow from about 2.4 billion in 2011 to about 3.9 billion in 2015.

Though the space is still nascent in India, it is expected to expand with the rise in internet penetration and the advent of 3G telephony in the coming years.

"This will open up immense opportunities for entrepreneurs catering to this market," says Raghava of Nasscom.
(Source: Economic Times)

With HNIs mushrooming, companies hire specialists to service Ultra-Rich

Sanjay Sinha is a salesman with a difference. An MBA in marketing from a premier institute, Sanjay works for a showroom in New Delhi selling Mercedes-Benz cars. Sanjay's peers, most of whom are at best graduates, may be chasing stiff sales targets, but he gets his kick out of clinching 'special' deals. After all, selling marquee cars starting from Rs 26 lakh and going up to Rs 85 lakh is not like peddling any other consumer item. Sanjay brushes shoulders with the ultra-rich , celebrities and the who's who. People like Sanjay are redefining the role and image of talent in a growing tribe of companies targeting ultra-rich consumers.


With the number of high-networth-individual (HNI) households in India set to triple to more than two lakh over the next five years (according to a Kotak Wealth-Crisil report released last month), a number of companies are creating and grooming a specialised workforce adept at meeting this demand. HNI consumers are heavy spenders, be it on high quality homes, food, clothing, or the luxuries of life. Indian HNIs invest one-fifth of their income for growing their wealth, opening up many business opportunities. The demand for specialised talent to target HNIs could go up to one lakh people over the next 5-7 years.


In this backdrop, companies are seeking out 'specialised talent' from institutes and assiduously grooming them. No longer is educational qualification the only criterion for recruitment; soft skills and sophistication are beginning to play a larger role in selection. "The first question we ask such job seekers is the size of their visiting card holder and the number of relationships they can bring along, even before evaluating their skill sets," says E Balaji, MD & CEO of headhunter Ma Foi Randstad.

Not all candidates, he adds, are suited to becoming HNI specialists , even those from the Indian Ivy Leagues. "Hence, a lot of the companies are experimenting with newer ways to build a talent pipeline to sustain growth opportunities," says Balaji. Mercedes-Benz India has tiedup with polytechnic colleges in Pune and Aurangabad to recruit technical manpower who are subsequently trained for a year to handle after-sales service. The company has also started a year-long training for its sales and marketing forces. "We are recruiting engineers, MBAs and people from the hospitality industry for sales and marketing.

A lot of the training is focused on soft skills and business etiquette. This holds true even for the floor staff at dealers since they are like our extended arms," says Mercedes-Benz India director (corporate affairs & HR) Suhas Kadlaskar. Mercedes-Benz's optimism comes from its roaring sales in India. The company has already sold more than 6,000 cars in India , which is what it sold in all of 2010. It currently employs some 650 people and is on a hiring drive with plans to grow manpower base by 35% next year. The growth story is no different at financial services company , Edelweiss, which last year forayed into private wealth management for clients who have an investable surplus of more than Rs 5 crore.

"Since this is all about managing wealth, the key is to find the right people and build the right culture," says Edelweiss Capital group head (HR) Shaily Gupta. Edelweiss, which has started a three-to-six month internal training programme for HNI wealth managers, is now planning to expand this initiative by rolling out a one-year private banking programme. It is also evaluating options to tie up with some educational institutions. "Just like the IT industry created its own talent pool, we have to do the same for HNI marketing and wealth advisory since there is no ready talent," says Edelweiss Capital senior VP (wealth advisory and investment services) Anshu Kapoor.

Already, more than 1,500 people have shown interest in the course, while the first batch of 15-25 people will start next month. The job comes with its own set of perks, for the specialisation it involves . The entry-level salary for those servicing HNI clients are 20-30 % more than their counterparts in regular jobs. So, an entrylevel wealth manager for HNI clients can earn Rs 7-8 lakh compared with Rs 3-5 lakh for banking professionals. The variable and bonus component, too, is quite high for HNI marketers and can go up to 100% of the base salary.

