Great uncertainty around economic recovery - US consultant

17 September 2009 17:30  [Source: ICIS news]

BOSTON (ICIS news)--There is great uncertainty around the pace and extent of the global economic recovery, a US consultant said on Thursday.

“One factor it will depend on is how the Great Recession has reshaped people’s attitudes around consumption,” said Vijay Sarathy, vice president of US-based consultancy Charles River Associates (CRA).

Sarathy was speaking at the Chemical Purchasing Summit, organised by ICIS and Purchasing magazine.

“A sharp up-tick in the personal savings rate could dampen consumption,” he added.

Plus, there are still concerns around unemployment, bank balance sheets and huge impending maturities of high-yield debt, Sarathy said.

Another major factor is changing attitudes among government surrounding the issue of free trade versus fair trade, he said.

“We’ve all been globalising our supply chains, but a slight change could have a major impact. President Bush’s antidumping duties on steel imports in the US years ago sparked a mini-industrial revolution in Pittsburgh,” Sarathy said.

The US could well see a mini-resurgence in manufacturing with increasing trade barriers, he said.

“Companies that have been globalising their supply chains may need to rebuild bridges with local suppliers - these local suppliers may be more competitive,” he said.

Paul Hodges studies key influencers shaping the chemical industry in Chemicals and the Economy
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By: Joseph Chang
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