Europe's emerging markets will be hit less hard by the global credit crisis than its more mature markets, according to Struan Robertson, managing director of US investment bank Morgan Stanley. 'Countries like Ukraine, Turkey, Russia, Romania and Poland are less dependent on financial services than the UK, France or Germany. The credit crisis will have less impact on their underlying property markets and their underlying GDP.'
Europe's emerging markets will be hit less hard by the global credit crisis than its more mature markets, according to Struan Robertson, managing director of US investment bank Morgan Stanley. 'Countries like Ukraine, Turkey, Russia, Romania and Poland are less dependent on financial services than the UK, France or Germany. The credit crisis will have less impact on their underlying property markets and their underlying GDP.'
Robertson made the comments Tuesday during a panel discussion organised by the Urban Land Institute at Barcelona Meeting Point entitled 'Global Capital Markets Turmoil'. He pointed out that all of the IPOs which have failed so far this year were in the 'old' Europe. 'There are significant differences between the Commonwealth of Independent States and CEE on the one hand and the US, the UK and Europe on the other. The successful IPOs and follow-on offers were all in Central and Eastern Europe, Greece and Russia.'
Robertson does not see the market in the more mature European countries opening up again until the second quarter of 2008. 'The old Europe is not dead, but it needs a long vacation. Before we see recovery, there will first be more bad news. There is still uncertainty about the the size of the sub-prime losses and real estate values. This financial crisis will take time to digest. The market will eventually return to a new level of relative normality, and in retrospect we will look it as a correction rather than a crisis. But we won't see the pricing levels we saw in the first quarter of 2007.'
Companies seeking financing for deals above EUR 300 mln faced a 'real challenge', Robertson added. 'EUR 300 mln is the breaking point. The only deals we're seeing above this level were already done before the crisis.'
Speaking during a luncheon address at the Barcelona fair, Financial Times correspondent Leslie Crawford singled out the UK, Spain and Ireland as the countries most at risk from the current liquidity squeeze. 'These countries have all enjoyed a 15-year boom and will be most affected by the credit crunch,'she predicted.