At Edelweiss, an HNI specialist can earn up to 5-6 times of their performance bonus unlike a manager in other disciplines. "The compensation of HNI specialists in India is becoming equal to what it is in the West due to sheer paucity of specialised talent. In fact, professionals can make much more in dollar terms in India given the opportunity , with high variable and bonus component ," says Kapoor. "The compensation for HNI specialists is more performance-linked than for others , thereby increasing their total income opportunity," says Balaji.


There is a lot that goes into training HNI specialists. Most programmes focus on developing soft skills, customer relationship, understanding high net worth-consumer behaviour and theories on selling luxury brands. This apart, each organisation has specific modules suited to their needs. The training programme at Mercedes lasts for a year, and includes technological updates, but companies like Standard Chartered have structured it in a way that it lasts through the life cycle of the employee in the organisation with regular refresher courses (see chart). The bank has already recruited more than 250 relationship managers for its HNI clients, says Standard Chartered's regional head of HR (India & South Asia) Madhavi Lall.


LG Electronics India is creating specialised roles for managers to target the HNIs, while charting career growth plans even for shop floor executives who are outsourced , intending to absorb some of them with training. The company, is evolving its talent pool in line with the change in business strategy. LG India is planning to increase the sales of premium products from 28% of total sales to 35% by this year.

"Since shop sales executives are our brand ambassadors with customers , we are upgrading their skills and training them on how to handle HNI clients. The quality of interaction in the shop will build the consumer's perception of whether LG is premium or not," says LG, COO, YV Verma. The opportunity for growth in servicing HNI clients is a lure for many professionals. Seasoned Indian HNI marketers and wealth managers, who were working abroad, are now looking for opportunities in the country. Edelweiss's Kapoor says five such Indian-origin professionals have joined the organisation from the US and Middle East.

"The biggest kick in selling premium products to HNI consumers is to interact regularly with such people and celebrities ," says Dhananjay Chaturvedi , MD of German premium appliances maker Miele India. Miele India sells ultra-premium kitchen appliances like refrigerators priced at Rs 20 lakh. Shilpa Sinha, who quit as a sales executive with a leading luxury apparel brand to join an MNC bank as HNI relationship manager says,"You can build contacts in this profession which is otherwise difficult."
(Source: Economic Times)

India's domestic travel demand up by around 14 percent this year

Domestic air traffic demand in India grew by around 14 per cent with the airlines enjoying an average load factor of almost 79 per cent in May compared to last year, even as the global traffic rose by 6.8 per cent.

"India's domestic demand was 13.8 per cent above previous-year's levels against a capacity expansion 19.9 per cent. The load factor of 78.3 per cent is consistent with the global average of 79.4," global airlines body International Air Transport Association (IATA) said in its latest report.

While the May results showed a 6.8 per cent rise in global passenger traffic over May 2010, this was four per cent higher than the beginning of the year.

"We saw positive developments for the air transport volumes in May. But there are risks associated with political unrest in the Middle East and the European currency crisis," IATA chief Giovanni Bisignani said.

"We still expect the industry to make USD four billion this year. That is a pathetic 0.7 per cent margin and another shock could alter the industry's fortunes dramatically. It is another tough year for a very fragile industry," he added.

In China, domestic demand was 10.4 per cent higher than in last May, with load factors touching 82 per cent.

On the global passenger market, the IATA report said the "fastest international growth" was witnessed in Latin America where air carriers saw a growth of 21.3 per cent compared to May 2010. The airlines of this region also experienced the fastest capacity expansion at 15.2 per cent.

Asia-Pacific carriers recorded an expansion of 4.7 per cent, which was considerably below the global average of eight per cent. This was due to continuing weakness in the post- earthquake/tsunami Japanese market, it said.
(Source: Economic Times)

Manpower crunch plagues Hospitality industry

As India's hotel industry readies for unprecedented growth, it is about to face a manpower crisis the likes of which it has never seen before. Too few people are being trained for the industry; many of those who have received the training choose greener pastures and fierce fights break out regularly to keep or poach the few who remain. All this while a new hotel or restaurant is being added every week.

