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Investment Insider: Where Next For Asian Growth?
Look to middle-class consumer spending for the next opportunities DAVID KUO SATURDAY 07 SEPTEMBER 2013 The flight of capital from Asian markets in recent months would appear to suggest the eastern growth story may have run its course. As soon as Ben Bernanke announced in May that the US Federal Reserve would start to consider winding back its money-easing activities, investors began withdrawing funds from Asian markets. That not only triggered sharp falls in some Asian currencies such as the Malaysian ringgit, the Indonesian rupiah and the Indian rupee, but also sparked a drop in Asian stock markets too. It would seem, on the face of it at least, that the Asian growth story might have been built on the sands of cheap money created through quantitative easing in developed economies. So when the cost of money is likely to rise, it is perhaps understandable to assume that the decade-long Asian growth story might be drawing to a close too. There is some tacit evidence to suggest that the market might be correct in its assumption. For instance, Thailand has slipped into recession and red flags have been raised over growth in India. The world’s 10th-largest economy once boasted double-digit growth but that has slowed to just 4.5 per cent between April and June, less than most economists had predicted. However, it is important to bear in mind that Asia is a vast continent that comprises 49 separate countries. Just as it would be wrong to tar the UK and Greece with the same economic brush, it would be just as inaccurate to put embattled Thailand and, say, successful Philippines into the same economic basket. The Philippines’ second-quarter growth of 7.5 per cent was faster than expected. Additionally, China’s growth is expected to exceed 7.5 per cent and Indonesia, which is the world’s fourth-largest country by population, could grow around 6 per cent this year. Indonesia, of course, has some economic problems to resolve. It is importing more than it exports; inflation jumped to almost 8 per cent in August; its current account is in the red and its currency has fallen sharply. That said, there are many developed economies that would gladly trade places with Indonesia right now. Meanwhile, much has been made of China’s economic slowdown. But let us not forget that China is the second-largest economy in the world. Consequently, a 7.5 per cent annual growth rate is hardly pedestrian. In fact, recent data appears to suggest that China’s objective to rebalance its economy from export-led to one that will be driven by consumers is showing early signs of success. In the early days of Asia’s growth, investors found opportunities in the commodities sector as China and other Asian economies consumed minerals and metals to develop their infrastructure. That is likely to continue but probably at a slower pace. The next crop of opportunities is likely to come from growing demand by middle-class consumers. According to Ernst & Young, two-thirds of the world’s middle class will reside in Asia-Pacific by 2030. These are likely to want the same things consumers in developed economies have long enjoyed. So look at household names that have exposure to the East. These could include Swedish retailers such as Hennes & Mauritz, Spain’s Inditex, which owns Zara and Bershka, and the UK’s upmarket retailer Burberry, which now generates 40 per cent of revenues from Asia Pacific. David Kuo is director of fool.co.uk Continue reading
CAAS, SIA To Study Alternative Fuel Use
Taylor Scott International News Taylor Scott International Taylor Scott International, Taylor Scott Continue reading
Fuel’s Gold – Biofuel From Unwanted Plants
A team of engineers and ecologists in the USA are looking into the viability of converting woody plants on uncultivated land into a useable biofuel. Like many grasslands and rangelands around the world, the Southern Great Plains region in Texas is suffering from encroachment of woody or brush plants, in this case honey mesquite ( Prosopis glandulosa ) and red berry juniper wood ( Juniperus pinchotii ). These plants are regarded as noxious plants whose proliferation can ruin grass forage production for livestock, increase the potential for erosion by reducing grass cover and deplete soil moisture. Trying to remove them has proved costly, and such efforts have met with only marginal success. Yet if kept in check, they can benefit wildlife species, provide soil nutrients and increase grass species diversity. Now, researchers at Texas AgriLife Research and Texas A&M University are looking at converting these species into biogas while managing the ecology sustainably. Both species grow across 20 million hectares in Texas alone, and can achieve a biomass density of up to 50 dry tonnes per hectare. Mesquite thicket: Redberry juniper tree Previously, there has been no data on the gasification of mesquite and juniper wood, so the team set out to determine factors such as their gas compositions, heating values and yields. Samples were harvested, chipped and sieved, then put through a small-scale batch-type updraft fixed-bed gasifier, using air as the gasification medium. The team found that the gases consisted of nitrogen, carbon monoxide, CO 2 , hydrogen, oxygen, methane and ethane. Juniper’s contained slightly more carbon monoxide and methane, while mesquite’s had more nitrogen, CO 2 and ethane. Both had low levels of nitrogen though, about one-third to one-half that of coal. The heating values of mesquite and juniper were 20,128kJ/kg and 20,584kJ/kg respectively, equivalent to medium grade sub-bituminous coal and better than cattle manure biomass, for example, which has an ash content of 14–45%. However, the ash content of mesquite and juniper is less than 2%. What this means is that for every 100g of unburnt material you are left with 14.5-45g of ash with the biomass but only 2g of ash with the juniper and mesquite. For the end-product gases, the heating value was higher in the juniper than the mesquite, at about 3,447kJ/kg and 2,966kJ/kg respectively, while filtering out the nitrogen from them more than doubled these to about 8,316kJ/kg and 7,585kJ/kg. These figures are about 10–15% of the value of pure methane and, without the nitrogen, 27% and nearly 25%. Gas yields reached about 2.4 and 2.2m3/kg for the juniper and mesquite respectively, but Dr Jim Ansley of AgriLife Research warns against extrapolating these figures to arrive at a total resource figure. As he explains, ‘These are naturally growing, uncultivated plants, so biomass densities will be variable. We don’t know how much of the 20 million hectares is at 50 tonnes per hectare, it may only be 5–10%. Plus, there would be almost no chance that all 20 million hectares would be harvested.’ Any patches or clusters of sufficient density will therefore be scattered around, he says, so one option could be to develop small, local gasification facilities to avoid the high costs of transporting the woods to a main processing facility. Before then, he wants to develop a portable gasifier and move the technology from the lab to the field. ‘We also need to explore more ways of increasing gas yields’. Author : Guy Richards Materials World Magazine, 24 Jul 2012 – See more at: http://www.iom3.org/…h.w2oJoHFY.dpuf Continue reading
