Global perspectives 2018: THE OUTLOOK FOR TREASURY What you worry about today, may not be what you should worry about tomorrow and the opportunities you think are breaking today might also be gone tomorrow. In a world of fast-paced change are there any key trends of which treasury should be aware and plan longer term? By Katrina Rollinson. THE WORLD IN 2018 Daniel Franklin has been executive edi- China will be coming off its party con- Another industry to watch will be space, tor of The Economist since 2006 and editor gress which has been a big event looming from a different perspective. With new since 2003 of its annual publication, for this year. What happens after that? discoveries and the ongoing advances to “The World in…” which focuses on the Will there be a more serious push for tourism, it could be a landmark year. year ahead. EuroFinance asked him reform once that is out of the way? A Another question will be over interest what we might expect. more serious crackdown on shadow rates – how fast do they go up? We are EF: What are some of the major issues banking and growth of debt in China? quite a way through the maturity of the companies should be aware of in 2018? There are big elections also looming in cycle. How will that play out for the next Latin America for Mexico, Brazil, recession whenever that comes. No one is DF: Politically the on-going Trump Colombia. forecasting the next recession but we are drama will impact politics and econom- quite a way through this cycle. There are ics both domestically and globally. The National security issues will continue a lot of uncertainties around interest US midterms are fairly soon so that will with North Korea likely to have its rates and how fast QE gets rolled back. concentrate the mind on Trump’s popu- workable nuclear intercontinental mis- For a corporate treasury that’s the most larity or lack of. sile ready next year – so geopolitical ten- important immediate. In Europe you have Brexit and although sions will be sharper. the nominal deadline is March 2019, a More regulation is on the horizon and deal needs to be done relatively soon so another issue. A big regulatory dump is Five second summary the clock is ticking louder and louder. about to happen in Europe with MIFID, None of the political worries Contingency plans need to be made for GDPR and PSD2 – all extra things you have completely gone away in Europe: companies and particularly for banks. It have to comply with. crisis could return, refugees remain an can’t be left to the last minute. Also in issue, Brexit is still there and Putin hasn’t Europe, Italian elections are on the The new data rules coming into force gone away on the security horizon, but horizon and everyone will be looking to will affect every business. the position is somewhat less accute. see how well the Five Star Movement Then there is the ongoing technologi- Geopolitical tensions will remain (Italy’s populist movement) do. There cal development and disruption or sharpen globally. will probably be a Greek election too. impacting industry wide, particularly in Overall, Europe is in a calmer state than banking. I don’t believe the disruption on it has been in a long time. Optimism is not the corporate side will happen swiftly. a word you have heard in connection with Customers are very conservative. This Europe for many years. But a combina- applies even on retail side with the excep- “Overall, Europe is tion of Macron steadying the nerves and tion of first time youngsters coming to the probable return of Merkel in the Ger- market – but that is a small segment. in a calmer state than it man election – there will be talk after that has been in a long time. what the Franco-German engine can do Generically, it is true that every industry if it sputters back into life. Greece is cer- is being disrupted by technology. There’s Optimism is not a word tainly not out of woods yet but better than a meta trend of massive amounts of data it has done in a long time. Brexit funnily being generated that are being used by you have heard in enough has had the consequence of unit- all industries in a more intelligent way. connection with Europe ing Europe and reminding people that Therefore, intelligent data will be a big Europe matters. The Eurozone economy theme for almost all businesses. Indus- for many years.” is growing at least respectably compared tries to watch will be healthcare and bio- to recent times. tech from a data utilising perspective. 6 // TREASURY PERSPECTIVES 2017/2018 www.eurofinance.com