"It is a battle every day to retain people you have groomed over the years. While earlier the mantra was to engage with the staff, today you have to keep them enchanted," said Sujata Guin, regional director of human resources at luxury boutique hotel chain The Park.

"It is not just other hotels we are losing people to. Everyone wants a piece of the hospitality pie - retail, telecom and banking."

With India's economy expanding by about 8% a year, the number of people travelling on business or for pleasure is booming. Every year, there are 540 million domestic travellers and the number of overseas tourists will increase from five million now to 18 million by 2016, according to HVS Hospitality Services, a consulting firm focused on the hotel industry. Where India now has 62,000 top-quality rooms for such travellers, by 2014 it is expected that there will be 150,000 rooms. But where are the chefs, butlers and bellboys to serve all the guests?

Surveys show an immediate shortfall of 30-40% in the supply of quality manpower as students passing from hotel management institutes shun the profession because of poor pay and long work hours. They prefer to work overseas or with cruise liners, airlines and retail companies. One such student is Sandeep Singh, who graduated this year from the International Institute of Hotel Management in Delhi. He had offers from Le Meridien, Pullman and The Oberoi but he preferred to join an event management company.

"I am getting three times the money offered by the hotels and I do not have to work for 14 hours a day," he said. Another hotel management graduate Manish Paul took up a job at Kingfisher Airlines , a decision he made after working 42 hours on the trot at a hotel during his training. Nakul Anand, who heads the hospitality, travel, and tourism businesses for ITC, said six out of every 10 students from the Welcomgroup Graduate School of Hotel Administration run by the business conglomerate do not join the hotel industry.

"We need to find more creative ways to attract people," he said. There was a hotel boom in the late 1980s and 1990s but demand for manpower was met by hotel management and catering institutes. This time, the industry is ill-prepared. Anand, who is also the president of the Hotel Association of India, estimates that the hotel industry will need to add 100,000 staff within four years. But only about a fifth of this number are even being trained and a big slice of them will not join the hotel industry.

Suresh Kumar, president of Fortune Park Hotels, a division of ITC Ltd , said that when demand outstrips supply, the existing talent pool becomes extra precious. Hotels also hire those just out of training school and groom them, but quality is inconsistent. Fortune will open 24 new hotels with three years and will have to hire two people for every room it constructs.

KB Kachru, executive vice-president for South Asia at Carlson Hotels, the owner of the Radisson brand, points out that in the recent past some of his staff have ventured out to become entrepreneurs, robbing him of valuable top-flight talent. At the other end, salaries for the junior-most staff have gone up 50-60%. Carlson is setting up 19 new hotels that will come up within one year and require an average of 250 staff per hotel.

While hotels expand rapidly, training institutes that supply the manpower are not keeping pace. Furthermore, many in the industry complain that the training provided by many institutes is outdated. Most hotels resort to an extensive internal training programmes to meet their needs.

Shalini Khanna of IIHM in Bangalore is of the view that the manpower shortage can be bridged only if there are more professional institutes. IIHM trains about 700 students a year nationally, of whom 200 opt for jobs overseas.

In this clamour for quality staff, home-grown hotels are under immense pressure as people are attracted towards international brands, which are now expanding in a big way, said Anupama Jaiswal, senior associate at HVS Executive Search, which helps hotels recruit staff.

Big hotels chains such as EIH (Oberoi), Taj and ITC prefer to rely on inhouse courses and training to cope with the problem. ITC Hotels, said its chief operating office Dipak Haksar, has also introduced monthly career development reviews for discussions and dialogues on talent development, succession planning and career management.

While hotels are trying to cope with in-house training the manpower shortage will only worsen. Midterm salary revisions and extraordinary pay-raises are among ways the industry is attempting to retain efficient employees.

The 2011 HCE India Hotel Salary Survey shows that in spite of difficult times, compensation levels in 2010-11 are comparable to those in the boom year 2007-08, when disproportionate salary increases - up to 43% - were seen throughout the industry.

