General Electric bets on emerging markets to beat US slowdown
By Our Corporate Bureau | 29 Oct 2007
"The fastest growing countries for us are the emerging economies, including China, India, Russia and Latin America. In these regions, we have annual revenues of about $32 billion and the figure is growing at around 20 per cent a year,'''' the Financial Times quoted GE chairman and chief executive Jeffrey Immelt as saying.
He expects GE's sales outside the US to expand in the next few years by an annual 10-15 per cent.
Despite the troubles sparked by the credit squeeze, "outside the US, particularly in China and India, economies appear strong," Immelt said. "In the world as a whole, there is still a lot of liquidity," he added,
Immelt said there is considerable impact of sovereign wealth funds. State-run bodies are pumping large sums into the global economy and financing large acquisitions.
The credit markets have less impact on the kind of business that GE does, he said, adding, "Even in the US, if we assume there will be some slowing in the economy, the likelihood is that demand for the kinds of infrastructure-related items that we sell, such as medical scanners and power systems, will stay quite high."
In the US, sales growth will inevitably be lower. "This year, we will probably expand our revenues in the US by 6-7 per cent,'' he added.
While GE is a leader in electricity generating systems such as gas turbines, in new energy projects generally, he says the "next five years are going to be phenomenally exciting" as a result of interest in alternative power technologies, including solar energy, wind and nuclear energy.
"Nuclear is going to be somewhere between big and really big. We're spending a lot of money - $400-$500 million - on new nuclear technologies. If you look at our nuclear business now it gives us annual sales of about $1billion and this is likely to expand fivefold in the next five to 10 years," Immelt said.
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