China’s cautious economic reboot is warning for world
Franklin Templeton Mutual Fund has initiated the process of monetisation of assets and distributing monies from the respective schemes by seeking consent from the unit-holders of the six closed debt schemes.
The move comes days after the Sebi asked the fund house to focus on repaying investors early.
“Our immediate focus is on getting ready for the voting process,” the fund house said adding as per Regulation 41 of Sebi (Mutual Fund) Regulation 1996 once the Trustees receive authorisation from unit holders, monetisation of assets and distributing monies from the schemes will be taken up.
It cautioned that voting in the “Negative”, may delay the process of monetizing such assets and distribution of proceeds.
In a letter to investors on Thursday, Franklin Templeton India president Sanjay Sapre said, “Some investors believe that by voting in the “Negative”, the winding up will be reversed and that the six schemes will recommence the redemption and subscription process. This is not true. The purpose of the vote is to authorise the trustees to take the next steps for disposal of the assets of the scheme.”
May 15: China has a lesson for the world: An economy is harder to reboot than it is to shut down.
Fresh data for the month of April, covering a period when the government pushed hard to reopen the economy as the coronavirus came under control, show that retail sales continue to fall as consumers shun restaurants and curb spending on other nonessential items.
While factory output rose for the first time since the virus struck and state investment improved, private investment remained anaemic. Worryingly for manufacturers who are already battling deflation and a slump in global demand, inventories are stacking up as supply outstrips demand.
The data underscore that China's economic recovery will be gradual, with little sign of the kind of snapback some had expected when the crisis began. It also suggests a revival led by supply will create excess capacity and disinflation unless demand soon catches up--both at home and abroad.
"Unlocking the economy is a more challenging and complex task than locking it down," said Chua Hak Bin, a senior economist at Maybank Kim Eng Research Pte in Singapore.
China's experience is sobering for governments seeking to ease virus-related curbs in the hope of offsetting the deepest recession in decades. Policy makers, including Federal Reserve chairman Jerome Powell and International Monetary Fund managing director Kristalina Georgieva, have warned that recovery is still a way off.