The problem is that when hotels spend so much time and resources to train and groom people, it causes a crisis sometimes when people leave. "So, we have created an internal system to create a pool of leaders, to have backups if someone leaves. We are exploring alternative sources of recruitment. We are taking people from the north-east, smaller cities, aviation institutes and grooming them," says Park Hotel's Guin.
(Source: Economic Times)

Wednesday, June 29, 2011

Agriculture: Acute labour shortage has industry rushing in

The one thing business teaches you to sniff out fast is the money in every crisis. The biggest problem in the Indian countryside today is an acute labour shortage . Sure enough, it has become a corporate goldmine. ET helps you join the dots.

Farmers are spending 40 paise on hiring labour out of every rupee they invest in a crop. Even then, there is no guarantee of help to cope with the back-breaking task of growing food, fibre and feed. In theory, one out of every two Indians is employed on a farm. In reality, skilled labour is now so scarce and expensive that farm-owners have to either scale down operations or suffer yield and quality losses.

Sensing their desperation, companies are lining up with solutions. Mechanisation is the most obvious one. Machines were always available for tilling, sowing, spraying and harvesting crops. Drip irrigation , where entire field is watered at the push of a button, is increasingly becoming popular.

The big difference now is that mechanisation is driven by consumer demand rather than subsidy push from central and state governments. Farmers themselves want to buy these cost-effective machines that come with peace of mind and independence attached.

From tea and cereals to sugarcane and spices, farmers are replanting fields keeping machinery in mind. Commercial broiler poultry farms are adopting expensive automation that can cost 80-100 per bird because savings in wage bill and efficiency make it worthwhile.

The biggest companies are fast launching new models of tractors, harvesters and power tillers. The number of patents filed in India for agricultural machinery has jumped 20% between 2008 and 2010. No wonder then that CII this month asked for greater push to the $250-million farm machinery market through soft loans, subsidised lease rental schemes and shifting subsidy from rupees per kilo to rupees per acre. The smell of money is too enticing to be ignored.

Unfortunately, machines can't do weeding, a vital Six Sigma activity on each farm. The amount of time spent on weeding varies: from six days per acre of sorghum, 10 days per acre for groundnuts or sunflower, to 18-20 days per acre for maize. Farm experts say late weeding can badly hit yields.

The obvious solution is to replace manual weeding with herbicides, i.e., chemicals that kill them. Herbicide demand is rising sharply and could double in the next three years. Companies expect sales to touch $530 million by 2014. Market for glyphosate, the world's top-selling herbicide, is expanding 20% every year because farmers can't afford manual weeding any more. Chemical weeding is the hot new trend.

Machines need land of certain minimum size to be effective. They run on increasingly expensive diesel and scarce electricity. Most importantly, Indian farms are now being tended mostly by women, who find machinery and manual equipment too heavy to handle. Chemical weeding can hurt the crop as well as human health.

Seed has no such disadvantage. It is affordable, plentiful, safe for human health, doesn't need electricity, spare parts, instruction manuals or large farms. That's why in a country with 121 million farms, most less than 2 hectares in size, the most daring and exciting solution to the labour problem is seed that doesn't need frequent tending, weeding and harvesting.
Money is pouring in. Seed companies are ploughing the biggest chunk of their R&D investment into cotton and corn, already the poster boys of science-driven industrial farming. They are confident of good returns because of the value and convenience new seed will offer.

Single-cross corn hybrids, for instance, can grow cobs at uniform height. That makes it easy to use mechanical harvesters. A new cotton hybrid ensures that all the bolls flower simultaneously. This means a field can be harvested manually in one go. Currently, farmers hire pluckers at 300 per day thrice in a season because bolls on the same plant mature at different times. Herbicide-tolerant corn and cotton allow farmers to spray the field with weed-killers without worrying about damaging the crop. That reduces the wage bill while increasing yields.

