Global Finance

A monthly publication providing news and analysis of global market and economy. Focuses on corporate finance, capital markets, and more.

Articles from Vol. 12, No. 10, October

After a Decade of Stumbling, a Privatization Success Story
Turkey's privatization efforts so far have been tremendously successful, with strong interest coming from both domestic and international markets. Most of the sales, both private placements and equity offerings, have been at a premium. "It's a grab-itwhile-you-can...
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Alliances: If You Can't Beat 'Em
Cost structure, brand loyalty, and performance leadership are all prerequisites for passenger airlines intent on dominating their corner of the crowded skies. But global reach is increasingly a key to basic survival. Airlines that cannot succeed in all...
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Bank Merger Scene
Financial consolidation is steaming along, but cross-border deals have a long way to go. The reasons are political and cultural. Across Europe the financial sector is consolidating. Merger activity among European banks reached $40 billion in the first...
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Before ...and After.The Year 2000
Armageddon, a movie about a giant asteroid that threatens the Earth's survival, plays on theatergoers' millennial terror, much in the same way that consultants have spent the past several years convincing corporate IT managers that firms that did not...
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Bottom-Line Growth
The reach of the world's pharmaceutical companies may be more global than that of any other sector, given the small size and high value of their products. Half the number of candidates considered for the Most Global Companies in the pharmaceutical sector...
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Building Up, Building Out
Latin American banking is being profoundly transformed as wellfinanced Spanish and other international financial groups enter fastgrowing markets. Local banks are consolidating in defense, creating a larger, more efficient, and more competitive banking...
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Chemical Commoditization
Chemicals have become basic commodities, giving their manufacturers potential to sell the same basic product anywhere in the world. Now for the bad news: Competition and relatively high costs of production have squeezed profit margins very tight, so...
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Companies with Global Muscle
The age of the global titan is upon us. The idea that one company can obliterate geographical markets and operate in many time zones effectively has been around for some time. But where this illusive goal once appeared to be a phantasm of visionary CEOs...
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Contenders Are Few
The ranks of banks aiming to become regional powers in multi ple regions have diminished over the past decades. Overextention in emerging markets such as Latin America in the past burned many US banks and led to a geographic retrenchment. More recently,Japanese...
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Cutting Costs and Gaining New Markets
Cutting costs is essential to the survival of many small domestic banks in Europe, and the coming of European Monetary Union simply raises the ante. Interest rates are at historic lows in Europe; income at the margin is shrinking. The same assets now...
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Dragging out the War Chests
Major property, casualty, and life insurance players such as AIG, Aegon,Allianz, and AXA-UAP have been snapping up regional competitors with surprising speed.The feeding frenzy is indicative of the still early stage of global coverage for companies already...
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Eluding Risk on the Road
Crime directed at business travelers is on the rise.We asked New York-based security consultants Kroll Associates for advice on measures travelers should take-no matter where their destination. BEFORE LEAVING 1 Photocopy your passport, tickets, visas,...
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Full-Service Information
Big Blue and Big Bill (Gates) might seem at times to dominate the computer and software industries in terms of global activity, but a host of contenders have also built up formidable global networks. Increasingly, the key is not sales or even manufacturing,...
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Giving Estrada Time to Establish an Economic Plan
Key players in the Philippine economy discuss how they how they are preparing for the future under the new administration of President Joseph Estrada. Global Finance's Ernest McCrary moderated. GLOBAL FINANCE: What key external and internal economic...
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Global Finance's Central Banker Report Cards
IT IS TIME FOR THE WORLD'S BEST MONETARY BRAINS TO DEVISE SOME'I`HING MORE FLEXIBLE THAN TODAY'S INTERNATIONAL CURRENCY NONSYSTEM. The year 1998 is shaping up as a monetary watershed in two ways. For II countries in Europe, this is the final year of...
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Global Homes Away from Home
The major hotel chains are optimizing their global reach through differentiated branding, new properties, and the addition of nonhotel services, such as casinos. Given the sensitivity of the sector to economic downturns, the major chains must be managed...
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Global Winner: Citicorp
A handful of banks can approxi mate Citicorp's large balance sheet, but none offers its ability to arrange all possible aspects of a project from underwriting bonds and loans to providing local currency financing in more than 100 markets. Over the past...
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Going Local
Credit Suisse First Boston provides counterbalance to the claim that the world's most global investment banks are American. True, geographic hybrid CSFB's strong US operation generates half of its revenues. But with massive operations in Zurich, London,...
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Governments, Think Globally
One thing alarmingly clear in the economic crisis that began in a little corner of Asia is that globalization has progressed much further than policymakers realize. This month we devote an unprecedented 26 editorial pages to The World's Most Global Companies....
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How to Turn off the Spigot
The former Soviet republics desperately need and ardently solicit foreign capital, advanced technology, and management expertise. Notwithstanding recent debt problems in the Commonwealth of Independent States, foreign investors are lining up to bid for...
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Low Blows
In recent weeks Brazil has been battered by the emerging markets plague. But with its vast economy and as one of the world's major commodity producers and manufacturers, the country has the resources-and the will-to come out on top. As emerging markets...
