Slowdown in emerging markets not a worry: Prudential CEO
The prospect of the U.S. Federal Reserve withdrawing its stimulus programs should not be a cause for concern for emerging economies, the chief executive of Prudential told CNBC on Tuesday.
"As the U.S. recovers, that is the answer to the worries over emerging markets and the rest of the world," the head of the U.K.-based insurance giant, Tidjane Thiam, told CNBC.
"If there is tapering, there will only be tapering if the U.S. recovers which is fundamentally good news. I see worry about tapering but it will only happen when the global economy recovers and that is a good thing,"
"Yes, there will be adjustment pains, but fundamentally it's good news."
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However, Thiam's confidence over the lack of impact on emerging markets from Fed "tapering" comes at a time of increased uncertainty in the U.S.. A political impasse over future spending has caused a partial shutdown of the government on Tuesday and greater battle lies ahead over raising the country's debt ceiling so that the country can avoid defaulting on its debt obligations.
The Prudential CEO said it was important to stay focused on the long-term: "What you see is a recovery of the U.S. economy even though what you see is that everyone is focused on Washington."
Prudential has £427 billion ($693 billion) in assets under management and operates in the U.K., U.S. and Asia -- where there have been fears of an economic slowdown, particularly in the region's powerhouse China.
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Thiam said that there was "absolutely no worry from Prudential" about China, however, and he was confident the government had the means to propel growth.
"China is not a typical domestic market...The Chinese leadership has many levers it can pull and I'm much more comfortable with China growing at 7 percent, a sustainable level, rather than at 10 or 4 percent," he said.
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