Like the IT industry, agriculture too is facing a serious crunch of skilled manpower. With no chance of outsourcing or offshoring, farmers are eagerly buying products and technology that can free them from dependence on hired hands. For corporate India, hands-free agriculture is a mega profit opportunity that can only swell as more youth head towards city lights.
(Source: Economic Times)

Microsoft launches cloud version of Office

Microsoft is set to place one of its biggest bets yet on cloud computing with the launch of Office 365, an online version of its most widely used business software.
The software company’s belated push online with one of its core businesses comes more than four years after Google came up with its own service, but has still left it in a strong position to dominate the market for online applications used by white-collar workers, according to analysts. 
Since many businesses are starting to look for the first time at moving applications to the internet, “I think they got the timing right”, said Wes Miller, an analyst at Directions on Microsoft, an independent research firm. “Microsoft all along has bet big that the cloud will be a direction, but this is the first time everything is focused on it.”
Despite setting the pace with the paid-for version of its Google Apps, the search company has made fewer inroads than most tech industry observers expected when it took aim at one of Microsoft’s cash cows.
The search company said that its paying users now number in “the millions”, although it does not disclose details, and most of the 30m users it claims for Apps are college students and others who do not pay.
The new service combines an online version of the company’s ubiquitous suite of Office productivity applications with cloud-based versions of Exchange, Lync and SharePoint, its server software for e-mail, unified communications and online collaboration, respectively.
The price for the small-business version of the software has been set at $72 per employee a year, above the $50 charged by Google.
But with more capabilities and the attraction for businesses of being able to move Office users to the new service with little training, it should catch on widely, analysts said.
Microsoft’s business division, which rests largely on the Office productivity applications, became its most profitable operation in the first nine months of its current fiscal year on the back of the launch of Office 2010.
Operating profits rose by 20 per cent to $10.2bn, topping those of Windows, which has suffered from a weak PC market.
Besides defending its existing business, Microsoft hopes that the move online will boost revenues as it takes on more of its customers’ computing operations rather than simply selling them software.
The online subscription service means it will also be less vulnerable to pirated versions of its software, which company officials believe are used by roughly half of the 1bn people who use Office.
Some tech-industry executives questioned whether Office will retain its central position in the lives of white-collar workers as the ways they work with information online change, and as they rely more on smartphones and tablets.
Workers will turn to new online services that are less tied to the document-based approach of Office, predicted Paul Maritz, chief executive of VMWare and a former Microsoft executive.
(Source: Financial Times)

