NEW YORK: Bank of England policymaker Adam Posen said on Monday he is more worried about economic stagnation than inflation or deflation, and that central bankers need to guard against repeating the mistakes of the 1930s.
"What I'm worried about is stagnation," said Posen, when asked what concerns him more over the next three to five years. "It's not about inflation or deflation, it's about very large, real shocks bumping the economy up and down around a relatively austere, low-growth path," Posen said.
Speaking at the Council on Foreign Relations in New York, Posen said he fears that 50 years from now, policy will be viewed in the same way the Depression era is now, which he called a "major deflationary mistake."
"If we repeat the mistakes of the past and prematurely tighten or insufficiently loosen, whatever you do on fiscal policy, whatever you do on financial regulation will be overwhelmed by that mistake," Posen added.
Posen, known for his dovish views, said that economic stimulus efforts by central banks only become inflationary if central banks are unwilling to withdraw those measures when the time comes, and there is nothing to suggest that will be the case.
The Bank of England restarted its quantitative easing program in October with a plan to buy 75 billion pounds of government bonds, on top of the 200 billion pounds of purchases it made in 2009 to 2010.
Meanwhile, the US Federal Reserve has bought more than $2 trillion in long-term securities to keep borrowing costs down and spur the US economic recovery.
Last week, Posen wrote an op-ed urging the European Central Bank and the Fed to buy significant amounts of government bonds to help boost their economies. (Reporting by Leah Schnurr; Editing by Padraic Cassidy)
reutr November 28, 2011 which cut off tens of millions of users in the Middle East and India when submarine cables were damaged.
"That supported our case, and increased interest in the project," Mekky said.
The company has invested $500 million in the project so far and is considering an expansion eastward into Singapore, likely in the second or third quarter of 2012, Mekky said, adding that he viewed Iran as another highly promising market.
"Iran is just as hungry for telecom services as any other market in the Middle East. It has a very young population which is growing.
Internet use and mobile connectivity are an essential part of life, and we are happy to be able to provide it to them."
The firm's shareholders include regional sovereign wealth funds such as Qatar Investment Authority (QIA), Kuwait Investment Authority (KIA), as well as Qatar Foundation.
Its regional partners include Qatar Telecom (Qtel), Vodafone Qatar, Bahrain Telecommunications (Batelco) , Oman Telecommunications Co (Omantel), Dubai's du and Iran's ITC, Mekky said.
The company is also considering an initial public offering in upcoming years, he said. "We are considering that, maybe in a couple of years," he said.
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