Financial crisis weighs on executives' minds

NEW YORK (Reuters) - The most serious financial crisis in decades has caused business executives and government officials around the world to rein in their expectations for short- and long-term growth and warn that business volatility will be around for some time to come.

In a series of interviews with Reuters reporters, these executives -- from industries as varied as oil to property to construction crane rentals -- spoke of the widening global credit crisis and their many concerns.

Most said they were keeping a close eye on Washington, to see how the $700 billion bailout package designed to halt the crisis would work.

What is more, on Monday and Tuesday, markets around the world continued to struggle due to concerns the bailout would not be enough.

This is Reuters' fifth wrap-up of comments on this crisis.

The following are excerpts and highlights from interviews with executives on Tuesday:

TAT HONG CHIEF EXECUTIVE ROLAND NG

Singapore crane rental company Tat Hong said turmoil in the global economy will hurt earnings in 2010, but existing leasing agreements will help it meet this year's profit forecast.

"We cannot run away and be unaffected by the world financial crisis," Ng told Reuters. "But our projects are for six to 18 months, so for full-year 09, we will still do pretty well."

The company, which rents cranes in Southeast Asia and Australia, will achieve its three-year target of growing net profit an average of 30 percent a year to hit S$96 million ($65.39 million) in the fiscal year ending March 2009, he said.

ORPI CHAIRMAN BERNARD CADEAU

Orpi, the company that runs France's biggest network of estate agents, said it was confident about its prospects, despite the financial crisis that has rattled property markets around the world.

Cadeau said Orpi had outperformed rivals, despite suffering lower sales.

"Our network is vibrant and what I say is reflected in the industry. Whereas Orpi has lost 11 percent in terms of numbers of transactions, the rest of the market overall has lost 25 percent," he said.

"Like everyone else, we have difficulties due to the market conditions, but with us the effect is more or less toned down."

IRAN OPEC GOVERNOR MUHAMMAD ALI KHATIBI

Iran is concerned the deepening global financial crisis is having a bigger impact on oil demand growth than previously expected, Khatibi said.

"We are worried about demand," he told Reuters. "The financial crisis is deeper than we expected and this is definitely influencing world oil demand."

It was too early to say if OPEC would have to cut production at its December meeting to match lower demand growth.

A reduction in OPEC oil supply in September helped balance the markets and should continue to do so through October, he said.

OMAN ECONOMIC MINISTER AHMAD BIN ABDUL-NABI MEKKI

Oman was not affected by a global credit crisis, Mekki said, adding that a sharp decline in Omani stocks was only temporary.

"I'd like to assure foreign investors, as well as local (investors), that the international credit crisis does not have any negative impact on the Omani economy," he told Reuters. "The Muscat Securities Market decline now is due to speculation from investors with a short-term outlook.

"We are confident the bourse will pick up after the companies' financial results in Q3 and Q4 are announced, which we expect to be on the higher side than the previous quarters."

FADI ALAJAJI, ECONOMIST AT SAUDI ARABIAN MONETARY AGENCY

Saudi Arabia admitted problems managing liquidity and at the same time controlling inflation, but said it may lower the benchmark lending rate if convinced the monetary system is running out of cash.

"There is a problem with liquidity management ... We are not sure about the impact liquidity has on inflation rates, which are currently high," he said.

"If the government sees the need to intervene and boost liquidity, I don't think it will be done through a direct injection of cash ... but through repo and reverse repo rates given their impact on controlling and managing liquidity in the banking system," he said in a telephone interview.

JAROSLAV MIL, CZECH CONFEDERATION OF INDUSTRY CHIEF

The Czech Republic will be lucky if economic growth only slumps to 3 percent next year as the global financial crisis and a strong currency hammer businesses, Mil said.

The finance ministry and the central bank have slashed their forecasts for GDP growth in 2009 due to weakness in the European Union, the country's key export market.

But Mil was even more pessimistic.

"We will be heroes if we manage to grow by 3 percent," Mil said. "It will be a very fast slowdown. I had a feeling that it would be a smooth and soft landing, but this will be very hard, although it seems we will still be able to land."

Like some other central European peers, the Czech Republic has been relatively insulated from the global financial meltdown, as its banks have excess liquidity, low exposure to toxic mortgage debt and a low loan-to-deposit ratio.

Mil said banks have not yet significantly tightened conditions for corporate lending, but he already had signals that this was in the pipeline in the coming weeks.

"It will come and I dare to say that this is a question of weeks. I have signals from banking circles that they will come up with it," he said. "This will be a big blow for small and medium sized businesses."

PAOLO CARMASSI, HONEYWELL AEROSPACE EXECUTIVE

Falling stock markets have put a lid on sky-high aerospace valuations and could create bargains for companies with spare cash, Carmassi said.

The world's largest maker of cockpit systems is looking for growth opportunities outside its historic U.S. market, especially in defense and space or general/business aviation, Carmassi told Reuters.

"A feeding frenzy was pushing valuations to a level that we thought was (excessive). We didn't see how acquisitions could be justified at these multiples," he said when asked about a wave of industry merger speculation earlier this year.

"The recent downturn certainly has put a cap on these valuations and, if anything, I suspect there would be some more palatable opportunities for people who have the firepower, the cash. Some (external) expansion could become more affordable."

(Reporting by Yvonne Cheong, Tim Hepher, Olivier Guillemain, Simon Webb, Saleh al-Shaibany, Souhail Karam, Martin Dokoupil)

(Writing by Patrick Fitzgibbons; Editing by Andre Grenon)