The Contagion Risk of Europe

Bernanke gave another press conference after the FOMC meeting this week. Taking his time to address the situation in Europe, and the increased urgency of the crisis in Greece, Bernanke said US bank exposure to Greece was minimal and only indirect, via positions in large, core-nation banks in Germany and France. Raising a red flag, the bearded academic said that money-market mutual funds had substantial exposure to those same banks and could take a big hit if push came to shove in Europe. A disorderly Greek default would have significant effects on the US economy, he added.
About the only thing there was seeming consensus on in Europe was that Greece will eventually default. The question is when. European leaders, along with the IMF, have caved and will give Greece Euro 12 billion to tide them over while they debate on finding ?70-100 sometime late next month. By some accounts that amount will have to be a lot more. Meanwhile, the ECB is adamant that Greece cannot be allowed to default.
The whole process is somewhat akin to trying to help someone who is drunk by giving them another bottle of whiskey. Trying to cure a problem of too much debt with even more debt is simply irrational, and everyone but Europe's leaders can see that. So why are they doing it?
Because if Greece is allowed to go, there is real reason to believe that the problems will spread rather quickly to the rest of peripheral Europe. By the way, it is not just French and German banks that US money markets have exposure to; there are a lot of Spanish banks that have issued commercial paper as well. And my sources told me that many of the state-owned German Landesbanks are essentially insolvent, with massive amounts of sovereign debt. By the way, another source notes that US money-market funds are not rolling over the commercial paper to some of the banks (like Spanish ones), so there is a liquidity squeeze coming to European banks in peripheral countries.
The ECB has taken on some Euro 100 billion of Greek, Irish, and Portuguese debt, if I remember the number right. They have capital of only about Euro 10 billion. They want to take on even more debt from the banks, as the banks are using sovereign debt as collateral. The whole process is a way to paper over the fact that many European banks are essentially insolvent if they have to mark to market their Greek debt.
I think it is a given that in the near future Ireland is going to tell the ECB that the line item on their balance sheet for Euro 60 billion that says ?Loans to Ireland to bail out their banks? should be moved from the line that says loans to the line that says capital. They will simply walk away from the debt. Here are the keys to your banks. What are you going to do with your banks??
Let?s assume (generously) that there is only a 50% haircut on Greek debt. Add in the Irish debt, assume a smaller haircut on Portugal, at least initially, and you can easily get to ?100 billion in losses for the ECB. That makes Lehman look like small potatoes.
The ECB would either be forced to print money to cover the losses or have a massive capital call to ECB members. Germany is 27% (again, from jet-lagged memory), so their portion would be a mere Euro 27 billion. How do you think that will play with the voters in Bavaria? The ECB was not supposed to take on bad debt, according to its original charter. More than one person speculated to me that Germany might simply use that as an excuse to leave the euro. Not by the current set of politicians running the place but the new set that will be elected when things go bad.
And printing? Not all that good for the value of the euro.
Will the Euro Survive?
We had dinner on Monday night at the home of Hervig von Hove of Notz-Stucki Bank, where I was speaking the next morning. There were 16 of us at the table, and these people represented a great deal of money as managers and investors. All very well-informed. We sat outside in perfect weather in the Swiss countryside. Charles Gave sat across from me at the middle of the table, and we talked and debated as the rest asked questions and offered opinions for 3-4 hours. The wine was flowing, and it was a most interesting evening. Now, with that set-up?
I was asked if I still thought the euro was going to parity with the dollar, and I said I did, although I was not sure what the euro would look like in three years, or who would be in it. There was some pushback from people who thought the dollar would be the weaker currency. So I asked for a show of hands as to how many people thought the euro would be higher in one year?s time. There were 6 hands raised, but one gentleman said he was actually abstaining. So I asked how many thought the euro would fall, and we got 12 hands. Yes, that is 19 votes for 16 people. Clearly there were at least three economists in the group who voted both ways!
Then someone asked Charles about the issue. Now, for those who have never had the extreme pleasure of time with Charles, he is a powerful, white-haired French patrician, and one of the better economists I know. Quite a brilliant thinker and not afraid to express his mind forcefully with a voice that sounds like God talking, with about the same assurance (note to self: never again follow Charles on a speaking stage).
?The question is entirely irrelevant? ? punctuating the air for added emphasis. ?The euro will not exist in a year. The whole thing was dysfunctional from the beginning.?
I suggested that was a tad bearish.
?Not at all. I think it is extremely bullish. The demise of the euro and the return of national currencies will allow for proper allocation of investments and resources. It is the best thing that could happen for the markets.?
I could not get him to commit to exactly how that process of dissolution would look.
?I didn?t create the euro so it is not my responsibility to solve the problem for them.?
But I cannot help but think that any exit by anyone from the euro will be disorderly, giving rise to Bernanke?s ?significant effects.? Many European banks are simply not solvent if there are major sovereign defaults. The US banks have sold some $90 billion in credit default swaps on Greek, Irish, and Portuguese debt to European banks. That is supposedly balanced with other purchases of CDS, but my sources say that much of that insurance is from German Landesbanks. Yes, the same ones I mentioned above that are basically insolvent. We are joined at the hip to Europe. A European recession would certainly be felt here. And a credit event could cause the same problem as in 2008, as banks start to refuse to lend to each other again. Ugh.
The potential for a real crisis is far too high for comfort. It would mean another recession for sure, with the US already close to stall speed and global growth slowing. I hate to sound alarmist, but I am worried. Absent a problem in Europe, the US should be fine, if slow. And maybe European leaders can stall the crisis off longer, buying time for banks to move their debt to the ECB and raise capital. We have to really keep our eyes on this.
At some point, Europe needs to realize that the problem with Greece, Portugal, et al. is not illiquidity, but that they are insolvent and have few prospects for economic growth anywhere close to what is needed to solve their problems.
Europe would be better off just taking the money they are giving to Greece and using it to recapitalize their banks. Let Greece go. Give it up. Let them enter a 12-step program or whatever it is that insolvent nations do. That is harsh, but it is also the truth.
But there are very sad things going on. It is not just banks that are losers here. Pharmaceutical companies are starting to refuse to deliver to Greek hospitals, as they are up to two years behind on their payments. It turns out that Greece owes some ?6 billion to private businesses like hospitals and simply cannot pay. Those costs are rising, and much of it is to hospitals for medical care supported by the government. They are issuing bonds (shades of California) for the debt in some cases, which sell for a discount of 50%, if they can be sold. And we thought finding ?12 billion was a hard thing.
This is not just a Greek problem, it is a concern in many countries that are having financial difficulties.
A Greek Coup?
Now, time for some speculation on my part. For Greece to leave the euro, the politicians would have to make a rather serious decision. That will not happen overnight. The minute there was any speculation or a ?secret? meeting of Greek leaders to discuss leaving the euro, the run on the banks would be massive and fast. It would all come down quickly.
To go back to the drachma would require a bank holiday for a week, and it would have to be a surprise move. About the only way for that to happen would be a military coup coupled with a bank holiday and promises to return to elections after the currency issue was solved. The current government does not have the votes or the power to declare a holiday and move to the drachma, or at least they don?t as I read it. Just a thought.
 (By James Mauldin)