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Malaysia's Breathing Space
Speculators are making runs at its currency and stock markets. Its neighbors are following tight-money policies that conflict directly with its own. Given the plunge in regional and world capital markets, Malaysia has found itself in a sea too turbulent...
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More Countries Than the UN
Competition within the "expedited integrated transportation ser vice sector"-aka couriers-is a knock-down, gloves-off fistfight when it comes to grabbing global market share, especially in the emerging markets.The United States, is a mature battleground...
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No More Toes in the Water
A bold few of the world's largest etailers are accelerating their drive to globalization, building multiple hypermarkets in target countries, where timid players might start with a single, small store. In contrast to most competitors which segregate...
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Overcapacity-And Growing
The auto industry is often cited as driving the worldwide notion of overcapacity-too many plants churning out too many vehicles. Each of the top five manufacturers in the Most Global Companies survey already reports a direct presence in at least 150...
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Playing for Keeps
Given the volatile price of oil and energy, the push into new markets might seem an expensive and risky venture. But the global players tend to take a long-term view.As privatization and technology have opened up new markets, the biggest of the energy...
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Pulling It Together
You could call it a case of bad timing, but a 40% drop (in dollar terms) in the stock market never comes at a good time. The outlook for investment in Turkey was a lot rosier before the end of August, when Russia's devaluation of the ruble set off a...
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Putting on the Kibosh on a Privatization
The setting, an old Caracas theater, was perfect for lB-rated melodrama, and the actors didn't disappoint. Minutes before the Venezuelan government was set to auction its stateowned aluminum complex in July, the last bidder withdrew-for the second time...
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Riding the Revolution
Few sectors can rival the revolution that's taking place in electronics-particularly in that corner of the business that deals with telecommunications.As customers and suppliers increasingly use the Internet to carry voice, video, and data, companies...
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Slow Reforms Pay Off
Egypt's economy is on a good growth track, with low inflation and hefty foreign exchange reserves, as reforms begun in the early 1990s begin to pay solid dividends. Privatization has been making slow but steady progress and is now moving into high gear....
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Still Stylish
By definition, conglomerates are diversified in more ways than most multinationals. "Conglomerates are companies completely driven by global and not national trends;' says Michael Bunyaner, a securities analyst at CIBC Oppenheimer in New York. The most...
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Superstar Teams of Project Finance
Given the turmoil roiiing world economies, projects that get funded today are those backed by banks and developers that can pull multiple tricks out of their financing bags. Banks combining underwriting capacity with capital markets competence and a...
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The Consistency Challenge
Accounting and consulting firms have made global reach a priority for more than a decade now. Despite the merger mania among partnerships-the latest combination, in July, yielded Pricewater houseCoopers-a host of smaller yet formidable rivals keeps the...
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The Emerging Markets Safest Banks
THIS YEAR THEY'RE MOSTLY IN TAIWAN, CHINA, EASTERN EUROPE, AND THE MIDDLE EAST. he past year has unleashed a cataclysm for many emerging market banks, as for their countries-a cataclysm that has continued to unfold since the June 30 cutoff for the credit...
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The Globalization of the Good Life: Wine, Cigars, and Fashion
At times only a pair of Gucci shoes, a bottle of Moet Chanon, or a Cuban Cohiba Esplendido cigar will do.And global executives-in New York on Monday, Rome on Wednesday, and Bangkok on Saturday-want to know which luxury goods can they find readily. Judging...
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The Rule of Personality
Foreign direct investors must determine whether the benefits of investing in Malaysia are worth dealing with an increasingly authoritarian government. The Malaysian government wants the world's largest corporations to believe that its new Chinese-style...
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The World's Safest Banks
When it comes to bank health, the industrialized world presents a study in contrasts. In North America and Europe banks are generally healthy and getting healthier. In Japan the situation has gone from bad to worse with no improvement in sight. That's...
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Toothpaste Warriors
Consumer products companies have been bellwethers of globalization, leading the charge into emerging markets years ago, as their businesses matured in the developed nations.Avon has been overseas for 40 years. Likewise, Kodak, ColgatePalmolive, Procter...
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Trading Places
Blessed by geography, well educated populace, and political stability, Costa Rica, once viewed as bureaucratic and overregulated, has made efforts to facilitate foreign investment. "Take the case of Intel," says Alvaro Saborio, executive vice president...
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Universal Portability
Content is king at global media, Entertainment, and information companies, and that content must increasingly cover issues for customers inside and outside the given market area."What differentiates global media companies is the nature of their content-local...
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Vanguard of Globalization
Catering to an infinite spectrum of global tastes, food and beverage companies are constantly inventing new products, which they hope to nurture to classic brand status.With the more mature markets already saturated,"the food and beverage companies have...
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When the Buyer's Stock Crashes
Like many an executive invested in his company, Douglas Coltharp, CFO of Proffitt's, has a personal stake in seeing that the Birmingham, Alabama retailer's stock performs well. So he was particularly chagrined when, after announcing plans to acquire...
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