Any global economic contraction may end up being a “good” recession during which high employment levels and spending could still be sustained, according to the chief executive of one of the world’s largest IT services companies.
There are several reasons to remain optimistic despite bleak economic forecasts for the year ahead, CP Gurnani told The National on Monday in Davos on the eve of the World Economic Forum’s Annual Meeting.
China relaxing its Covid-related restrictions should result in an increase in consumption as it opens up. South-east Asia, India and the Middle East will all perform well, he said.
Winter in Europe has so far been milder than feared, which will help ease the energy crisis, Mr Gurnani added.
Also, the recent announcement of the shedding of thousands of jobs in the technology sector by companies such as Amazon and Meta does not necessarily point to a longer downward trend, he said.
“In the US, when you look at those job losses, you'll also remember that they over-hired to meet the demand in the previous three years. So, in a way they're adjusting, but if overall, when I look at us, I always think it will be a good recession,” said Mr Gurnani.
“The good recession is when there is still demand of the jobs. There are challenges and the Fed will have to figure out a method of balancing an ugly word like recession, and the good part where there are more jobs available, and not enough people.”
On Monday, the World Economic Forum said almost two-thirds of chief economists it surveyed believe a global recession is likely this year as a result of inflation, high debt and economic fragmentation.
All said they expect at least weak or very weak growth in Europe, while 91 per cent forecast the same for the US.
In China, they are almost evenly split between those who expect weak and strong growth.
However, margins will prove resilient, according to Mr Gurnani.
“Yes, the costs are going up. But the clients are also willing to pay more. Because they understand that it is an indexed economy,” he said.
“If the inflation or the cost of living goes up, then somewhere somebody needs to compensate. So, it will compensate by higher wages, higher delivery costs … [this] effectively means is better pricing of your products. So, I again, want to repeat that things have a lot of silver spots.”
He is also “very confident” about the outlook for India.
“The worst estimate is 6.5 per cent growth, best estimate is 9 per cent growth. So, we are talking growth,” he said.
India’s investment policies, growth of manufacturing, strong ecosystem of engineering colleges, and a focus on innovation and research and development “is bringing fruit”, Mr Gurnani added.
On climate action, technology companies can support improvements in efficiency and introduce measurement for sectors to reduce carbon emissions, he said.
However, he said the process would be faster if there were international “uniform gold standards” agreed on “input, output and how to minimise” emissions to support the push to net zero.
“Is there a way of becoming a net-zero company faster? I think, yes, there is, as long as we recognise and give credit to not only what we consume, but we look at our supplier ecosystem, we look at measurements at all levels,” Mr Gurnani said.
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Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
- NBA-spec basketball court with auditorium
- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
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GAC GS8 Specs
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Transmission: 8-speed auto
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Usain Bolt's World Championships record
2007 Osaka
200m Silver
4x100m relay Silver
2009 Berlin
100m Gold
200m Gold
4x100m relay Gold
2011 Daegu
100m Disqualified in final for false start
200m Gold
4x100m relay Gold
2013 Moscow
100m Gold
200m Gold
4x100m relay Gold
2015 Beijing
100m Gold
200m Gold
4x100m relay Gold
How green is the expo nursery?
Some 400,000 shrubs and 13,000 trees in the on-site nursery
An additional 450,000 shrubs and 4,000 trees to be delivered in the months leading up to the expo
Ghaf, date palm, acacia arabica, acacia tortilis, vitex or sage, techoma and the salvadora are just some heat tolerant native plants in the nursery
Approximately 340 species of shrubs and trees selected for diverse landscape
The nursery team works exclusively with organic fertilisers and pesticides
All shrubs and trees supplied by Dubai Municipality
Most sourced from farms, nurseries across the country
Plants and trees are re-potted when they arrive at nursery to give them room to grow
Some mature trees are in open areas or planted within the expo site
Green waste is recycled as compost
Treated sewage effluent supplied by Dubai Municipality is used to meet the majority of the nursery’s irrigation needs
Construction workforce peaked at 40,000 workers
About 65,000 people have signed up to volunteer
Main themes of expo is ‘Connecting Minds, Creating the Future’ and three subthemes of opportunity, mobility and sustainability.
Expo 2020 Dubai to open in October 2020 and run for six months
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KEY DEVELOPMENTS IN MARITIME DISPUTE
2000: Israel withdraws from Lebanon after nearly 30 years without an officially demarcated border. The UN establishes the Blue Line to act as the frontier.
2007: Lebanon and Cyprus define their respective exclusive economic zones to facilitate oil and gas exploration. Israel uses this to define its EEZ with Cyprus
2011: Lebanon disputes Israeli-proposed line and submits documents to UN showing different EEZ. Cyprus offers to mediate without much progress.
2018: Lebanon signs first offshore oil and gas licencing deal with consortium of France’s Total, Italy’s Eni and Russia’s Novatek.
2018-2019: US seeks to mediate between Israel and Lebanon to prevent clashes over oil and gas resources.
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Global state-owned investor ranking by size
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1.
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United States
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2.
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China
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3.
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UAE
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4.
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Japan
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5
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Norway
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6.
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Canada
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Singapore
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8.
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Australia
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Saudi Arabia
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South Korea
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The biog
Age: 19
Profession: medical student at UAE university
Favourite book: The Ocean at The End of The Lane by Neil Gaiman
Role model: Parents, followed by Fazza (Shiekh Hamdan bin Mohammed)
Favourite poet: Edger Allen Poe
Benefits of first-time home buyers' scheme
- Priority access to new homes from participating developers
- Discounts on sales price of off-plan units
- Flexible payment plans from developers
- Mortgages with better interest rates, faster approval times and reduced fees
- DLD registration fee can be paid through banks or credit cards at zero interest rates
UAE currency: the story behind the money in your pockets
Notable cricketers and political careers
- India: Kirti Azad, Navjot Sidhu and Gautam Gambhir (rumoured)
- Pakistan: Imran Khan and Shahid Afridi (rumoured)
- Sri Lanka: Arjuna Ranatunga, Sanath Jayasuriya, Tillakaratne Dilshan (rumoured)
- Bangladesh (Mashrafe Mortaza)