Brazil and China Battle Over Copper in Africa

Brazil and China are heading for a battle of strategic necessity over copper in Africa that will leave the winner walking away with the most expensive acquisition of a diversified minerals company.
Jinchuan Group, the biggest Chinese nickel producer, is considering a bid for Johannesburg-based Metorex Ltd. (MTX) to rival Vale SA (VALE5)’s offer, two people familiar with the deal said yesterday. Metorex is trading 6.1 percent above Rio de Janeiro- based Vale’s proposal of 7.35 rand a share, the most of any pending deal in Africa, making it the likeliest to garner a higher price tag, according to data compiled by Bloomberg.
Vale, the world’s largest iron-ore producer, and Jinchuan are seeking Metorex’s copper and cobalt mines in the Democratic Republic of Congo and Zambia after demand in China for copper used in construction and appliances pushed the metal to a record this year. Vale’s 7.9 billion rand ($1.2 billion) offer already values Metorex at 30.2 times earnings before interest, taxes, depreciation and amortization, the richest diversified minerals takeover greater than $1 billion, the data show. Bids may reach 10 rand a share, said First Asset Investment Management Inc.
“The Chinese and the Brazilians have voracious appetites” for mining, said Andrew Ross, partner and global equity trader at First New York Securities LLC, a New York-based proprietary trading firm that bets on stocks, commodities, currencies and derivatives. “They view themselves in direct competition for these strategic natural resource assets.”

Competing Bid

A Vale official in Rio de Janeiro, who declined to be named citing corporate policies, said the company had no comment. Jacques de Bie, a spokesman for Metorex, referred to the company’s June 17 statement disclosing an “unsolicited, non- binding expression of interest” from another party.
“It’s not yet a bid or a firm offer or a firm intention to make an offer,” de Bie said. “It’s just an expression of interest at this stage.”
Jinchuan has not made a decision regarding a bid, one person said yesterday, asking not to be identified because it’s too early in the process. Wang Wanshou, a Jinchuan official, said yesterday that he had no information on the deal. A call to the company office outside business hours wasn’t answered.
Metorex owns the Ruashi copper and cobalt open-pit mine in the Katanga province of Congo, as well as the Chibuluma underground copper mine in Zambia. The company has an estimated 4.74 million tons of copper resources, it said in April.

‘Hard to Find’

“Good copper assets are hard to find and Zambian copper assets are prized,” said John Stephenson, who helps manage C$2.7 billion ($2.8 billion) at First Asset Investment in Toronto. “Both Vale and Jinchuan could use the copper exposure and it would be a huge benefit for both.”
Vale is aiming to increase production of copper almost fivefold to 1 million metric tons by 2015. The company, which made 75 percent of its revenue last year from iron-ore mining, cut its target this week for 2015 output of the steelmaking ingredient by 10 percent.
It already has a presence in Zambia via its joint venture with Johannesburg-based African Rainbow Minerals Ltd. to develop the Konkola North copper project. Vale Chief Executive Officer Murilo Ferreira, who started in the role in May, told investors that month that the company needs to speed up its studies on how to increase copper output.

