 Amid the gloom, Alstom chief stays upbeat
(China Daily)
Updated: 2008-12-03 08:02 Alstom SA CEO Patrick Kron is having a hard time feeling the gloom and doom. The French maker of power plants, turbines and trains is hiring 1,000 people a month worldwide to work through a 47 billion-euro backlog and the CEO anticipates a further boost as governments from the US to France increase infrastructure investment to weather the global economic decline.
"The world is rediscovering the Keynesian approach to the economy, and that will benefit infrastructure projects," Kron said in an interview at the company's headquarters near Paris. "I cannot convince myself that the infrastructure needs of a year ago aren't still true today." Alstom, the world's third-biggest power-plant builder, has fallen 47 percent this year in Paris trading on concern the world financial crisis may hurt large energy projects. While the credit crunch may prompt some clients to delay jobs in the short term, Kron predicted that the need for new power generation and environmentally friendly rail links will spur longer-term orders in both developed and emerging markets. "Capital goods-related stocks have suffered from the perception that demand for heavy equipment will decrease. It may be true for cement plants or steel factories, but I think it's unfairly applied to us," Kron said. "We're in growing markets and where there's a government plan to support the economy, there's an element to sustain investment in infrastructure. I believe this will boost demand if there's a slowdown here or there." Early next year, Barack Obama will propose an economic-stimulus package three times larger than one he was discussing only weeks ago, with the main focus on infrastructure, according to lawmakers and aides to the US president-elect. French President Nicolas Sarkozy has pledged measures that include "massive" investment in infrastructure and said he wants to see similar measures across Europe. Such moves are in keeping with the economic philosophy of British economist John Maynard Keynes, who advocated government intervention in areas such as taxes, interest rates and public projects to stimulate growth. Agencies (China Daily 12/03/2008 page16) |
