Factors that affected us in 2010
Factors that affected our operations in 2010
1. Strengthening economic growth and polarization of growth
The global economy gradually gained strength during the year. In emerging markets, economic growth was strong and the downturn didn’t seem to have much impact on economic development. In Europe and North America, recovery was slow, and the big budget deficits in several countries fueled uncertainty both in the real economy and in the financial markets.
2. Volatility in the currency and financial markets
Substantial regional differences in economic growth and the continued volatility in the financial markets led to strong changes in currency exchange rates, which added to uncertainty about the global economy and delayed investment decisions particularly in Europe.
3. Growing inflation pressures
The continued strong economic growth in emerging markets and the globally strengthened demand for raw materials fueled inflation pressures, particularly in emerging markets, and, in the second half of the year, also in other parts of the world. Wage inflation of the educated workforce in emerging markets has reached a high level. Many raw material prices approached the peak levels seen in 2007–2008.
4. Services business growth
Industry’s utilization rates were up and production volumes grew even faster than the global national product. This and the improved profitability of the customer base boosted demand for spare and wear parts as well as investments in repairs, optimizations and rebuilds that had been postponed during
the difficult times.
5. Strengthening upswing in the global mining industry
The continued strong growth of emerging markets increased the demand for minerals and lifted mineral prices. Several mining companies announced sizable new mining projects. At the same time, the depletion of mineral resources of existing mines requires major investments to increase the capacity
at these mines.
6. Environment
There is consensus around the world about the need for eco-efficient technology to mitigate climate change. Even so, the lack of political decision-making related to e.g. renewable energy is slowing the development of the markets.
Last updated Mar 21, 2011
