For information contact
Craig Lindsay or Caroline Lewko in Vancouver.
The Pacific Rim Group comprises Pacific Rim Ventures Ltd., Pacific Rim Asset Management Ltd. and PRV Pacific Rim Investments (Canada) Limited. We are dedicated to providing Creative Solutions to Grow Your Business. We provide market entry, business management, corporate finance and investment advisory services in Hong Kong.
The paperless office has become one of the greatest urban legends of our information age. The INTERNET, however, is fast becoming a way to at least decrease our paper usage. No longer do legitimate, accurate and up-to-date sources need to come from the local newspaper or thick volumes at the library. You are only a ‘mouse click’ away from stock updates, the latest news and company data or market research.
If you haven’t used the INTERNET lately, check it out again. Every month, access to information keeps getting better and better. Sites particularly helpful are those that provide links to other sites of a particular topic. These sites are more focused than search engines, resulting in faster access to the information you need. Here is a small sampling of sites we have found helpful:
HAPPY SURFING!!
Congratulations to Craig Lindsay, Vice President of PRV Pacific Rim Investments (Canada) Ltd. and a director and partner of the Pacific Rim Group. Craig successfully completed the Chartered Financial Analyst program, and is eligible for his CFA designation. The CFA program consists of three examinations which are written over a minimum span of three years. Additionally, to be awarded a CFA designation candidates must have at least three years of professional work experience in the investment decision-making process.
CFA candidates study a comprehensive curriculum based on a defined body of investment knowledge which covers: ethical and professional standards; tools and inputs for investment valuation and management; asset valuation; and portfolio management.
In addition to managing our activities in North America, Craig is actively involved in the ongoing development of Pacific Rim Asset Management Ltd. As such, his CFA designation will bring added depth to our investment management operations.
Now that Craig has finished the CFA program, he aims to try something easy – learning Mandarin!! Again, congratulations, Craig!
"Fool me once, shame on you. Fool
me twice, shame on me."
William Ebsworth, Fidelity Investments
Pacific Rim Asset Management
Three of Asia’s most dynamic economies, Thailand, India and Malaysia, are gaining notoriety for their growing current account deficits. These deficits arise when more money flows out of a country than into it. Much of this is blamed (often unfairly) on a country spending more on imports than it generates from exports. Typically, rising imports in the region have not been of great concern due to a generally strong level of exports. However, recent export weakness has created grave concerns in Thailand, Malaysia and Indonesia.
In Thailand and Malaysia, deficits are likely to reach 8% and 10% of GDP respectively. The Indonesian figure will be a more manageable 3.8%. However, given Indonesia’s US$100 billion in foreign debt and recent political turmoil, even the 3.8% figure has caused concern.
Coupled with their growing deficits is a general reduction in economic growth. There is a general consensus that growth rates in these three countries will fall well below 8% per annum.
A typical knee-jerk political reaction to current account deficits is to discourage imports, either tacitly or through more direct measures. For instance, Thailand’s Prime Minister has given up his standard Italian loafers and silk ties in favour of local products, and has encouraged his colleagues to do the same. In Malaysia, Prime Minister Mahathir Mohamad is threatening to raise import duties or impose "quotas and import permits" for certain non-essential goods (for example, consumer goods, such as foreign cars and garments.)
Given the thirst in these economies for the capital necessary to finance aggressive growth programs, substantial foreign investment has been necessary. Interest on this debt must be paid in foreign currency, which further deteriorates current accounts. As well, large capital inflows tend to undermine central banks’ control over monetary policy, which thereby creates a risk of undue currency fluctuations. Currency devaluation, which would stimulate exports, deter imports and decimate investment returns, is a real concern.
So, what should investors do? The situation is certainly not terminal, and should not result in a rash alteration of regional portfolio allocations. However, these economies should be put on watch, with a view to altering the mix should the situation begin to affect long-term stock market valuations.
For information contact
Craig Lindsay
or Caroline Lewko
in Vancouver.