‘Very Strategic’

“Vale has not been successful thus far in building out a meaningful copper business with their assets in Brazil,” said Anthony Rizzuto, an analyst at Dahlman Rose & Co. in New York. “You’re looking at a company that has and needs to pay up to be able to expand this business, which they regard as being very strategic in nature.”
Brazil’s gross domestic product grew 7.5 percent in 2010, the fastest pace in more than two decades, according to a central bank survey of economists published May 30. The country overtook Italy last year to become the world’s seventh-largest economy, according to the International Monetary Fund.
Vale’s bid at 30.2 times Ebitda in the past 12 months is about three times the next highest valuation ever paid in the diversified minerals industry for a takeover greater than $1 billion, data compiled by Bloomberg show. The previous record was Xstrata Plc’s purchase of Jubilee Mines NL for 10.1 times Ebitda, or $2.5 billion, announced in 2007.
Metorex’s biggest shareholder, Industrial Development Corp., said it’s “premature” to take a position regarding other bidders. IDC, which is South Africa’s state lender, in May threw support to Vale’s bid.

No Position

“We don’t have a position on a new offer as no new offer has been presented so far,” Mbuyazwe Magagula, the new head of mining for IDC, said in an interview yesterday.
Shareholders are scheduled to vote on Vale’s offer July 22. Metorex’s agreement allows other potential acquirers to review the same information that was given to Vale, leaving the door open to other bids.
Jinchuan Chairman Yang Zhiqiang said in a March interview that the closely held company is looking to buy stakes in overseas copper mines. The Gansu Province-based company produced about 400,000 tons of copper, 130,000 tons of nickel and 6,000 tons of cobalt last year.
“Copper and cobalt are in strong demand in China,” said Bernard Horn Jr.,president of Boston-based Polaris Capital Management LLC, which manages over $4 billion and more than 25 million Metorex shares. “So it certainly doesn’t surprise me that some Chinese buyers are potentially interested.”

Rebuilding Congo

China agreed in January 2008 to help rebuild Congo in return for access to copper and cobalt. Congo has a third of the world’s cobalt, which is used in medical implants and rechargeable batteries.
Premier Wen Jiabao said in February that China, the world’s largest user of copper, plans to build 36 million affordable homes in the next five years.
“Copper demand will continue to expand,” Dahlman Rose’s Rizzuto said. “Copper is a basic building block of infrastructure development.”
Copper for delivery in three months on the London Metal Exchange has nearly tripled to $9,072 a ton as of June 28 since the end of 2008 and climbed as high as a record $10,190 on Feb. 15. The metal, which is used in electric cables and plumbing, will average $9,750 this year and $10,000 in 2012, according to the median of analysts’ estimates compiled by Bloomberg. Mining companies haven’t kept pace with demand because reserves are becoming harder to find and the quality of ore is declining, meaning less copper is extracted from each ton of rock.

‘Pretty Convinced’

Metorex closed at 7.80 rand yesterday, the highest price since October 2008 and 6.1 percent above Vale’s offer, data compiled by Bloomberg show.
“The share price has been trading above the offer price, so obviously there are some investors out there who are pretty convinced there is going to be a better offer,” said Stephen Meintjes, head of research at Imara SP Reid in Johannesburg.
A “knockout bid” may be closer to 9 rand a share, he said.
First Asset Investment’s Stephenson said a bidding war may reach 10 rand a share or more.
The deal isn’t as expensive based on future earnings from three mining projects in Congo that haven’t started operating, Meintjes said. Two of the projects are “within a few kilometers” of the Zambian border, according to Metorex’s website, which is where Vale and African Rainbow Minerals are developing the Konkola North copper mine.
Even though Metorex’s assets are “worth a lot of money,” they will require additional capital from a buyer to bring them into production, Polaris’s Horn said.
“There’s a potential bidding war for this African asset,” First New York’s Ross said. “There’s a race for assets worldwide going on. China and Brazil are at the forefront of that race.”
(Source: Bloomberg)