Best of 2012: General Electric interview

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General Electric vice chairman John Rice — who has been with the US industrial giant for 33 years — manages the company’s overseas interests

General Electric vice chairman John Rice — who has been with the US industrial giant for 33 years — manages the company’s overseas interests

It must be tough being John Rice. When the vice chairman of General Electric looks up, he sees only five companies on the planet bigger than his — Microsoft, Google, Wal-Mart, Exxon Mobil and Apple.

Look down, and the chances of the $239bn conglomerate catching up with its rivals anytime soon look slim: Europe is in meltdown, the US is barely out of recession and large sways of the Middle East are undergoing historical changes.

But then there is good reason why GE paid Rice $20.57m in 2011. “The waters are going to be choppy for a while and there is a certain amount of headwind,” he says. “We can create our own tailwind.”

That he certainly has done. Two weeks ago the US giant told investors to expect a ten percent growth in revenues for 2012, nearly double its previous forecast. Add the healthy growth in China, with expansion in Canada, Australia and South America, and its little wonder GE’s shares are threatening to cross the $23 barrier.

And even less wonder that Rice — who has been with GE for 33 years, and from Hong Kong manages all the company’s overseas interests — doesn’t appear fazed by the challenges ahead. The company expects almost no growth in Europe’s economies and is diverting its attention to other markets as the continent battles a recession and a debt crisis that has raised questions about the future of the euro.

“Sure,” Rice says when asked if he’s concerned about the widening reverberations of the recession in Europe.

“Europe is a big collection of economies, it’s a big part of our business,” he explains. “In our projections we assume next to no growth in Europe for the next five to ten years. It will be modest so we have to look elsewhere for our growth.”

In its most recent World Economic Outlook report, the International Monetary Fund (IMF) lowered its global growth forecast and said the global economy may get worse if the debt crisis in Europe deteriorates further.

“Low growth and uncertainty in advanced economies are affecting emerging market and developing economies, through both trade and financial channels, adding to home-grown weaknesses,” the Washington-based organisation said in its report. “The main focus continues to be the euro area,” it added. “The lessons of the past few years are now clear. Euro area countries can be hit by strong, country-specific, adverse shocks. Weak banks can considerably amplify the adverse effects of such shocks. And, if it looks like the sovereign itself might be in trouble, sovereign-bank interactions can further worsen the outcome.”

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Posted by: Abdul hafeez Sheikh

GE may look into Asia market which has potential for next decade . The promising area in Middle East is KSA which has its solid economy and long term Business prospects . The other economies in Gulf may have problems in future and t the KSA economy specially in air transportation service has long term footing . May be in future Iran may be potential;l market for GE (after settlement of nuclear issue ) . GE should invest in Solar power technology which has good long term market propects

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