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World Bank trims 2016, 2017 East Asia growth forecasts, cites risks to outlook

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SINGAPORE The World Bank trimmed its 2016 and 2017 economic growth forecasts for developing East Asia and Pacific, and said the outlook was clouded by risks such as uncertainty over China’s growth prospects, financial market volatility and further falls in commodity prices.

The Washington-based lender now expects the developing East Asia and Pacific (EAP) region, which includes China, to grow 6.3 percent in 2016 and 6.2 percent in 2017, slowing from 6.5 percent growth in 2015.

Its previous forecast in October was 6.4 percent growth in 2016 and 6.3 percent in 2017.

The expected slowdown in the region is mainly due to the continued moderation of growth in China, which is likely to see growth slow to 6.7 percent in 2016 and 6.5 percent in 2017, from 6.9 percent in 2015, the bank said. The growth forecasts for China were unchanged from October.

“The fundamentally positive base case for growth and poverty reduction in the region is subject to elevated risks,” the World Bank said in its latest East Asia and Pacific Economic Update report on Monday.

Possible risks include a weaker-than-expected recovery in high-income economies, a faster-than-expected slowdown in China, as well as increases in financial market volatility that could cause monetary conditions to tighten and have adverse effects on the real economy, the bank said.

“In particular, vulnerabilities created by the interplay between high levels of indebtedness, price deflation, and slowing growth in China bear close monitoring, as do corporate and financial sector vulnerabilities across much of the region.”

A further fall in commodity prices would have a negative impact on major commodity exporters and reduce the space for public spending and investment, the bank added.

Growth in Malaysia was likely to come in at 4.4 percent in 2016 and 4.5 percent in 2017, down from 5.0 percent in 2015, as weaker demand from China and low commodity prices constrain growth and public spending, the bank said.

Growth in Thailand was seen at 2.5 percent in 2016 and 2.6 percent in 2017, down from 2.8 percent in 2015, with weaker external demand and policy uncertainty likely to weigh on private investment.

Indonesia is likely to see growth accelerate to 5.1 percent in 2016 and 5.3 percent in 2017, from 4.8 percent in 2015, despite low commodity prices and headwinds to external demand.

“However, this outlook is contingent on the implementation of an ambitious public investment programme, and the success of recent reforms to reduce red tape and uncertainty for private investors,” the bank said, regarding Indonesia.

Growth is expected to firm in the Philippines to 6.4 percent in 2016 from 5.8 percent in 2015, on the back of accelerated implementation of the existing pipeline of public-private partnership projects, and spending related to the May 2016 presidential election, the bank said.

(Reporting by Masayuki Kitano; Editing by Eric Meijer)

Source: R-Business


Volkswagen CEO seeks cut to board bonuses – sources

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FRANKFURT Volkswagen Chief Executive Matthias Mueller will push for a significant reduction in bonuses for the carmaker’s management board on Monday, sources familiar with the matter told Reuters.

The proposal being put forward at a supervisory board steering committee meeting follows criticism from one of Volkswagen’s major shareholders, the state of Lower Saxony, about intentions to pay bonuses to top managers while the company grapples with the diesel emissions crisis and prepares to cut costs elsewhere.

Bonuses for senior managers have become a flashpoint in an escalating dispute with powerful labour leaders at Europe’s biggest carmaker as it prepares to finalise a new strategy.

Separately, Germany’s Bild am Sonntag newspaper said in an unsourced report that Mueller would ask board members to accept a voluntary bonus reduction of about 30 percent.

Volkswagen declined to comment.

On Friday sources familiar with the matter told Reuters that the steering committee would use Monday’s meeting to discuss the emissions scandal investigation and VW’s financial position ahead of its annual report, due to be published on April 28, as well as bonuses and friction between management and labour.

Monday’s meeting will lay the groundwork for a full meeting of the supervisory board, originally scheduled for April 20, which is due to ratify 2015 results and executive compensation.

Lower Saxony, which holds a 20 percent stake in VW, has two seats on the 20-member supervisory board.

Handelsblatt newspaper reported on Saturday that the full supervisory board meeting would be delayed by at least two days because talks were dragging on with U.S. authorities about how to make almost 600,000 diesel cars compliant with U.S. environmental standards.

VW declined comment.

(Reporting by Andreas Cremer; Writing by Jonathan Gould; Editing by David Goodman)

Source: R-Business


Japan government, Toyota, Nissan to step up efforts on intelligent maps – Nikkei

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Business | Sun Apr 10, 2016 3:00pm IST


TOKYO Japan’s government and auto giants Toyota Motor Corp Nissan Motor Co will join in an effort to develop intelligent maps by 2018, the Nikkei daily said, as competition heats up to improve the technology key for autonomous driving.

Japanese automakers, map-making companies, and the government will get together to generate standardised intelligent maps, with plans to incorporate driving data gathered by the automakers, the paper said on Sunday.

A Toyota spokesman declined to comment, while officials at Nissan could not be reached immediately for comment.

Intelligent mapping systems supply information to control self-driving cars, which are equipped with street-scanning sensors to measure traffic and road conditions.

German auto supplier Bosch said on Friday it was in talks with high-definition digital maps company HERE, exploring whether to take a stake.

Volkswagen’s Audi, Daimler’s Mercedes-Benz, BMW and car parts supplier Continental are also working on technologies for autonomous or semi-autonomous cars.

(Editing by Clarence Fernandez)

Source: R-Business

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